The Top 5 Texas Companies Using Offshore Tax Havens–And Where They're Hiding Their Money

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Last week, the TexPIRG Education Fund and the watchdog group Citizens for Tax Justice released a new report examining in detail how Fortune 500 companies in the United States are using offshore havens to avoid paying the taxes they owe the federal government.

According to the report, an astounding 72% of American Fortune 500 companies operate subsidiaries in offshore tax havens. Offshore tax havens are defined as “countries with minimal or no taxes.” Because they put their profits into shell companies in tax havens, “multinational corporations are able to avoid an estimated $90 billion in fed- eral income taxes each year.”

Many of the companies who make up the worst offenders on the list are expected. Apple has $111.3 billion offshore, making it the company with the most money offshore. Other offenders include Nike, American Express, and Pfizer, whose tax rates on their billions of dollars are often less than 5% due to storing them in fake offshore shell companies.

Several Texas companies are also named in the report, including one that's in the top 10. These companies base their primary businesses in Texas, but keep billions of dollars of profits in offshore shell companies to avoid paying the necessary taxes.

See which Texas companies are hiding the most money in offshore tax havens after the jump. According to the list of Fortune 500 companies using offshore tax havens listed in the TexPIRG/Citizens for Tax Justice report, the following are the top 5 companies based in Texas using tax havens, ranked by the amount of money they are hiding.

Company Amount Hidden Offshore Number of Tax Haven Subsidiaries Location of Tax Havens
Exxon Mobil $47 Billion 38 Bahamas (19), Bermuda (1), Cayman Islands (1), Hong Kong (3), Luxembourg (5), Netherlands (7), Singapore (2)
Dell $19 Billion 79 Bahrain (1), Barbado s(1), Bermuda (2), British Virgin Islands (2), Cayman Islands (4), Channel Islands (1), Costa Rica (2), Hong Kong (6), Ireland (9), Jordan(1), Lebanon (1), Luxembourg (3), Mauritius (2), Netherlands (27), Panama (1), Singapore (11), Switzerland (5)
Apache $17 Billion 61 Cayman Islands (46), Luxembourg (10), Netherlands (1), Singapore (2), St. Lucia (1), Switzerland (1)
Kimberly-Clark $9.8 Billion 44 Bahrain (1), Barbados (1), Bermuda (2), British Virgin Islands (1), Cayman Islands (7), Channel Islands (2), Costa Rica (1), Cyprus (1), Hong Kong (2), Luxembourg (4), Malta (1), Netherlands (10), Panama (2), Singapore (8), Switzerland (1)
Texas Instruments $6.87 Billion 17 British Virgin Islands (1), Hong Kong (7), Ireland (2), Luxembourg (2), Netherlands (2), Singapore (3)

Exxon Mobil tops the list with $47 billion hidden in 38 offshore companies around the world. In fact, Exxon Mobil makes it into the national top 10 list of Fortune 500 companies with the most money hidden offshore (coming in at number 9). The other companies making up the top 5 are Dell, Apache, Kimberly-Clark, and Texas Instruments.

These companies are hiding their money offshore using shell companies based in different countries. Some have more shell subsidiaries than others (see: Dell), but they all do the same thing. These companies have few employees and do little business, and are registered in countries with very low tax rates. By funneling profits to these shell subsidiaries, corporations are able to avoid paying US federal taxes. Those who have fewer listed offshore subsidiary companies may not actually be dodging fewer taxes–many companies simply do not disclose all of the tax haven subsidiaries they have, so taxes dodged may be even higher than listed.

Other Texas-based Fortune 500 companies that made appearances on the list of worst tax haven offenders include Halliburton, National Oilwell Varco, Baker Hughes, Cameron International, Valero, and ConocoPhillips. The last two–Valero and ConocoPhillips–are major donors to Greg Abbott and other Texas Republicans.

TexPIRG and Citizens for Tax Justice suggest several measures to stop the corporate abuse of offshore tax havens in their report. The most comprehensive solution they suggest is ending incentives to move jobs and profits offshore by no longer permitting “U.S. multinational corporations to indefinitely defer paying U.S. taxes on the profits they attribute to their foreign subsidiaries.” They also suggest closing the many tax loopholes that let corporations get away with moving their money offshore, and increasing transparency by requiring companies to make full disclosures of their profits on a country-by-country basis.

When corporations use offshore tax havens, they deprive the government of the tax dollars it needs to provide citizens with vital programs and services. Moreover, it leaves regular citizens to foot the bill. This egregious practice is promoting inequality and harming the future of the country. The TexPIRG/Citizens for Tax Justice Report is an important step to expose the extent of systemic tax haven abuse, and it's important to continue holding large corporations accountable.


About Author

Katie Singh

Katie grew up in Austin and has been involved in Texas politics since 2004. She has been a part of several campaigns, from state house races to working at President Obama's campaign headquarters in 2012. She loves public policy, public health, and tacos. Katie tweets from @kasingh19.

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