California lawmaker goes after Cayman Islands
(CNS): One of California’s lawmakers has pushed a bill through the state assembly to clampdown on US firms using the Cayman Islands to avoid tax and divert the money to college students. The Assembly passed Marty Block’s (D-San Diego) bill with a 41-28 vote to temporarily close a loophole allowing companies to create tax havens in other countries. It will now go to the state Senate. The aim is that corporations would pay taxes on offshore accounts only if the money was made in California, said Christopher Ward, Block’s chief of staff. The accounts would be reported on a company’s income tax return with the state Franchise Tax Board.
"If you raise your revenues in California, you can’t get away with not paying taxes simply by setting up a shell corporation tax structure in a tax haven," Assemblyman Ira Ruskin, D-Redwood City, said during the floor debate.
On the California Progress Report site Block said that one of his top priorities when he came to the Assembly was to eliminate corporate tax loopholes.
“With a grim economy and no-win budget choices, it’s clear that making big business pay their fair share of state tax is more important than ever. To do this I’ve introduced the Cayman Islands Tax Loophole Bill,” he wrote. “You might have heard about a single building in the Cayman Islands that houses almost 19,000 shell corporations. Corporations transfer their profits to these fake companies so they don’t have to pay taxes. Meanwhile, the rest of us get stuck paying more for the services our state needs.”
He said his bill would take money from the Cayman Island Tax Loophole and applies it directly to pay for a tax cut on college textbooks and supplies.
Republicans characterized the bill as a tax increase that would encourage businesses to leave California. "You’re killing companies, you’re discouraging everybody from coming to California, you’re hurting the future of our children that we’re trying to educate," said Assemblywoman Diane Harkey, R-Dana Point.
If passed into law the bill would reduce the state sales tax college students pay on books and supplies by 2 percent between that date and June 30, 2012. After that, the state tax would be eliminated altogether for college students, leaving them to pay only local sales taxes. The California Franchise Tax Board estimated that corporations would pay a total of $70 million in additional taxes during the year following the bill’s implementation. They would pay $120 million each fiscal year after that through mid-2014, and $50 million in the final year until the law expires in mid-2015.
Gov. Arnold Schwarzenegger, who has pledged not to raise taxes, has not taken a position on the bill.
Category: Business
Does anyone know if the Hostage takers from Paul Blart: Mall Cop ever did make it to Cayman with their millions? I missed the ending!
Dear Mr. Marty,
First and foremost, if you do what you say you would like to do, don’t you think that businesses will leave California? The logical answer is yes, just in case you did not know. Furthermore, if businesses leave this would result in a lost of jobs. Do you think that your state would be pleased with that? The logical answer, is no. So, Mr. Marty, I recommend that you listen to the Assemblywoman Diane Harkey, and also think of another approach to your mysterious ‘plan’. Accordingly, please don’t hate, and I kindly ask you to leave the Cayman Islands be.
Yours Truly…
polictical grand standing.
Nobody knows who this guy is and he is trying to get his name out there.
What better way than to bad mouth Cayman?
Most Americans only know what Hollywood and CNN tell them and so he is trying to ride on the coat tails.
Ok Marty,
What about the building in Delaware that houses over 300,000 corporations!?
The states of Delaware and Nevada are in fact "offshore banking jurisdictions" within the USA landmass – as is London in the UK … go figure huh?
Honestly, the hypocrisy and bullcrap that is trickling down upon the headtops of everyday people today is astounding.
Tax havens , man-made global warming, internet censorship, wars on terror, terrorism, the military industrial complex … (sigh).
The saddest thing of all is that NONE of these "battles" are being fought or agendas promoted with good intentions or honest convictions – behind the curtain of every last one is someone attempting to make another dollar.
Jah – come take back your world please … and quick! Far too many parasites and bloodsuckers in the high chairs.
whodatis
Thanks for the advice. But want to know where all your money is really going and where it went Marty?
Unethical wars
Unethical bailouts and bonuses
Unethical health providers
Unethical defence contractors
Unethical pork barrelling
Due to unethical campaign financing
Unethical evangelical churches receiving unethical tax free status
An unethical Federal Reserve
Handing out free money
To unethical Wall Street friends
An unethical Internal Revenue giving unannounced tax breaks to the same unethical bankers
Unethical Presidents who removed all forms of ethical regulation of the financial services industry
I could go on.
But one more thing while y’all had your heads buried up your ass….
An unethical and incompetent President who left you in tremendous debt.
Upwards of 7 trillion and counting isn’t it?
Get real and good luck blaming Cayman.
It’s about time that tax loopholes are closed off. The Cayman Islands ought to find some other businesses to engage in – turtling comes to mind…
Why dont you go take a hike over the Devils Triangle?
Somebody flatten your trailer tires again?
This would be a good one for the Financial Services Assn. to take on. Educate and enlighten the Gov. of california on the Cayman reality. The govt. should regourously defend and seek to destroy that bill. It is insulting to a nation of people to include our country’s name in his bill. He has singled us out. Then uses the misguided statement of the President, in his bid to brown nose, then link it to an emotive local issue of college student textbook payments, all in the attempt to justify his ignorant move. Against the sovereign and ligit business of offering Financial Services, this gentleman is seeking to wrap our country name in a bill to further smear us in Hollywood town. It is wrong, in my view illegal (intl. law) and our chief defender or his office with the Financial Services Assn should attack this. They out of order…to use a Jacan slang.
Marty Block like Arnold and Obama need to educate them selves first on what the Cayman Islands is all about. Its not the Cayman Islands thats hurting their budgets, its thier extravagant cockeyed spending, tax,tax and more taxes until the people get fed up with it and want to move, cry all you want you liberals but your people are sick of your high taxes with no representation, talk about a tea party, it hasnt come yet for you.
What will Sherri and Mac tell us now more Key employees and shorter time What a joke is being played on the Caymanian people. What will be the next excuse?