Outrage At Microsoft Offshoring Tax In the UK, Google Caught Avoiding US Taxes 768
Master Of Ninja writes "After the ongoing row about companies not paying a fair share of tax in the United Kingdom, and with companies such as Starbucks, Amazon and Google being in the headlines, focus has now turned to Microsoft. Whilst the tax arrangements are strictly legal, there has been outrage on how companies are avoiding paying their fair share of tax generated in the country."
And over here in the U.S., dstates sent in news of Google getting caught doing something similar: "Bloomberg reports that Google is using Bermuda shell companies to avoid paying billions of dollars in taxes worldwide. By routing payments and recording profits in zero-tax havens, multinational companies have been avoiding double digit corporate taxes in the U.S. and Europe. Congressional hearings were held in July on the destructive consequences of off-shoring profits. Why aren't the U.S. and Europe exerting more diplomatic pressure on these tax havens that are effectively stealing from the U.S. and European treasuries by allowing profits that did not result from activities in Bermuda or the Cayman Islands to be recorded as occurring there?"
What's good for the goose... (Score:5, Insightful)
"Why aren't the US and Europe exerting more diplomatic pressure on these tax havens...?"
Because where else would US politicians offshore their income? http://www.vanityfair.com/politics/2012/08/investigating-mitt-romney-offshore-accounts [vanityfair.com]
Re:What's good for the goose... (Score:5, Insightful)
Re:What's good for the goose... (Score:5, Insightful)
Don't worry, they'll pass a pay raise for themselves to offset the extra burden. Just like with Obamacare & Medicare/Medicaid. Those are good enough for the common folk, but they've the Rolls Royce of medical plans for themselves. The kind of plans some of receive from our employers that they now want to tax as income (at upwards of $5000/year in some cases).
This isn't Democrats or Republicans. It's Democrats AND Republicans. The entire lot of them are a bunch of selfish, hypocritical, thieves.
Re:What's good for the goose... (Score:5, Insightful)
Re:What's good for the goose... (Score:5, Funny)
A good percentage don't vote Democratic or Republican. Problem is they don't make it to the poles either.
That would be because the North and the South Pole are a long way away, and very very cold.
Spelling, people, spelling. Now get off my lawn!
Re:What's good for the goose... (Score:4, Interesting)
The kind of plans some of receive from our employers that they now want to tax as income (at upwards of $5000/year in some cases).
Lots of countries consider private medical insurance to be a taxable benefit. It is a form of remuneration, after all.
Re:What's good for the goose... (Score:5, Informative)
Perhaps you missed Obama filling his cabinet originally. He had to go through 50 people to get 20 from the DNC that had ACTUALLY paid taxes. Daschle failed to pay taxes, a woman named Hillary (not Clinton) was rejected for failure to pay taxes, Tim Geitner was still confirmed even though he didn't pay taxes. Go into Congress and you can find more, like Charles Rangle who didn't pay taxes. There was even a stink about John Kerry mooring his boat in Rhode Island to avoid state taxes from Mass.
Your point is invalid because its the DNC that raises taxes and its the DNC politicians that constantly fail to pay taxes.
Re:What's good for the goose... (Score:5, Insightful)
Your point is invalid because its the DNC that raises taxes and its the DNC politicians that constantly fail to pay taxes.
No, his point is not invalid, and no it's not the DNC which raises taxes. CONGRESS raises taxes, you need to get this through your thick skull. It's ALL of them, don't buy into the rhetoric and political bullshit they spew out from one side or the other.
This circles back to the article itself. Did Google break any laws? Did Microsoft? In both cases it appears to be no, they did not. So quit pissing and moaning about "Big Corporations" and/or the Rich evading taxes. Quit giving a pass to the people we elected to run the country. They need to fix the laws so that these types of filthy loopholes simply don't exist.
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It's cute that you actually buy that. David Cameron has a net worth of $50 million [celebritynetworth.com]. Even if supposing he's financially illiterate and shoves it in a savings account it would still net him $1.5 million each year. But let's all just ignore the facts and pretend he's an underpaid middle-class average Joe like you and me.
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They do have some other "incentives" as well. Campaigns aren't free and friends in high places can be invaluable..
