Politicians in Annapolis keep telling us taxes and fees have to be raised to meet the state’s transportation needs. But if a study released by a public interest group is accurate, the state could pay for much of that need by closing tax loopholes.
The Maryland Public Interest Research Group (MaryPIRG) said Maryland lost $966 million in 2012 due to offshore tax dodging.
Nationwide, companies using foreign tax havens were able to divert $40 billion from U.S. tax coffers.
In Maryland’s case, MaryPIRG said had the tax dodgers paid their state taxes, Maryland would have enough funding to cover the Red Line in Baltimore or the Purple Line in Prince George’s and Montgomery counties.
Cutting government waste and closing tax loopholes always seems to be a last resort in state capitals.
Instead of piling on more taxes and more fees for services, state government should look within for solutions.
MaryPIRG argues that states should not wait for federal action to curb tax haven abuse. Instead, it proposes several policy solutions, including:
• Decoupling state tax systems from the federal system.
• Requiring worldwide combined reporting for multinational corporations.
• Requiring increased disclosure of financial information.
• Withholding state taxes as part of federal FATCA (Foreign Account Tax Compliance Act) withholding.
Is anyone in Annapolis listening?