But there is little appetite in Congress for taking on powerful tax dodgers in the U.S., where the practice has become commonplace.
A request for comment about the Panama Papers to the two congressional committees charged with tax policy — House Ways and Means and the Senate Finance Committee — was ignored.
The reluctance by congressional leaders to tackle tax dodging is nothing new, especially given that some of the largest companies paying little to no federal taxes are among the biggest campaign contributors in the country. But there’s another reason to remain skeptical that Congress will move aggressively on tax avoidance: Former tax lobbyists now run the tax-writing committees.
We researched the backgrounds of the people who manage the day-to-day operations of both committees and found that a number of lobbyists who represented world-class tax avoiders now occupy top positions as committee staff. Many have stints in and out of government and the lobbying profession, a phenomenon known as the “reverse revolving door.” In other words, the lobbyists that help special interest groups and wealthy individuals minimize their tax bills are not only everywhere on K Street, they’re literally managing the bodies that create tax law:
- Barbara Angus, the chief tax counsel of the House Ways and Means Committee, became a staff member in January of this year after leaving her position as a lobbyist with Ernst & Young. Angus, registration documents show, previously helped lobby lawmakers on tax policy on behalf of clients such as General Electric, HSBC, and Microsoft, among other clients.
- Mark Warren, a tax counsel for the tax policy subcommittee of Ways and Means, is a former lobbyist for the Retail Industry Leaders Association, a trade group that includes Coca-Cola, Home Depot, Walgreens, and Unilever. Warren, who joined the committee in November of last year, previously lobbied on a range of tax policies, including tax credits and “tax relief.”
- Mike Evans became chief counsel for the Senate Finance Committee in 2014 after leaving his job as a lobbyist for K&L Gates, where he lobbied on tax policy for JP Morgan, Peabody Energy, Brown-Forman, BNSF Railway, and other corporate clients.
- Eric Oman, the senior policy adviser for tax and accounting at the Senate Finance Committee, previously worked for Ernst & Young’s lobbying office, representing clients on tax policy.
A request for comment about the role of former lobbyists now working as staffers was also ignored by the committees.
Wealthy individuals and corporations routinely squirrel away vast sums of money in jurisdictions like Delaware or Wyoming to avoid taxation, a major factor in the current state of affairs that allows those at the top of the economic pyramid to pay an effective tax rate that is often lower than the middle class. Verizon, Boeing, and General Electric, to name a few, paid no federal income taxes in recent years, despite earning a hefty profit margin. The Tax Justice Network ranks the U.S. as the third most problematic tax haven country, a ranking even worse than Panama.
Author: Lee Fang