Corporations use complicated schemes to shift earnings to subsidiaries in offshore tax havens —countries with minimal or no taxes—in order to reduce their tax liability by billions of dollars. The result is that large multinationals have an unfair advantage, avoiding taxes that small local competitors must pay.

• Worldwide combined reporting requires a corporation to report their total global profits and the portion of their overall business activity in a given jurisdiction. So if a state makes up 2 percent of a company’s global business, then 2 percent of their taxable profit would be subject to state tax.

• If Hawaiʻi adopted worldwide combined reporting, it would collect an additional $38 million per year from large multinational corporations, according to a 2019 report.

• Worldwide combined reporting is considered the gold standard for closing tax loopholes, and the report found it would raise nearly 3 times more revenue than other options to address revenue currently lost to tax avoidance.