Re:What's good for the goose... (Score:5, Insightful)
Actually, the US has no business exerting any pressure on other sovereign nations regarding what they do in their legal system, with perhaps exceptions for human trafficking, human rights abuses, and other such things.
The US should simply make it illegal for these US companies to do this. If they flaunt the law, then they should be punished for it. No need to fuck with other countries laws.
Re:What's good for the goose... (Score:5, Informative)
The US should simply make it illegal for these US companies to do this.
The problem is these aren't technically US companies. That's how a shell company works.
It's not that I don't disagree with you. It would be great if the US could put a stop to this behavior. But on paper, these companies are fully foreign companies that happen to have a relationship with a US company. That relationship consists of holding a lot of money overseas.
Re:What's good for the goose... (Score:5, Interesting)
It is easy to figure out how to hurt "shell" companies. All you have to do is tax transfers of wealth between corporations. Period. Taxing income is stupid, because all you have to do is hide the income long enough to get it to an offshore holding company in some island in the pacific. BUT if you put a 1% (or whatever) tax on money going out of the country, corporation to corporation, and you have all the revenue you need. Put a tax incentive of .75% tax break on any US corporation bringing money from offshore, and you'll spur the economy.
Tax the things you don't want, incentivize the things you do want and you can fix the world. Problem is, most politicians do the exact opposite, by taxing productivity and rewarding failure. The fix is simple, but we are unwilling to mess with status quo too much.
Re:What's good for the goose... (Score:5, Interesting)
Re:What's good for the goose... (Score:5, Interesting)
I didn't say transfers of money, I said transfers of money out of the country, corporation to corporation. Corporations that transfer money, inside the country are not taxed. Are you being productive, then you won't mind 1%, if you're not, you will. Like I said, you incentivize the opposite, so that people get a bonus for bringing money into the country. It is really that simple, it would cause a shift in how business is done.
In your case, Starbucks paying "licensing" fees to Starbucks Holding Company would be taxed straight up 1% (my example, not a real number) on the totality, not the "profits". While Starbucks paying NEC USA (registers) would pay nothing in taxes for that transfer. NEC USA would pay the tax when transferring money to parent company in Japan (or wherever)
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Re:What's good for the goose... (Score:5, Insightful)
The US government should simply announce that they are prioritizing their overseas support of US business based on perecent of revenue booked in the US.
When Microsoft or Apple get pissed about piracy or knockoffs overseas, the US should simply tell them that they can ask Bermudan or Cayman Islands officials to take care of the issue.
Re:What's good for the goose... (Score:5, Informative)
The crux of these loopholes seems to be that by and large, corporate taxes are levied on net profit, not gross revenue. A company will make $10B in the US, then license something from a Bahamanian subsidiary for $10B, resulting in a profit for the US component of $0. If they had to pay on the total revenue, losing money to themselves would only increase exposure (since the US and Bahamanian divisions would both pay tax on the same $10B).
In the example of a US-based construction firm that made some money through a Canadian subsidiary, Canada would get the tax on that part of the work and the US on their domestic revenues.
The problem with this taxation model is that it would be a heavy weight on young companies; businesses generally run losses for the first several years of operation, even without paying taxes.
Obviously this is my layman's view of the way corporate income tax works; I assume that there is a certain complexity to the way that revenue and profit are calculated for tax purposes, and that there are frictional costs associated with various maneuvers.
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Alright - you CANNOT tax gross profit, with the system we have in place. Gross profit is defined as your product's total worth, or value, ie, all the money that you put into the till.
If we switched to a Value Added Tax, like the Euros, then you could come closer to taxing gross profits.
The problem is, we have allowed, and condoned, outrageous "deductions" such as you have mentioned. Corporate accountants know that these deductions are just gimmicks to dodge taxes. Corporate officers know it. The IRS kno
Re:What's good for the goose... (Score:5, Informative)
What the GP described is not a deduction. It is called "transfer pricing" or "cost-effective supply chain management". What they do is they artificially inflate the price of a single stage in the production or sale of the product and accounting for this in subsidiary in a tax haven or a country with a very low tax rate (This is what Google and Microsoft does). Alternatively the actual product itself is owned by a off-shore subsidiary (ie. what Walkers/Lays does with their potato crisps/chips in the UK).
