Most U.S. companies are ignoring President Reagan's order to pay taxes owed Panama into a Treasury Department escrow account established to pressure strongman Manuel Noriega to resign, U.S. officials say.
Reagan last April ordered U.S. companies with offices in Panama to withhold taxes they owe its government and instead pay them into the U.S. escrow account. The idea was that the money would be turned over to Panama once Noriega has resigned or been forced from office.Six months later, that Treasury Department account remains nearly empty as U.S. companies routinely ignore the order to pay into it, according to a member of the House Foreign Affairs Committee.
Rep. Sam Gejdenson, D-Conn., said senior State Department officials told him they estimate that the escrow account is $65 million short of what it should be at this point.
Gejdenson gave no figures on how much money is in the account. But other congressional sources, who spoke on the condition of anonymity, said it contained only $3.9 million, a figure that one administration official described as "in the ballpark."
Some U.S. businesses have told the administration they did not want to pay into the account out of fears there were insufficient accounting controls to keep track of how much each company paid, said Peter Secor, a Panamanian specialist at the State Department.
Secor said the Treasury Department, not the State Department, keeps records on who pays and how much. Gejdenson said Treasury Department officials have refused his repeated requests for that information.
Reagan's order was in two parts: the first that U.S. companies do not pay the Noriega government and, second, that the money be placed in the Treasury Department fund.
"Regardless of the second part, most if not all are complying with the first," Secord said, adding that the administration had put the most priority on keeping the money out of the Noriega regime's hands.
That explanation has been greeted with skepticism on Capitol Hill, partly because the Panamanian government is allowing U.S. companies to continue operating there.
"I wouldn't be surprised if (the companies) continue to pay" taxes to Panama, said Kathleen M. Bertelsen, a Gejdenson foreign policy adviser. "I just doubt Noriega lets them stay there without paying."
But Secor said Noriega simply cannot afford, politically or economically, to throw American corporations out.