It appears that the American worker and American consumer are not the only ones over-taxed in America. Apparently some American corporations feel they are paying too many taxes as well. According to a recent New York Times article, the trend of multinational corporations moving their headquarters to tax-friendly Bermuda is catching fire.
Stanley Works, a toolmaker who has been headquartered in Connecticut for the past 159 years, has decided to go with plans to relocate to Bermuda, saving the company almost $30 million a year in taxes. Since Stanley gets a portion of its profits from outside the U.S., it will continue to pay some taxes, but it won't have to pay income tax to America since it's headquarters will no longer be in America. Bermuda has no income tax.
Such moves by companies like Stanley will tear at our social fabric and our national infrastructure as well. Our government is seriously in debt enough, and this shortfall of tax revenue is the reason many of our schools are failing and our health care system is in crisis. It is also the reason there never seems to be enough budget money through tax collections to cover all the social benefits and programs that "We, The People" have mandated that our government provide.
There is now no difference between soon-to-be former American companies like Stanley and other foreign companies like Honda, Toyota and BMW. They may employ some American workers, but since they are not headquartered here, they basically pay no U.S. taxes to America. One can only hope that this tax-evasion scheme will shed the light on the disparity of production cost burdens like wage rates and regulation between foreign producers and American producers. Whether the subject is overseas manufacturing or setting up headquarters overseas, both are examples of subsidies for either foreign companies or foreign producers since they are exempted from taxes that American companies employing their own people must pay.
It is not often that I agree with Representative Charles Rangel from New York, but I agree with his statement that reads "Some companies flying the Stars and Stripes renounce America when it comes to paying their taxes." I would add that some companies show their true colors when they are forced to choose between profits and patriotism. Stanley is apparently about to show us their true colors, and they are definitely not red, white and blue.