[Congressional Record (Bound Edition), Volume 150 (2004), Part 5]
[Senate]
[Page 6587]
[From the U.S. Government Publishing Office, www.gpo.gov]




                    FOREIGN COMPANIES MUST PAY TAXES

  Mr. DORGAN. Mr. President, I came to the floor not to talk about the 
obstruction by the majority party; I came instead to talk about a new 
report that is just out. It is a report by the GAO, and it says 
something important about fiscal policy in this country.
  The GAO report, which Senator Carl Levin and I asked for, compares 
the reported tax liabilities of some of the biggest companies that do 
business in this country, both domestic companies and foreign 
companies.
  This report studied a period of time when we had robust economic 
growth in our economy, 1996-2000. On the summary page, it says that an 
average of 71 percent of all foreign corporations doing business in the 
United States of America pay no income tax at all. These are names 
almost all Americans would easily recognize. Obviously, this report 
does not provide these names. But when one talks about the major 
foreign corporations selling products in this country, earning billions 
of dollars from those sales and paying zero to the Federal Government 
in tax liability, it raises very serious questions about gaping holes 
in this country's tax system.
  We are nearing April 15, when Americans will march off to the post 
office and pay their taxes. They will pay their taxes because they do 
not have any alternative or any flexibility. They understand the 
obligation in this country to pay taxes.
  Now, 71 percent of the foreign corporations that do business and make 
money in this country have decided they want to participate in our 
country and market system, but they do not want to participate in 
paying taxes on those profits. There is something fundamentally wrong 
with that. Once again, it demonstrates the gaping holes in our tax 
system. No, not for ordinary people, just for the big interests who do 
a lot of business, make a lot of money and pay no taxes. Shame on them.
  This report also found that 61 percent of domestic companies during 
this period of economic growth paid no income taxes in this country.
  We know the stories about companies that have decided they want to 
run their company out of a mailbox in Bermuda or the Bahamas. Why? 
Because they do not want to pay taxes to the United States. I say this 
to companies that want to do that: If they want to run their company 
out of a mailbox in the Bahamas, the next time they get in trouble, 
call the Bahamian Navy. I understand they have 21 sailors. Call them to 
get their company out of trouble.
  These foreign corporations that do business and make profits in this 
country have an obligation to pay taxes in this country. Domestic 
companies that make profits in this country have an obligation as well. 
That obligation is to participate with ordinary Americans who 
understand that part of the cost of citizenship in this country is to 
help fund schools, pay for defense and pay for the social services that 
make this a great country. That is part of the obligation.
  We have some of the biggest economic interests who have decided they 
want to participate in every way of being an American except paying 
taxes. That has to stop. I hope this Congress will begin to take this 
seriously.
  This is the second GAO report we have done in the last 6 years on 
this subject. The tax avoidance problem is not getting better, it is 
getting worse. Tax loopholes are not getting narrower, they are getting 
wider.
  Again, as we near April 15, when Americans think about the obligation 
to pay taxes into this Government, I think it is shameful to get a 
report like this that says so many big economic interests that make so 
much money have decided they want all of the advantages America has to 
offer, but they do not want to pay taxes to the United States of 
America. That is a shameful situation and one we ought to fix.

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