The latter is actually a very good case study in this type of activity. Walkers is the UK snack food subsidiary of PepsiCo/Frito-Lays. They produce much of their products in the UK but the product (ie crisps/chips) are owned by a Swiss subsidiary. The UK factory makes no profits and the profits that come from the sale of the crisps in the UK go directly to the Swiss subsidiary (with much lower corporation tax). It's a complicated structure but it enables them to avoid most of the tax on profits in the UK. This is enabled by the EEC rules the preluded the eventual formation of the EU (which Switzerland is not a part of officially).
What you describe as a tax on gross profits is actually called a "cascade tax" or more commonly known as sales tax. VAT is not a cascade tax and is a tax on the value add of each stage of production. It's not the most straightforward topic so you might want to read up on it if you are passionate about tax reform.
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I forgot to mention that many jurisdictions put a limit on sales tax so that it is only levied on the final user. This takes away the cascading element of tax and makes it less problematic. However, not all jurisdictions did this. British Columbia, for example, before moving to the HST had provincial sales tax (PST) that that was levied on (nearly) all transactions, whether it is final use or not. This made it a cascade tax as the tax is put on the full value of each transaction. What this led to was vertic
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Interesting idea. However wouldn't that pretty much guarrantee that businesses with small profit margins (i.e. any sort of manufacturing) would go out of business?
This was required by law. Really. (Score:5, Insightful)
Because where else would US politicians offshore their income? http://www.vanityfair.com/politics/2012/08/investigating-mitt-romney-offshore-accounts [vanityfair.com]
I'm NO friend of Mitt Romney - to put it mildly. But let's not blame him for something that's not his doing.
1) Because Romney was running for president, US law REQUIRES he put his money in a blind trust.
2) Also under US law the trustee has a "fiduciary duty" to do his reasonable best to protect and grow Romney's money for him. That includes seeing to it that is not taxed substantially more than the law requires. If he can save, say, 40% of the trust's earnings from being taxed away by using a LEGAL tax haven in Bermuda, and trustees of such trusts are expected to know that, he is REQUIRED BY LAW to do so.
So let's not have cheap shots against politicians and financial managers who are only doing what the law REQUIRES them to do.
There are plenty of things politicians have done that we can LEGITIMATELY go after them about - which have zapped us to the tune of trillions of dollars - at $3,175.40 from EACH citizen for EACH trillion. Let's not the dilute the discussion, and give them something to use to discredit their critics, by flaming them over drops in the bucket that AREN'T THEIR FAULT.
Re:This was required by law. Really. (Score:5, Insightful)
All of this crap is legal, that's why they call it tax 'avoidance'. It's not right, or fair, but it is legal.
Re:This was required by law. Really. (Score:5, Insightful)
Re:This was required by law. Really. (Score:4, Interesting)
The top 1% of tax payers earn what - 75% of total earnings in the US? They should be paying 75% of all income taxes. No, 20% is not plenty - even if that figure is accurate. The more you make, the more you pay.
Heh - I went googling for the actual percentage of total income taxes paid by the top 1%. I found a site with a wilder spin that I've read before - it claims they pay 38%, or almost double what you've stated. Which, only goes to prove that someone with an agenda can make any claim they like, and back it up somehow.
Bottom line - everyone pays xx% of their income, no matter how poor, or how rich, no matter how many influential people they bribe or sleep with. Set it at about 27 or 28%, and I'll see no change. Set it somewhere, anywhere - then ENFORCE IT FOR EVERYONE!
Re:This was required by law. Really. (Score:5, Insightful)
Bottom line - everyone pays xx% of their income, no matter how poor, or how rich, no matter how many influential people they bribe or sleep with. Set it at about 27 or 28%, and I'll see no change. Set it somewhere, anywhere - then ENFORCE IT FOR EVERYONE!
Trouble is if you setup xx% high enough to be useful, you smash the lower end of the middle class and everyone earning less.
Flat income taxes are regressive. Losing 25% of your income is not a burden for someone pulling in a million a year, but it's crippling for someone pulling in $30k/yr.
Nope, sorry, that's simply wrong. (Score:5, Insightful)
We don't have a revenue problem in the US - we have a spending problem.
You've bought the conservative lies hook, line, and sinker.
The fact is, while this country is spending too much on its military (more than the next 13 military-spending countries combined), its main problem is, indeed, a revenue problem. The tax rates and the tax revenues as percent of GDP are lower than they have been at any time since the Great Depression.
