Senator Sanders Proposes Corporate Tax Reform
In a bold move to overhaul the corporate tax system, Sen. Bernie Sanders has introduced the Corporate Tax Dodging Prevention Act. This legislation is designed to close the loopholes that have enabled corporations to significantly reduce or even eliminate their federal tax obligations. The bill targets strategies such as the use of offshore tax havens and manipulations that exploit the low statutory corporate tax rate.
With the introduction of this bill, Sanders aims to level the playing field by ensuring corporations pay the same rate on offshore income as they do on domestic earnings. This would prevent companies from benefiting from lower tax rates on income held in offshore bank accounts. The bill also seeks to repeal a tax break from the Trump era, which has been criticized for encouraging companies to move assets and operations abroad.
One of the most significant changes proposed is the restoration of the corporate tax rate to 35 percent, a stark increase from the 21 percent rate established by the GOP’s 2017 Tax Cuts and Jobs Act. This act has been associated with a surge in wealth for the rich and corporations, while Sanders and supporters of the bill argue it has done little for working families.
According to projections by the Joint Committee on Taxation, this reform could generate an additional $2.3 trillion in tax revenue over the next decade. Sanders has been vocal about his stance on the current tax system, which he believes favors the wealthy and powerful at the expense of ordinary workers.
Recent studies, including one by the Government Accountability Office, have revealed that a significant portion of large, profitable corporations paid no federal income taxes following the implementation of the GOP tax bill. The Institute on Taxation and Economic Policy further highlighted that companies like Amazon and Netflix have paid minimal or no federal taxes in recent years.
As corporate profits soar to new heights, partly due to inflation and what Sanders terms “corporate greed,” there is a growing call for these entities to contribute their fair share to federal revenue. The U.S., as noted in a press release regarding the bill, collects a smaller percentage of total revenue from corporate taxes compared to mid-20th century figures and lags behind other OECD countries in this regard.
The companion legislation in the House, introduced by Rep. Jan Schakowsky, signifies a concerted effort by lawmakers to address what they see as inequities in the tax system. The proposed reforms could mark a significant shift in how corporations are taxed in America, with potential implications for federal revenue and economic inequality.
