Drunk on corporate welfare – Congress doesn't know when to say when with taxpayer money
on 23/09/10 at 10:38 pmIndustry
We may be witnessing the single worst example of corporate welfare in a generation. With all due respect to the crowd favorite, Archer Daniels Midland, the new contender essentially could give its product away and still make a profit – thanks to the generosity of the American taxpayer.
At the heart of the rip-off is a policy known as the “cover over” tax subsidy, which provides Puerto Rico and the U.S. Virgin Islands (USVI) a rebate on the federal excise taxes U.S. consumers pay when they buy rum produced in those territories. There are virtually no restrictions on the use of the money – though Puerto Rico currently uses 94 percent of the revenues to support investments in infrastructure, health, education and environmental preservation. (The additional 6 percent is spent on marketing for the island’s rum industry.)