Lawmakers Argue Against Pro-Accenture Change to Tax Bill

Lawmakers Argue Against Pro-Accenture Change to Tax Bill

- Letter to Chairmen Calls Change Unfair to U.S. Companies Who Pay Taxes -

WASHINGTON, D.C. - House and Senate lawmakers today argued against adding a special provision to the tax technical corrections bill that would shield Accenture from paying millions of dollars in U.S. taxes on its international profits. Accenture, which was formerly a part of Arthur Anderson, moved its corporate headquarters from Chicago to Bermuda in 2001. News reports have stated that Accenture has been lobbying for this provision to be included in the bill, which is expected to be introduced shortly.

U.S. Senator Carl Levin, and U.S. Representatives Rosa L. DeLauro (Conn.-3), Richard Neal (MA-2), Louise Slaughter (NY-28), Lloyd Doggett (TX-25), Marion Berry (AR-01), and John Lewis (GA-05) today sent a letter to Senate Finance Committee Chairman Charles Grassley and Ranking Member Max Baucus and House Ways and Means Chairman Bill Thomas and Ranking Member Charlie Rangel.

"This is a question of responsibility," wrote the lawmakers. "Hard-working Americans, Mom and Pop small businesses, and thousands of corporations with integrity meet their responsibilities by paying their fair share of taxes. Accenture chose a different path: pushing its share of the burden onto others. The Committee had it right last year: Accenture's inversion transaction was obviously a means of avoiding U.S. taxes and it should be curtailed - not condoned and rewarded," wrote the lawmakers.

The lawmakers stated that they would oppose the normally non-controversial corrections bill should this provision be included.

Congress passed the American Jobs Creation Act last year, specifically condemning the practice of corporate expatriation, while exempting those companies which had already incorporated overseas.

The full text of the letter follows.

The Honorable Charles Grassley The Honorable Max Baucus
U.S. Senator U.S. Senator
Chairman Ranking Member
Finance Committee Finance Committee
219 Dirksen Office Building 511 Hart Office Building
Washington, DC 20510 Washington, DC 20510

The Honorable Bill Thomas The Honorable Charlie Rangel
Member of Congress Member of Congress
Chairman Ranking Member
Ways and Means Committee Ways and Means Committee
1102 Longworth Office Building 2354 Rayburn Office Building
Washington, DC 20515 Washington, DC 20515

July 19, 2005

Dear Chairmen Grassley and Thomas and Ranking Members Baucus and Rangel:

The Wall Street Journal reported July 14th that, as drafters of a technical corrections bill, you are contemplating including a special provision to shield Accenture from the anti-inversion provisions passed as part of last year's international tax law. Writing new rules with the specific purpose of allowing Accenture to avoid paying millions of dollars in U.S. taxes on its international profits would be extremely unfair to U.S. companies who pay their fair share. We urge you not to incorporate these controversial measures into the legislation.

When Congress passed the American Jobs Creation Act last year, it specifically condemned the practice of corporate expatriation. The House report accompanying the legislation states, "The Committee believes that certain inversion transactions are a means of avoiding U.S. tax and should be curtailed." The Committee had it right last year: Accenture's inversion transaction was obviously a means of avoiding U.S. taxes and it should be curtailed -- not condoned and rewarded.

This is a question of responsibility. Hard-working Americans, Mom and Pop small businesses, and thousands of corporations with integrity meet their responsibilities by paying their fair share of taxes. Accenture chose a different path: pushing its share of the burden onto others. The Finance Committee and the Ways and Means Committees both have responsibilities of their own: to protect the taxpayers who play by the rules. Those Committees will hopefully assume that responsibility and reject this unworthy effort to flout the laws that bind everyone else.

The technical corrections bill need not be a contentious piece of legislation. However, if the provisions exempting Accenture remain, we will oppose the legislation vigorously.

Sincerely,

Senator Carl Levin, Richard Neal, Lloyd Doggett, Rosa DeLauro, Marion Berry, Louise Slaughter, John Lewis

http://www.house.gov/delauro/press/2005/July/accenture_letter_07_19_05.html