Right now, Maine is losing out on millions of dollars each year because multinational corporations are taking advantage of loopholes and using accounting gimmicks to hide money overseas and avoid paying what they owe.

These tricks, mostly uncovered by company lawyers, enable these multinationals to funnel income through offshore tax havens like Liberia, Liechtenstein, Luxembourg and at least 35 other countries all over the world.

The Maine Legislature recently passed my bill to prevent multinational corporations from using these offshore tax havens to evade Maine taxes. Maine Revenue Services estimates that enacting the bill would allow Maine to recover $10 million for each two-year budget.

That’s $5 million per year in lost revenue that makes it harder for Maine to balance its books.

Gov. Paul LePage will have to decide whether he wants to stand up for the people of Maine and sign this bill or carry water for the biggest and most powerful corporations on earth and their tax haven benefactors.

It shouldn’t be that hard a choice.

While thousands of Mainers struggle to pay for the basics or even find a good-paying job, these multinational corporations are hiding money that should benefit all of the 1.3 million people in our state.

Hiding these taxpayer dollars forces the rest of us — individuals and Maine-based businesses alike — to pick up the tab. It’s money that could go to any number of key budget priorities, from revenue sharing to Head Start, to helping seniors afford medicine, to simply lowering property taxes for those who need it most.

This is all about fairness. Are you or any of your friends and neighbors able to hire an entire accounting firm and a full team of lawyers just to squeeze through a loophole and avoid paying taxes? I certainly don’t know anyone like that, and I am guessing most people don’t either.

Offshore tax evasion isn’t just a problem in Maine. These same multinationals avoid paying more than $20 billion per year in the rest of the country, a startling number when you consider that most people and small businesses don’t think twice about paying what they owe, even if they are not happy about it.

Alaska, Montana, Oregon and West Virginia have already enacted laws cracking down on these accounting practices, and other states are taking note and getting their own legislation in the works.

States are adopting these laws because Congress has been unable to remedy this problem. That approach is working.

Montana collected more than $7 million in 2010 from five tax havens, and Oregon expects to see $18 million annually. There is absolutely no reason why Maine can’t use existing resources to pursue and collect the tax dollars it is owed and achieve the same result as other states.

Maine already has laws on the books that prevent these multinationals from hiding money in our domestic tax havens like Delaware and Nevada. If we can outlaw the use of U.S.-based tax havens, then it should be a no-brainer to go after those who would rather hide their income in foreign countries than pay the Maine people what they owe.

Certain tax haven countries have lobbied Maine politicians to ask the Legislature not to pass my bill. But nothing I’ve read and no data I’ve examined can justify why any of these multinational corporations should go on cheating Maine taxpayers.

The governor has a choice to make: Do we side with the biggest fish in the sea, their army of tax lawyers and the haven countries that enable them to hide our tax dollars? Do we really pick Liechtenstein over Lewiston or Bahrain over Bangor? Or, do we choose the Maine people and get back the $10 million per budget that we are all owed?

Let’s make sure we come down on the side of fairness. Let’s make sure our tax laws reflect our values, not reward gimmicks that leave working Mainers and Maine businesses behind.

Rep. Adam Goode, D-Bangor, is serving his third term in the Legislature and co-chairs the Joint Standing Committee on Taxation.

Facebook comments