AUGUSTA, Maine — The Maine Center for Economic Policy (MECEP) applauds Maine state legislators for their efforts to level the playing field for Main Street businesses and raise revenues that provide critical resources for workers and families throughout the state by stopping corporations from exploiting a loophole to lower their US profits on paper and avoid paying Maine income taxes.
LD 428, An Act To Prevent Tax Haven Abuse will take steps toward deploying ‘worldwide combined reporting’ as a method to require corporations and their subsidiaries to report global profits and pay taxes based on the portion of their business that is done in Maine.
Huge, multinational corporations such as Apple, Pfizer, ExxonMobil and Google, use offshore tax havens to avoid paying taxes on billions of dollars of profits every year. These corporations benefit from Maine’s public investments but aren’t paying their fair share in taxes to support the public services that make Maine a good place to do business. Corporations exploit the tax havens loophole to avoid up to $52 million of Maine taxes annually, according to a 2020 report by MECEP.
“I came into the Legislature with serious concerns about tax fairness in our state,” said bill sponsor Representative Denise Tepler. “I am proud that this bill will set up the next legislature to stop corporations from hiding profits in off-shore tax havens and forcing other Maine tax payers to pick up more than their fair share.”
“When Maine communities thrive, so do the corporations that do business here,” said Sarah Austin, MECEP director of policy and research. “But when profitable corporations build their wealth by manipulating the tax code and hiding their profits to avoid paying taxes, it is workers, small businesses, and our communities — not CEOs or shareholders — who are harmed.”