DC Fiscal Policy Institute: Tell It Like It Is: Combined Reporting Improves DC’s Tax System By Making Corporations Disclose Their Profits and Pay Their Fair Share
ITEP Work in ActionMayor Fenty and the DC Council recently approved an important reform to the District’s corporate income tax which will prevent large corporations from avoiding taxes. The law, known as “combined reporting,” is recognized by economists and tax experts as the most comprehensive way for states to stop corporations from abusing tax shelters. A majority of states with corporate income taxes already practice combined reporting; many have had this provision in place for more than 20 years. DC’s Chief Financial Officer has concluded the law, which will go into effect in January 2011, will raise roughly $20 million in revenue annually.