America's largest companies are harboring more than $2.1 trillion in profits overseas to avoid paying taxes stateside, a report showed. The accumulated profits, if repatriated from places that include Bermuda, Ireland, Luxembourg and the Netherlands, would amount to an estimated $620 billion in U.S. tax revenue.
The study, which was conducted through two left-leaning nonprofit organizations and reported by Reuters, was able to calculate those figures by reviewing Securities and Exchange Commission filings from the companies. Around three-quarters of Fortune 500 companies take advantage of tax havens abroad.
The names on the list are, of course, recognizable to many. At the top was Apple, which has $181.1 billion. Microsoft holds $108.3 billion offshore in five tax havens, and Pfizer has $74 billion in 151 tax havens. General Electric has around $119 billion overseas in 18 overseas tax havens.
Just Apple, if their funds were repatriated, would pay as much as $59.2 billion in taxes.
"At least 358 companies, nearly 72 percent of the Fortune 500, operate subsidiaries in tax haven jurisdictions as of the end of 2014," the authors of the study wrote. "All told these 358 companies maintain at least 7,622 tax haven subsidiaries."
Tax evasion, a big problem for the IRS, keeps billions out of the federal coffers each year. For every $100 or so that is put into banks or investments, $8 is stored away overseas, a recent University of California, Berkeley, study found. The study, which attempted to quantify how much total wealth is being held in overseas accounts, estimated that sum of total overseas holdings at $7 trillion. That amount of cash could buy just about all of the gold in the world.
— maldon (@MiAldon) July 27, 2015
The issue clearly benefits the wealthiest members of society as they are the only ones capable of taking advantage of the tax evasion opportunities. The practice has been criticized for fueling inequality since it allows the rich to amass wealth.