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article imageMark Cuban wants us to sell shares of tax-dodging U.S. companies

By Ryan Hite     Jul 27, 2014 in Business
Billionaire investor and Mavericks owner Mark Cuban is echoing words from the U.S. president about companies moving overseas for tax cuts and is advocating selling shares to those companies.
Mark Cuban, the billionaire investor seen on Shark Tank and owner of the Dallas Mavericks basketball team, took to Twitter Friday against companies that adopt overseas addresses to avoid paying U.S. taxes. He urged that investors should sell shares of those companies.
Cuban, who expanded on his words in a recent CNBC interview, echoed comments by Barack Obama, who said the practice, while legal, is ethically wrong. By avoiding taxes, Cuban said that companies create an unfair burden by requiring the government to collect more money from everyone else.
"At some point the owners of the company, the shareholders have to act like owners and take some responsibility,'' Cuban said on twitter.
Obama is stepping up pressure on Congress to close loopholes that allow companies to lower their tax rates. After years of seeking to end or reduce subsidies for energy companies, Obama is now criticizing U.S. companies for acquiring small Irish firms for Ireland's lower taxes.
U.S. taxes companies at 35% compared with 12.5% for Ireland. U.K. and Switzerland companies are also buying Irish companies just for the lower tax rate, The Independent newspaper in Dublin reported.
"I don't care if it's legal, it's wrong,” Obama said in an interview on Thursday, before making an address at Los Angeles Trade-Technical College. β€œIt sticks you for the tab to make up for what they're stashing offshore."
"If you simply acquire a company in Ireland or some other country to take advantage of the low tax rate, you start saying we are now magically an Irish company despite the fact that you may only have a hundred employees there and you've got 10,000 in the United States; you are just gaming the system," Obama said to CNBC. "You are an American company, you continue to benefit in all kinds of ways from being an American company.”
Cuban said he doesn't believe Congress will be able to close any loopholes. That's why he said he will be advocating for a market response.
"That's a difficult battle," Cuban said. "Given the current situation, it's nearly impossible."
If nothing changes and the tax exodus decreases the amount of revenue the government will be able to collect, Cuban said that he believes the extra burden and higher costs will be shouldered by small businesses, start-ups, and even individuals.
"The costs don't leave the system," Cuban stated. "There are X tens of millions of taxes that were paid last year that won't be paid next year and somebody has to pay that."
Although his effort appears to be independent of Obama's, Cuban has been a big supporter in the past.
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