So unless you are one of those who honestly believes that we'd be better off with, essentially, no federal government at all (in which case I disagree with you, but at least respect you for having beliefs consistent with your policy preferences), we need taxes to be a lot higher than they are if we want to continue to function as a first-world country.
Dan Aris
Re:This was required by law. Really. (Score:5, Insightful)
At any rate, the top 1% of taxpayers don't draw on 20% of the budget.
No, they don't. They draw on almost 100%. Who's running your telcoms and radio and TV stations? The 1%. We need the FCC to keep them in line. Who owns those big trucks that haul everything and cause most of the road damage? The 1%. Who leases public lands for oil exploration? The 1%. Who need the coast guard? The 1% almost exclusively. Who does the military protect? The 1%.
Who need the FBI? Not the bottom 1%! In fact, the FBI and DEA and BATF only benefit the 1% and the bottom 1% fear them.
The bottom 1% (probably the bottom 10%) use almost no government at all. They don't have any use whatever for the police, because if a poor man calls the cops he's usually the one to go to jail (and your local government gets federal grant money for cops and cop equipment). Social programs for the poor are very niggardly in the US compared to civilized nations.
When my grandfather was a young man, only the rich paid federal income taxes. How about we go back to doing it that way? Government benefits primarily the rich, the rich should be paying the lion's share of it (if not all, like in Grandpa's day).
We don't have a revenue problem in the US - we have a spending problem.
We have both a spending and revenue problem. I'd legalize, tax, and regulate drugs, disband the ATF and the DEA and the TSA and most of Homeland Security, but I'd keep FEMA (who benefits the most in a catastrophe, the guy with the ruined ten million dollar house filled with expensive items, or a renter whose most expensive posession is probably a used car? I'd cut the military in half or smaller. I'd cut most grants, and all grants to corporations. What would you cut?
But we can't cut our way out. As another poster already mentioned, federal taxes are lower than at any time since Truman. The rich are just being the greedy, selfish bastards one has to be in order to become or stay rich.
Correction: Only the second part is required. (Score:5, Informative)
Did a little checking: Actually a presidential candidate is not REQUIRED to put their money in a blind trust.
In principle Romney could have kept control and ordered his accountants to not use a tax haven.
The downside is that he'd be nuts to do so. In addition to the loss of money from such deliberate mismanagement, he'd be leaving himself open to legitimate attacks on any OTHER decision he made about the money, along withaccusations of conflict-of-interest when he makes political decisions. (Avoiding both conflicts of interest and the appearance of them is the whole point of blind trusts.)
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Hate to tell you this, but Obama isn't exactly a 99%er either.
Re:What's good for the goose... (Score:5, Informative)
He was until relatively recently, unlike others who were born with silver spoons in their mouths.
I think he remembers his apartment dwelling days quite clearly.
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He doesn't have the educational history of someone with poor parents, or even of someone with just average parents. He spent just 1 year of grade school in a public institution, all other years being private schooled. He spent grades 5-12 in Punahou school, where tuition costs more than minimum wage pays before tax each year.
Re:What's good for the goose... (Score:5, Insightful)
Re:What's good for the goose... (Score:4, Insightful)
Re:What's good for the goose... (Score:5, Insightful)
all other years being private schooled.
Attending a private school does not mean you're wealthy. There are plenty of private schools full of children from low and middle class families.
Oh yeah, from all walks of life. For instance, in Chicago, almost 40% of public school teachers send their kids to private schools [hotair.com]. What it comes down to is they're just trying to get a decent education for their children.
Re:What's good for the goose... (Score:4)
all other years being private schooled.
Attending a private school does not mean you're wealthy. There are plenty of private schools full of children from low and middle class families.
Oh yeah, from all walks of life. For instance, in Chicago, almost 40% of public school teachers send their kids to private schools [hotair.com]. What it comes down to is they're just trying to get a decent education for their children.
Hotair.com aka mouthpiece of the most delusional of fringe republicans.
They're simply quoting the Fordham institute's study, of course. But when you have no facts to fall back on, I guess accusing everyone else of being "delusional" is the best you can do.
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...Hotair.com aka mouthpiece of the most delusional of fringe republicans.
