US companies exploiting tax loopholes
A former leasing executive has told a senate hearing that large US companies are gaining massive tax deductions by exploiting a loophole in the country's tax law.
Speaking behind a partition and masked by a voice scrambler, the man, using the name, ‘Mr. Janet’ told the finance committee, headed by Republican senator, Chuck Grassley, that companies were using the ‘Lilo’, or ‘Lease in, Lease out’ scheme, which took the form of fraudulent leases on subways, bridges, dams and other infrastructures.
Such abuses are believed to be costing the government around £11bn a year, the FT reported.
Grassley blamed accountants, law firms and investment banks for designing financial schemes to help their customer avoid paying tax.
He is fighting to gain greater funds for the Internal Revenue Service for enforcement and to penalise those guilty.