Warner, Kaine Introduce Amendment to Reverse Military Retiree COLA Reduction, Close Offshore Tax Loophole
Feb 11 2014
WASHINGTON, D.C. – U.S. Senators Mark R. Warner (D-VA) and Tim Kaine (D-VA) today introduced an amendment to the Military Retirement Pay Restoration Act that would find alternative savings through closure of an offshore tax loophole to replace the cost of living adjustment (COLA) reduction for military retirees. The amendment mirrors legislation introduced by the Senators in December 2013 that would replace the pension reductions with new legislation that could raise as much as $6.6 billion over 10 years by preventing companies from avoiding paying U.S. taxes.
On Monday, the Military Retirement Pay Restoration Act passed a key Senate procedural hurdle. The Senate is likely to vote on final passage later this week.
“Our service men and women deserve better than seeing their pensions arbitrarily cut, and I am pleased we will fix this well before the cut is set to take effect,” said Warner. “I am proud to support legislation to repeal this cut today, and I will use every tool I can to fight pension cuts that unfairly single out Virginia military families.”
“We owe it to military families in Virginia and across the country to repeal the military pension reductions,” said Kaine. “I’m so pleased we’re on a path to make this right and give our veterans and servicemembers the peace of mind they deserve. This commonsense amendment would find alternative savings by closing an offshore tax loophole."
Currently, companies that are incorporated offshore but managed and controlled from the United States can claim foreign status which helps them avoid paying U.S. taxes. This amendment would eliminate the tax loophole that allows those corporations to avoid paying their fair share of taxes.