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Murray Closes $9.6 Billion in Corporate Tax Loopholes
Washington State Democrats took a victory lap over Senator Patty Murray's Medicaid/Education funding triumph on a conference call today. State Party Chair Dwight Pelz trotted out all of the data: Washington will be getting $320 million for Medicaid and $200 million to pay teachers from Sen. Murray's $26 billion amendment. That translates to 3,000 Washington teachers keeping their jobs and prevents Gov. Chris Gregoire from having to make 7.5 percent cuts across the board in addition to the $4 billion in cuts she already made this biennium.
And as Josh reported yesterday, the amendment is fully funded. In fact, some estimates say that the cost-offsets will reduce the deficit by $1.4 billion over the next four years.
But Senate-hopeful Dino Rossi has an issue with the way Murray funded her bill. The day after the amendment was attached, Rossi spokesperson Jennifer Morris called the amendment a "stopgap measure," and told PubliCola, "the measure proposed by Sen. Murray contained a permanent tax increase to pay for temporary spending."
We asked Morris to explain what she meant by "permanent taxes," and she promptly provided us with a list. She's right. But we're not talking about taxes on the middle class.
According to Julie Edwards with Senator Murray's re-election campaign, the provision Morris cited close tax loopholes for multinational corporations.
"The loopholes have allowed large, multinational corporations to get away with not paying their fair share of taxes for far too long. To be clear - they are supposed to be paying these taxes and are not," Edwards said.
And cursory research shows that Murray's camp is dead on. One of Morris' tax cites, Section 211, is titled "Rules to prevent splitting foreign tax credits from the income to which they relate." Sounds like closing a loophole to me. Section 212 is "Denial of foreign tax credit with respect to foreign income not subject to U.S. tax by reason of covered asset acquisitions." The rest of the revenue offset sections similarly deal with revising current tax code relevant to multinational corporations.
So, yes, the Murray amendment does mean that multinational corporations will be paying more taxes. On the other hand, those were taxes they were supposed to be paying in the first place—$9.6 billion worth.
And as Josh reported yesterday, the amendment is fully funded. In fact, some estimates say that the cost-offsets will reduce the deficit by $1.4 billion over the next four years.
But Senate-hopeful Dino Rossi has an issue with the way Murray funded her bill. The day after the amendment was attached, Rossi spokesperson Jennifer Morris called the amendment a "stopgap measure," and told PubliCola, "the measure proposed by Sen. Murray contained a permanent tax increase to pay for temporary spending."
We asked Morris to explain what she meant by "permanent taxes," and she promptly provided us with a list. She's right. But we're not talking about taxes on the middle class.
According to Julie Edwards with Senator Murray's re-election campaign, the provision Morris cited close tax loopholes for multinational corporations.
"The loopholes have allowed large, multinational corporations to get away with not paying their fair share of taxes for far too long. To be clear - they are supposed to be paying these taxes and are not," Edwards said.
And cursory research shows that Murray's camp is dead on. One of Morris' tax cites, Section 211, is titled "Rules to prevent splitting foreign tax credits from the income to which they relate." Sounds like closing a loophole to me. Section 212 is "Denial of foreign tax credit with respect to foreign income not subject to U.S. tax by reason of covered asset acquisitions." The rest of the revenue offset sections similarly deal with revising current tax code relevant to multinational corporations.
So, yes, the Murray amendment does mean that multinational corporations will be paying more taxes. On the other hand, those were taxes they were supposed to be paying in the first place—$9.6 billion worth.
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