WASHINGTON–The Government Accountability Office has cited a number of insurance companies, including American International Group, as having subsidiaries in areas classified as tax-havens.

The list mentions property-casualty insurers, life insurers and health insurers including Berkshire Hathaway, the Hartford, MetLife, Travelers and United Health.

The report was requested by Sens. Byron Dorgan, D-N.D., and Carl Levin, D-Mich., as part of their continuing effort to more tightly control the use of offshore tax havens to reduce their U.S. taxes.

The senators have criticized U.S. companies for using offshore tax havens to save an estimated $100 billion in lost U.S. tax revenues each year.

They also said in a statement “that many of these companies are paid with taxpayer dollars and some have also received billions of dollars in taxpayer bailout funds.”

Besides the companies listed above, other insurers cited in the report include Aetna, Allstate and Prudential.

The report says that Prudential has the most of these affiliates, 27, followed by MetLife with 19 and AIG with 18. United Health was reported to have 11, Hartford 10 and Aetna 8. Berkshire Hathaway and Allstate each have only one offshore tax haven subsidiary.

But in the report, the GAO noted a criticism by the IRS about listing tax havens or financial privacy jurisdictions “because there is no agreed-upon definition of tax havens or list of jurisdictions.”

GAO officials said there is no agreed-upon definition or list but noted that the jurisdictions on the three lists used have similar characteristics. Further, background for one list said that “industry analysts recognize them as offshore tax haven or financial privacy jurisdictions and that they are promoted as such.”

The report said 83 of the 100 largest publicly traded U.S. corporations in terms of 2007 revenue reported having subsidiaries in jurisdictions listed as tax havens or financial privacy jurisdictions.

Sixty-three of the 100 largest publicly traded U.S. federal contractors in terms of fiscal-year 2007 federal contract obligations reported having subsidiaries in such jurisdictions.

“This report shows that some of our country's largest companies and federal contractors, many of which are household names, continue to use offshore tax havens to avoid paying their fair share of taxes to the U.S.,” said Sens. Dorgan and Levin.

And, some of those companies have even received emergency economic funds from the government, said Sen. Dorgan. “I think we should take action to shut down these tax dodgers and we will be introducing legislation to do just that,” he added.

Special Reports /

GAO Finds AIG Amid Insurers With Tax Haven Units

Related Stories

Recommended For You