$13 Trillion Untaxed in Offshore Accounts

Corporations, federal contractors, and well to do individuals keep approximately $13 trillion in offshore accounts according to the US Government Accountability Office. Uncle Sam wants to collect taxes on those accounts.

The federal government found that 83 of the United States's top 100 publicly traded corporations held subsidiaries in tax havens, as did 63 of the top 100 federal contractors. Recipients of federal bail out money, like Bank of America, Morgan Stanley, and Citigroup, have several offshore subsidiaries too.

Rep. Lloyd Doggett introduced the Stop Tax Haven Abuse Act in May 2009. At Doggett's side, President Obama stated that companies are taking advantage of legal loopholes by shifting profits to tax havens. The president continued, "[T]hese tax havens make our system less fair and harm the U.S. economy."

The bill targets specific countries, including Switzerland, Panama, Samoa, the Isle of Man, and the Cayman Islands, among others. The Cayman Islands Stock Exchange chairman Anthony Travers takes issue with the President's terminology. Travers states that most of the rhetoric is not about "tax loopholes" but "perfectly clear provisions of U.S. tax law."

The Cayman Islands is a British territory of about 100 square miles. Claiming the territory as home are 80,000 companies, 7,000 mutual funds, 270 banks, and 1,000 insurance companies.

Travers describes the Cayman's residents' response to the President's comments as "outrage tinged with concern" but predicts that proposed tax law changes will have "marginal to no effect" on the Islands.