The Levin brothers, Sandy and Carl, have come together to fight Democratic attempts to protect large multinational companies who have maintained massive tax shelters overseas.
As he did for much of his Senate career, Carl Levin has spoken out in favor of European Union investigations of tax favoritism for certain multinationals that critics say amounts to “state aid” for these corporations. And as he has done for decades in the House, Sandy Levin, the ranking Democrat on the Ways and Means Committee, is standing aside his brother on the offshore tax evasion issue.
Politico is reporting that Sandy Levin’s support for his brother, who retired from the Senate in 2014, puts him at odds with top Democrats on Capitol Hill who specialize in tax issues. Sen. Ron Wyden of Oregon, the top Democrat at Senate Finance, and Sen. Chuck Schumer of New York, viewed as the Senate Democratic leader-in-waiting, have both signed on to letters with Republicans decrying the state aid investigations into companies like Apple and Amazon.
In public statements, guest columns in newspapers and a video, Carl Levin is trying to keep his fight against tax shelters alive. With European nations aggressively investigating lucrative tax deals arranged by U.S.-based corporations, some Democrats have joined Republicans in claiming that these companies are facing harassment and a loss of privacy.
Politico’s “Morning Tax” blog indicates that Sandy Levin is on board with his brother’s forceful approach toward tax haven abuse, though he is a bit more muffled in his comments.
“He doesn’t give Europe carte blanche, but he doesn’t want them criticized for addressing an issue that needs to be addressed, and that Republicans here have been slow to address,” the congressman said.
In March, the Levin brothers denounced Sen. Bernie Sanders for false claims on the presidential campaign trail that a Panama trade agreement with the U.S. encourages more tax evasion by American companies. Those remarks were prompted by the expose of the Panama Papers, a trove of more than 11.5 million documents detailing offshore bank accounts used to avoid taxes by some of the world’s most powerful leaders.
Earlier this month, Carl Levin sharply criticized President Obama for a flip-flop in which he proposed legislation that essentially would put corporate privacy above a crackdown on “shell companies.” Levin, who as a senator repeatedly tried to force corporations to reveal the true owners of affiliates that served as shell companies, said that Obama’s proposal is “a significant step backwards.”
Meanwhile, the European commission ruled earlier this year that 34 multinationals have received sweetheart tax deals from Belgium so generous as to amount to illegal state aid. It has ordered Belgium to revise its tax settlements with the companies, charging them a combined $700 million.
According to The Guardian of London, at the heart of the ruling was an objection to Belgium’s so-called “excess profit” tax regime, which assumes that multinationals should be entitled to tax breaks because they have economies of scale. In practice it allows some international firms to reduce their Belgian tax burden by up to 90 percent, the commission found.
