Durbin, Brown, & Warren Meet with Treasury Secretary Jack Lew to Discuss Actions to Curb Corporate Inversions, Earnings Stripping
WASHINGTON—U.S. Senators Dick Durbin (D-IL), Sherrod Brown (D-OH), and Elizabeth Warren (D-MA) today met with Secretary Jack Lew to discuss last week’s announcement of new actions by the Treasury Department to curb corporate inversions and address earnings stripping.
“When corporations choose to invert and don’t pay their fair share of taxes, they leave the rest of us to pick up the tab,” said Durbin. “Families and small businesses in Illinois and across the country don’t have teams of tax lawyers to shift their tax domiciles overseas, or shift their profits and debts on or off their books, or any other shifty schemes that increase the tax burden on the rest of us. We applaud Secretary Lew’s commitment to curbing these practices, and agree that it’s high time for Congress to permanently close these loopholes in law.”
“Treasury’s move has already delivered results by making it harder for corporations to skirt their taxes, and now it is time for Congress to do our part,” said Brown. “I’m committed to working with Secretary Lew and my colleagues to reform our international tax system and shut down these scams.”
“Millions of hardworking Americans and small business owners pay their taxes,” said Senator Warren. “They don’t have armies of lawyers to help them stash cash in the Cayman Islands, or execute magic inversions to shift their corporate citizenship to a foreign country. I’m grateful to the President and Secretary Lew for taking a significant step to level the playing field and make sure that everybody, even the biggest companies and the wealthiest Americans, pays their fair share so that we can afford investments in education, infrastructure, and scientific research to move this country forward.”
In February, Durbin led a group of lawmakers calling on the Treasury Department to expedite rules to limit the use of earnings stripping and other tax avoidance schemes that are often used by foreign-controlled U.S. corporations following an inversion. Durbin is the lead sponsor of the Stop Corporate Inversions Act, and is an original cosponsor of legislation to curb earnings stripping, and ban federal contracts for companies that move their headquarters overseas to avoid paying their fair share of U.S. taxes.
Brown, a member of the Senate Finance Committee and ranking member of the Senate Banking Committee, has repeatedly urged Congress to address inversions and take immediate action to address the broken international corporate tax code. He was a member of the Finance Committee’s bipartisan International Tax Reform Working Group. In March, Brown and Durbin introduced the Pay What You Owe Before You Go Act to require corporations who want to shift their headquarters overseas for tax purposes to pay their full U.S. tax bill on all deferred overseas profits before reincorporating in a new country.
Senator Warren has called for action to address corporate inversions and earnings stripping, and has pushed for changes to fix the international tax code. She signed Senator Durbin’s February letter urging Treasury to act to limit the use of earnings stripping, and she is an original co-sponsor of the Stop Corporate Inversions Act and the Corporate Inverters Earnings Stripping Reform Act.