Wolf Pursues Cost of Tax Loopholes

Simply put, tax loopholes tend to benefit large corporations which can afford to hire the accountants and administrative personnel necessary to take advantage of them. Small businesses that cannot then end up paying taxes while the larger businesses avoid them.

Congressman Frank Wolf has been pushing for a closer look at the impact of tax loopholes on taxpayers. He drew attention to General Electric’s mega-tax return, which allowed the corporation, with $14 billion in 2010 profits, to avoid U.S. taxes altogether.

In a letter to IRS Commissioner Douglas Shulman, Wolf pointed to a recent article in the Weekly Standard that said the company’s 2010 electronic return was an estimated 57,000 pages long and would have been 19 feet high if printed out and stacked.

“A return of this magnitude was clearly necessary to take advantage of every loophole and earmark in the tax code to avoid paying federal taxes,” Wolf wrote Shulman.

Wolf asked Shulman “how many hours of IRS employees’ time was spent reviewing this return and what was the total cost to the government?”

If complexity in the tax code inhibits economic productivity, then it would stand to reason that eliminating tax loopholes favored by large corporations would allow for across the board tax rate reductions that would benefit all taxpayers, stimulate economic growth, and, ultimately, bring in additional tax revenue.

Contribute for Conservatism!

About the author

E M Barner

E M Barner, the blogger formerly known as DCH / De Civitate Hominis (“concerning the city of man”), writes from a Northern Virginia perspective. Barner has been active in Republican politics and policy since 1994 – as a grassroots volunteer, party leader, and professional.