The Government Accountability Office has cited a number of insurance companiesas having subsidiaries in areas classified as tax havens.
They include American International Group Inc., Berkshire Hathaway, Hartford Financial Services Group Inc., MetLife Inc., Travelers and UnitedHealth Group Inc.
Sen. Byron Dorgan, D-N.D., and Carl Levin, D-Mich., requested the report as part of their continuing effort to impose tighter controls on corporations’ use of offshore tax havens to reduce their U.S. taxes.
Dorgan and Levin contend that U.S. companies use offshore tax havens to save an estimated $100 billion in taxes each year.
They also said in a statement “that many of these companies are paid with taxpayer dollars, and some have also received billions of dollars in taxpayer bailout funds.”
Other insurers cited in the report include Aetna Inc., Allstate Corp. and Prudential Financial Inc.
Prudential has the most of these affiliates, 27, followed by MetLife with 19 and AIG with 18. United Health was reported to have 11, Hartford 10 and Aetna 8. Berkshire Hathaway and Allstate each have only offshore tax haven sub.
But the GAO report noted a criticism by the IRS about using a list of tax havens or financial privacy jurisdictions “because there is no agreed-upon definition of tax havens or list of jurisdictions.”
GAO officials noted, too, that the jurisdictions on the 3 lists used have similar characteristics. “Further, background for one list said that industry analysts recognize them as offshore tax haven or financial privacy jurisdictions and that they are promoted as such,” the report said.
The report said 83 of the 100 largest publicly traded U.S. corporations in terms of 2007 revenue reported having subsidiaries in jurisdictions listed as tax havens or as financial privacy havens. Of the 100 largest publicly traded U.S. federal contractors in terms of fiscal year 2007 federal contract obligations, 63 reported having subsidiaries in such jurisdictions.
“This report shows that some of our country’s largest companies and federal contractors, many of which are household names, continue to use offshore tax havens to avoid paying their fair share of taxes to the U.S.,” Dorgan and Levin said.
Some of those companies have even received emergency economic funds from the government, Dorgan said. “I think we should take action to shut down these tax dodgers, and we will be introducing legislation to do just that,” he added.