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Security Contractor Blackwater Being Investigated For Tax Evasion? March 16, 2008

Posted by Aaron Walter in Uncategorized.
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For more, see the March 12 post from the “Ataxingmatter’ Blog

House chairman asks agencies to probe Blackwater

In letters sent to the Internal Revenue Service, Small Business Administration, and Labor Department on Monday, Rep. Henry A. Waxman, D-Calif., chairman of the House Committee on Oversight and Government Reform, requested investigations into whether Blackwater Worldwide, the private security contractor involved in the shooting of 17 Iraqi civilians last year, is complying with federal tax, small business and labor laws.The committee says that Blackwater might have failed to withhold $50 million in taxes from workers’ paychecks while receiving $1.25 billion in federal contracts since 2000.”I request that the Internal Revenue Service initiate an inquiry into whether Blackwater has complied with federal tax laws and take any appropriate action,” Waxman wrote in his letter to the IRS.In March 2007, the IRS concluded that Blackwater had improperly designated security guards working in Iraq as independent contractors and not company employees to sidestep its obligation to withhold taxes on wages, Waxman said in a public statement accompanying the letters.”As a result, Blackwater obtained small business contracts without competing with other qualified bidders that properly designated their guards as employees,” said Waxman. His committee reported that Blackwater has won at least 100 small business contracts totaling more than $144 million since 2000.Waxman also said that Blackwater refused to cooperate with a Labor Department audit to determine whether the security company violated equal employment opportunity laws.
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Iraq Contractor KBR Has Dodged $500 Million in U.S. taxes March 10, 2008

Posted by Aaron Walter in Uncategorized.
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Kellogg Brown & Root (KBR) sure is a piece of work.  Lets recap a week or so of posts concerning KBR.

 1. KBR has been passing along to the American taxpayer, AIG’s inflated premiums for Defense Base Act coverage, so that KBR (and other contractors in Iraq and Afghanistan) could be insulated from liability for injuries to its employees.

2. KBR is presently being sued in Federal Court for allegedly intentionally causing the deaths of six KBR truck drivers in 2004.

3. Now we discover that the 10,000+ Americans working for KBR, were really working for a Caribean company, not an American one, saving KBR as much as $100 million a year in U.S. Medicare and Social Security Taxes. By claiming its own employees, many of which were hired in Texas and shipped directly to Iraq from there, to be employees of the Cayman Islands corporation Service Employers International Inc, KBR also avoids having to pay for unemployment insurance. That means KBR employees coming home from Iraq are ineligible to recieve unemployment. I bet that wasn’t part of the orientation movie. I also bet it wasn’t part of the pitch to the Department of Defense before they were granted a no-bid contract for work in Iraq.

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