Tax Havens: International Tax Avoidance and Evasion

"Addressing tax evasion and avoidance through use of tax havens has been the subject of a number

of proposals in Congress and by the President. Actions by the Organization for Economic Cooperation and Development (OECD) and the G-20 industrialized nations also have addressed this issue. In the 111 thCongress, the HIRE Act (P.L. 111-147) included several anti-evasion provisions, and P.L. 111-226 included foreign tax credit provisions directed at perceived abuses by U.S. multinationals. Numerous legislative proposals to address both individual tax evasion and corporate tax avoidance have been advanced..."

Tax havens

Tax Havens: International Tax Avoidance and Evasion
"The federal government loses both individual and corporate income tax revenue from the shifting
of profits and income into low-tax countries, often referred to as tax havens. The revenue losses
from this tax avoidance and evasion are difficult to estimate, but some have suggested that the
annual cost of offshore tax abuses may be around $100 billion per year. International tax
avoidance can arise from large multinational corporations who shift profits into low-tax foreign
subsidiaries or wealthy individual investors who set up secret bank accounts in tax haven
countries.

Recent actions by the Organization for Economic Cooperation and Development (OECD) and the
G-20 industrialized nations have targeted tax haven countries, focusing primarily on evasion
issues. The recently adopted HIRE Act (P.L. 111-147) included a number of anti-evasion
provisions, and P.L. 111-226 included foreign tax credit provisions. Some of these proposals, and
some not adopted, are in the American Jobs and Closing Loopholes Act (H.R. 4213); the Stop Tax
Haven Abuse Act (S. 506, H.R. 1265); draft proposals by the Senate Finance Committee; two
other related bills, S. 386 and S. 569; the Bipartisan Tax Fairness and Simplification Act (S.
3018); and proposals by President Obama..."