Demonstrators Call Attention to 'Delaware Tax Loophole' with Protest at Cranberry Toys 'R' Us

As shoppers entered and exited the in Cranberry on Friday, protesters handed them pink fliers detailing the so-called “Delaware Tax Loophole.”

The group of about , which allows corporations to shift profits to holding companies based in Delaware, where the tax structure is more favorable to businesses than that of Pennsylvania's.

The flier referred to Toys “R” Us as one of thousands of companies that are subject to the corporate net income tax but are not paying their fair share of tax profits. Group spokesman Dominic Gronito, a health care worker from Beaver County, added demonstrators were protesting the practices of all big corporations, including Toys “R” Us, that they believe aren’t paying enough taxes in difficult economic times.

Gronito, whose daughter attends school in the , said Cranberry was chosen for the protest because of its 5.6 mill increase in real estate taxes, increased activity fees and programs cutbacks.  the district faces next year, in part because of a cutback in state funding.

If corporations were paying their fair share of taxes, that money could be used to repair bridges and roads, fund schools and provide health care to residents, protesters said.

The mix of Pittsburgh-area health care workers, teachers and Service Employees International Union members also urged people to contact their state representative about the loophole.

“We just think the legislators or political leaders in this area should probably take a look at this and maybe make the corporations pay their fair share of taxes and alleviate some of the pressures on the working class and school district members of this area,” Gronito said.

A district manager at the Cranberry store declined comment. When contacted earlier Friday, Toys “R” Us spokeswoman Kathleen Waugh called the company's involvement in the loophole “ancient history.”

"In the 1980s, the company had a corporate structure that took advantage of this tax benefit for its intellectual property rights," she said. "As a result of court rulings and law changes in many states, the company changed its corporate structure.

"In fact, the company pays a significant amount of corporate income taxes and real estate property taxes in the state of Pennsylvania."