Tuesday, November 25, 2008
Congressman Rangel continues to fight off charges that he used his influential position as Chairman of the powerful House Ways and Means Committee to garner large donations for his namesake charity in exchange for preventing legislation to benefit his largest donors (a notorious corporate inverter). I wonder if this New York Times article raises a question as to whether the described contributions were made for a quid pro quo and therefore should not be tax deductible. Here is an brief excerpt from a rather long expose:
Congressional records and interviews show that Mr. Rangel was instrumental in preserving a lucrative tax loophole that benefited an oil-drilling company last year, while at the same time its chief executive was pledging $1 million to the project, the Charles B. Rangel School of Public Service at C.C.N.Y. The company, Nabors Industries, was one of four corporations based in the United States that were widely criticized in 2002 and 2003 for opening offices in the Caribbean to reduce their federal tax payments. Mr. Rangel was among dozens of representatives from both parties who bitterly opposed those offshore moves and, in 2004, pushed unsuccessfully for legislation to make the companies pay more tax. But in 2007, when the United States Senate tried to crack down on the companies, Mr. Rangel, who had recently been sworn in as House Ways and Means chairman, fought to protect them. The tax shelter for the four companies was preserved, saving Nabors an estimated tens of millions of dollars annually and depriving the federal treasury of $1.1 billion in revenues over a decade, according to a Congressional analysis by the nonpartisan Joint Committee on Taxation. Mr. Rangel said he stood with Nabors because, as much as he was offended by the company’s attempts to get around some of its United States taxes, he thought it wrong to impose a retroactive tax increase. The congressman said he has long believed that retroactive punishments are bad public policy.
Things that make you go hmmmmmmmm!