Top Iraq contractor KBR skirts US taxes offshore

[babylonsister]

Top Iraq contractor skirts US taxes offshore
Shell companies in Cayman Islands allow KBR to avoid Medicare, Social Security deductions
By Farah Stockman
Globe Staff / March 6, 2008


CAYMAN ISLANDS - Kellogg Brown & Root, the nation's top Iraq war contractor and until last year a subsidiary of Halliburton Corp., has avoided paying hundreds of millions of dollars in federal Medicare and Social Security taxes by hiring workers through shell companies based in this tropical tax haven.

When Texas pipe-fitter Danny Langford applied for unemployment compensation after being let go by Service Employers International Inc., he was rejected, he was told, because he worked for a foreign company.

LEFT IN THE LURCH

More than 21,000 people working for KBR in Iraq - including about 10,500 Americans - are listed as employees of two companies that exist in a computer file on the fourth floor of a building on a palm-studded boulevard here in the Caribbean. Neither company has an office or phone number in the Cayman Islands.

The Defense Department has known since at least 2004 that KBR was avoiding taxes by declaring its American workers as employees of Cayman Islands shell companies, and officials said the move allowed KBR to perform the work more cheaply, saving Defense dollars.

But the use of the loophole results in a significantly greater loss of revenue to the government as a whole, particularly to the Social Security and Medicare trust funds. And the creation of shell companies in places such as the Cayman Islands to avoid taxes has long been attacked by members of Congress.

more...

http://www.boston.com/news/world/middleeast/articles/2008/03/06/top_iraq_contractor_skirts_us_taxes_offshore/

[elizfeelinggreat]

1. ..

The Defense Department has known since at least 2004 that KBR was avoiding taxes by declaring its American workers as employees of Cayman Islands shell companies, and officials said the move allowed KBR to perform the work more cheaply, saving Defense dollars.

Heck, the Defense Department Is KBR nowadays, isn't it?

Thanks for posting this, hopefully this story will gain traction in an election year!

[antigop]

2. And the Dem response to this will be.....

oh, wait. Silly me. I thought the Dem majority might actually work for us.

[Serial Mom]

3. Read the whole article... WAR PROFITEERS

All the execs (including cheney) should be charged and tried!

"KBR declined to release salary information. But workers interviewed by the Globe who served in a range of jobs said they earned between $48,000 and $85,000 per year. If KBR's American workers averaged even as much as $63,000 per year, they and KBR would have owed more than $100 million per year in Social Security and Medicare taxes, split evenly between them. Over the course of the five-year war, their tax bill would have been more than $500 million."

Even though this amount wouldn't have covered any costs of the war, it is still theft - the 'Merikans are being raped! Control, power and money rule in this mis-administration.

[Richard Steele]

4. Grrrecommended.

[Winterblues]

5. that KBR was avoiding taxes

The word should be Evading not avoiding. They should be cut off from any and All Government Contracts whether they are No-Bid or normal Contracts..