Legislature moves to close Wal-Mart loophole

Congratulations to legislative leaders from both houses and both parties, who agreed to close Wal-Mart's notorious real estate tax scam as part of the state budget repair bill.

If enacted, the measure would shut down Wal-Mart's (and unknown others') use of intricate tax techniques to avoid taxes by paying rent to itself.

It's a relatively small fix (estimated to bring in $15 million this biennium) but an important first step in much-needed corporate tax reform. It's a change IWF has long urged.

For more details, see:
» IWF press release
» Statement by Sen. Majority Leader Russ Decker
»Analysis by Legislative Fiscal Bureau (see item #24)

Florida's The Tampa Tribune published a superb editorial endorsing combined reporting, the tax reform that closes the loopholes that allow big companies to shift profits from one state to another.

The Tribune said: “Florida allows multistate businesses to shelter Florida income in other states. This makes the effective income-tax rate on small Florida businesses higher than the rate paid by corporations sheltering income elsewhere…Finding legal ways to collect taxes that are already on the books is not a tax increase. This year, with revenues falling far short of covering basic priorities, the Legislature should take a serious look at a few revenue-generating reforms.”

Combined reporting is included in the Wisconsin Senate’s budget-repair bill. It’s a long-overdue reform.

Past news stories...

• Milwaukee County Board supports corporate disclosure—February, 2008
• Revenue, not cuts, solution to budget shortfall —February, 2008
• IWF Director Karen Royster's op-ed on tax disclosure "Bill on tax disclosure is worthy"—January 3, 2008