Thu February 21, 2013
Groups Say Public Financing of Campaigns Could Close Corporate Tax Loopholes
A group pressing for public campaign financing has compiled a list of large corporations who gave hundreds of thousands of dollars to some New York lawmakers. They charge that the donations are preventing the legislature from closing what they say are corporate tax loopholes.
The data, originally compiled by the US Public Interest Research Group, finds 17 companies, including Bank of America, Citigroup, PepsiCo and Pfizer shelter billions of dollars in annual profits in off shore tax havens. The group estimates that if those profits were reported on New York State income tax forms, it could bring $2.4 billion dollars in additional revenue to cash strapped state coffers. Sara Niccoli, with the Labor Religion Coalition, says that money should be used to help fund needed government services.
“Ordinary people have problems meeting their health care needs,” said Niccoli. “ And are having a hard time finding good jobs that pay a living wage.”
The 17 corporations also gave over $670,000 dollars to New York State politicians in the last election cycle.
Karen Scharff, with Citizen Action, says the bulk of the money went to the campaign committees for the majority party in power in each house of the legislature, the Republican Senate Campaign Committee, and the Democratic Assembly Campaign Committee.
She says lawmakers in both houses have been reluctant to pass legislation to close corporate tax loopholes that keep the companies’ profits in the off shore tax shelters, despite the state’s continuing fiscal shortages. Scharff admits there’s no actual proof, though, to connect the campaign donations and the state’s tax policy for corporations.
“You can never tie a specific policy to a specific to campaign contribution,” Scharff said. “But you can tie the overwhelming preponderance of behavior. ”
The groups say they’d like a law requiring corporations to report, on their New York State income tax statements, their total global profits and pay taxes on them. They admit they don’t have a single sponsor in the legislature.
But Scharff says a matching public campaign finance system could also help solve the problem, because candidates would not have to go to big money donors in the first place.
“There’s very few people who want to give a larger campaign contribution because they just like the person,” she said.
The State’s Business Council says the reforms that the groups are proposing would not guarantee a fair playing field. They say the proposal does not taking into account the collective power of labor unions, which, under present laws, can in some cases donate more money to candidates than corporations.
Governor Cuomo is seeking public financing of campaigns as part of a reform the state’s current campaign laws. His proposal is expected later in the spring. Democrats in the Assembly and Senate support the idea, but Republicans, who govern the Senate in a joint leadership coalition, have been reluctant so far to sign on.