Senate Blocks Wyden, King Resolution Closing Tax Loopholes for Large Corporations

Senate Blocks Wyden, King Resolution Closing Tax Loopholes for Large Corporations

Washington, D.C. - Today the U.S. Senate blocked a resolution from Senators Ron Wyden (D-OR) and Angus King (I-ME) to close loopholes in the tax code for large corporations and private equity companies. The Senators' Congressional Review Act (CRA) resolution would have reversed a recent regulatory change that has resulted in a $10.3 billion tax break primarily benefiting some of America's most profitable companies. The CRA comes on the heels of numerous calculated decisions by the Administration to erode the implementation of the Corporate Alternative Minimum Tax (CAMT), a tax law passed by Congress in 2022 that requires companies reporting over $1 billion in profits to their shareholders to pay their fair share in taxes. Under the CAMT, these companies must pay at least 15 percent of those profits in taxes, applying to approximately 150 of America's wealthiest corporations.

From 2018 to 2020, 39 Fortune 500 companies generating $122 billion in profit paid $0 in federal income tax. One of the most profitable companies in the United States secured a 4.3 percent effective tax rate on its $43.4 billion income during the same period, less than one-third of the rate paid by the average American taxpayer. The CAMT, which was included as a provision in the Inflation Reduction Act (IRA), imposed a 15 percent minimum tax based on financial income reported to investors and creditors for corporations earning over $1 billion beginning in tax year 2023. However, following recent Trump administration actions, Treasury and the IRS have started to loosen certain requirements to help fewer corporations become subject to taxes.

"The ink is barely dry on the megabill Trump and Republicans passed to give $1 trillion in new tax breaks to giant corporations, and now his Treasury Department is throwing another $10 billion handout to the most profitable corporations in America," said Senator Wyden. "The pattern we're seeing is that the Trump administration gives big corporations and ultra-wealthy donors whatever tax benefits they want the second they walk through the door at the Treasury Department, but that doesn't mean the Senate has to allow this giveaway to happen. Stuffing $10 billion into the coffers of corporations that are already raking in enormous profits is indefensible at a time when so many Americans are getting battered by inflation and barely staying afloat."

"It's downright unfair to give billions in tax relief to America's most successful corporations when Maine people are struggling to afford their prescription drugs, childcare, and groceries," said Senator King. "This Congressional Review Act (CRA) resolution would block the administration's harmful tax policy that provides a loophole for corporations looking to skirt paying their taxes. This is a commonsense step toward a fairer tax policy that prioritizes people over profits and levels the playing field."

According to the Joint Committee on Taxation, this loophole, hidden inside a new set of regulations, IRS Notice 2025-28, will cost taxpayers over $10 billion. The notice makes changes to the rules governing how large and wealthy corporate and private equity firms can count income from partnerships they own, essentially giving those corporations a "choose-your-own-tax-rate" advantage. Under the new system, a multi-billion-dollar corporation or private equity firm can now choose one of six different ways to count how much money it made in a partnership. These companies can make a different choice for each of the dozens or hundreds of partnerships they own to maximize their tax break. This notice adds complexity to the tax code and encourages the abuse of partnerships that exist solely for tax-dodging gamesmanship, not for any constructive business purpose.

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