A California state assemblyman has drafted legislation
aimed at closing corporate tax loopholes he claims are operated out of offshore
financial jurisdictions like the Cayman Islands.
“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,” said California
Assembly Member Marty Block (D-San Diego) on the California Progress report
has dubbed his legislation the ‘Cayman Islands Tax Loophole Bill’.
might have heard about a single building in the Cayman
Islands that houses almost 19,000 shell corporations,” he said. “Corporations transfer their profits to these
fake companies so they don’t have to pay taxes.”
which would have effect only in the US
state of California,
would take money from multinational corporations who Mr. Block said are taking
advantage of the state’s corporate tax loopholes, and use that money to pay for
a tax cut on college textbooks and supplies.
proposal would only tax those corporations if the money subject to the
corporate tax was made in California.
has been approved by the California
assembly by the bare minimum of votes required. It would also have to be passed
by the state senate before going to Governor Arnold Schwarzenegger for
analysts have stated the bill is part of California’s
attempt to balance its budget deficit without actually raising taxes on state
Republican Party leaders in California have
said Mr. Block’s proposal would discourage businesses from operating and
investing in California.