Action on Corporate Tax Inversions Will Help Level the Playing Field for Small Businesses

The Treasury Department̢??‰?s announcement that it will use regulatory authority to take action on a corporate tax loophole, called an inversion, is good news for small business owners. The Treasury Department̢??‰?s decision will help level the playing field for entrepreneurs by limiting the tax benefits of a loophole that gives big companies an unfair advantage over small businesses.

Inversions allow corporations to purchase a company in a tax-friendly nation in order to relocate their headquarters to save money on taxes. For all intents and purposes the corporation remains a U.S. company, just enjoying a lower tax rate, but their tax burden is then shifted to small businesses and consumers.

Small business owners are tired of doing their part while big corporations use unfair loopholes to shirk their obligation to the nation that helped make them successful. In fact, Small Business Majority polled a random sample of entrepreneurs across the country and found nine in 10 owners say the practice of U.S. multinational corporations using accounting loopholes to shift their U.S. profits to offshore subsidiaries to avoid taxes is a problem, and they support eliminating these tax breaks and providing incentives to bring production home.

What̢??‰?s more, 75 percent say their small business in particular is harmed when big corporations use loopholes to avoid taxes, and a sweeping 90 percent believe big corporations use loopholes to avoid taxes that small businesses have to pay.

When large corporations don̢??‰?t pay their fair share, it hurts small businesses, our economy, our ability to invest in our national infrastructure and so much more. We hope to see more actions to limit corporate tax loopholes that give large corporations an unfair advantage over small businesses.