Support bill to close corporate tax loopholesPublished 12:11pm Wednesday, May 2, 2012
Over the past two years, our schools have seen unprecedented cuts to teachers and support staff, while classroom size has increased and supply funds have been slashed. The top priority of this Legislature should be finding solutions to bring more money into our schools through increasing revenue to the Education Trust Fund.
One such solution is closing tax loopholes for large, out-of-state corporations that do business within our state. I am currently sponsoring a bill that closes these tax loopholes (SB333) and if passed, would provide an estimated $60 million to our schools starting next year.
Most importantly, this legislation will not have an adverse impact on Alabama small businesses and does not raise taxes. This bill simply targets large, out-of-state corporations that currently do not pay income taxes within our state. For example, in 2006, Exxon Mobile made $90 million in Alabama and paid zero taxes to our state.
Taxpayers should feel that it is unjust that large corporations don’t give back a cent in taxes, but start-up small businesses in Alabama pay their share. We all should want small business owners to succeed because they are critical to the economy, just as the large, out-of-state companies.
Just like Exxon, there are certain corporations that make millions of dollars of profit in Alabama and yet, pay fewer taxes than the average individual taxpayer. In 2005, over 1,000 out-of-state corporations doing business in Alabama made income of $105 billion and paid zero taxes. This legislation would change this unfair policy and at the same time, provide millions of dollars to save our schools during these difficult economic times.
SB333 is based on the principle of transparency. If a corporation makes money in the State of Alabama, it should be required to disclose those profits and pay taxes. The current law that allows a large, out-of-state corporation to shift the reporting of its profits to a zero tax state and not pay a cent to Alabama must be changed. My goal is to simply require global corporations to pay their fair share of taxes that go directly to our schools, children and classrooms.
Fortunately, my bill passed favorably out of committee last week. My hope is that the Republican supermajority will give SB333 the opportunity for a vote on the Senate floor before the legislative session closes.
Furthermore, I continue to try to prevent the legislature from balancing the budget on the quality of education for our children. I remain opposed to policies that cut educators, raise classroom size and provide less funding to our classrooms because educators and our children should not have to pay the price for budgetary shortfalls.
This legislation is just one example of how I continuously work to safeguard our schools. You can rest assured that education will remain a top priority of mine in the legislature because Alabama children and their learning environment are our state’s future and they must be protected. Therefore, I hope that SB333 will be enacted into law without delay so that our state is one step closer to providing the necessary revenue that our schools so desperately require.
Senator Marc Keahey