ACHIEVING TAX FAIRNESS BY CRACKING DOWN ON OFFSHORE TAX HAVENS

WHEREAS, revelations that a Panamanian law firm helped set up more than 200,000 offshore shell corporations have shined a light on the vast amount of income and wealth flowing into offshore tax havens; and

WHEREAS, as much as $20 trillion from individuals may be stashed away in dozens of offshore tax havens; and

WHEREAS, this tax avoidance adds tremendously to global inequality between the rich and poor, is a source of political corruption and impedes economic development; and

WHEREAS, U.S. corporations hold $2.1 trillion in profits offshore—much in tax havens—that have not been taxed in the United States; and

WHEREAS, U.S. corporations avoid $150 billion a year in income taxes by shifting profits to subsidiaries in tax havens; and

WHEREAS, state revenue systems lose $39.8 billion in tax revenue a year due to offshore tax havens, and these revenue losses can have a significant impact on state budgets already under tremendous fiscal stress; and

WHEREAS, tax avoidance through offshore tax loopholes is a significant reason why corporations, which paid one-third of federal revenues 60 years ago, now pay only one-tenth of federal revenues; and

WHEREAS, U.S. lawmakers could limit corporate tax avoidance by requiring American corporations to pay U.S. taxes on their offshore subsidiary profits, but they are instead proposing tax-free repatriation of offshore profits; and

WHEREAS, U.S. lawmakers are resisting global disclosure standards, and this has allowed the United States to be rated by the Global Tax Network as one of the 10 worst tax havens; and

WHEREAS, Connecticut, Montana and Oregon have passed laws that start to combat offshoring by requiring companies to declare not only the income earned by subsidiaries in other states but also the income stored in statutorily identified tax havens:

RESOLVED, that the American Federation of Teachers will continue its work to raise awareness about the high cost of tax avoidance among AFT members, elected leaders, coalition partners, and the parents, students, patients and taxpayers who rely on the services provided by AFT members; and

RESOLVED, that the AFT will work with locals and the trustees of their pensions to consider divesting from corporations that benefit most from tax evasion and through the use of loopholes and offshore tax havens; and

RESOLVED, that the AFT will work in coalition with unions globally through Public Services International, Education International and similar bodies to support tougher regulation of international private banking, increased transparency through public official wealth declarations and beneficial ownership registration, and a global wealth tax on anonymous wealth; and

RESOLVED, that the AFT will work at the federal level advocating for the closure of offshore tax loopholes and greater sanctions on those who work to undermine the stability and fairness of public revenue systems; and

RESOLVED, that the AFT will work with state federations and other partners at the state level advocating for better reporting of income placed in tax havens and to otherwise combat offshoring of revenues for tax avoidance.