So? If its factually accurate, who the fark cares? If Hitler said "the sky is blue and the grass is green" does it make his statement any less factual?
(Im a Libertarian so dont start pointing fingers too quickly)
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I think he remembers his apartment dwelling days quite clearly.
Is that why he takes so many expensive vacations on the US taxpayer's dollars? (Michelle too)
Seriously, it takes the UK less than $60 million per year to support the entire Royal family, while it takes the USA over $1.4 billion per year to support a family of four in the White House. Whether you like Bush or hate Bush, he (Laura too) didn't take as many expensive vacations and was less expensive to support.
Here's an article about this. While
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From your daily mail article:
Two of the principal costs of the the Obama presidency - and any other presidency - are staffing and security, according to Robert Keith Gray's book Presidential Perks Gone Royal.
When it comes to keeping the First Family safe, few would dispute that it is worth paying a high price to keep the President safe from harm.
This means paying for hundreds of Secret Service agents, travel in the secure space of Air Force and funding a team of doctors to follow Mr Obama around.
But even this essential expense can be exploited to political ends, according to Mr Gray, a former staffer for Dwight Eisenhower, Richard Nixon, Ronald Reagan and George H.W. Bush.
Lets look at part of that again:
But even this essential expense can be exploited to political ends
That IS what you are doing is it not?
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What do you want them to do? Hole up in a bunker for the entire presidential term?
Re:What's good for the goose... (Score:4, Insightful)
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Do you realize that a lot of presidenta do not carry that much security, a few of them in countries with more population, and most of them in countries where poorness is much bigger?
Re:What's good for the goose... (Score:4, Interesting)
* - There was another assassination but I'm not sure if it was early 20th or late 19th century.
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Up until the 70's-80's Australia had similar gun laws to those of the US but not the same "gun culture",
Same in Norway, we have a very different "gun culture", which is why we have fewer homicides using guns than in the US despite of the fact that we have more guns per capita than does the US. As an example, and I am not entirely a-typical, until recently i had, in my house, a shotgun, a rifle, a machine gun (military issued, so that went when I turned 45) and two hand guns. I would guess the average Norwegian house hold has at least a shot gun and/or a rifle.
Even with the nutter on the Island, we have very,
Re:What's good for the goose... (Score:4, Interesting)
Re:What's good for the goose... (Score:4, Informative)
First of all, $250K a year doesn't get you into the 1%. You need a bit more than that. The top 1% earned an average of $717,000 per year. The lower limit for a "1 percenter" is $386,000/year. And indeed, a large number of these people were indeed born with silver spoons. Many of them may have made relatively small sums right out of college...after all, you don't pay a recent college grad extra money for the same job just because their parents are rich. Looking at what they get paid for their first jobs when they graduate, however, completely ignores the concept of the "silver spoon." It doesn't take into account trust funds, gifts, being supported by their parents, inheritance wealth, or any investment portfolio they may already have at that point in their lives. It just looks at what an inexperienced college grad is worth on the market, which has nothing to do with actual wealth.
And the average college grad who has been working his entire life absolutely does not make it into the 1%. It's just common sense. If working your whole life and going to college, on average, gets you into the top 1% of anything, then that means only 2% of the population went to college and worked their whole life. If you want to stretch it a bit..okay, 3%. A lot more than that percentage of the Americans I know (because that's the population we're talking about here) went to college, and kept in the workforce the whole time.
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I'm .. I'm stunned! (Score:3, Interesting)
No, actually I'm not. Not in the least. It's the way of things now, even when your motto is "Do no evil" or "What evil would you like to get into today?" Wall Street expects certain targets to be hit and the way to do that is cut corners and use loopholes.
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Unfair advantages are precisely why cheating is frowned on in the first place.
If it goes unpunished it still remains an advantage even if it's unfair.
That's what happens when you have an unregulated market where the only law that stands is the law of the jungle.
Re:I'm .. I'm stunned! (Score:5, Insightful)
Re:I'm .. I'm stunned! (Score:5, Insightful)
That's a common fallacy [salon.com]. There is no US statute, state or federal, that requires "maximising shareholder value"
Re:I'm .. I'm stunned! (Score:4, Insightful)
No, actually I'm not. Not in the least. It's the way of things now, even when your motto is "Do no evil" or "What evil would you like to get into today?" Wall Street expects certain targets to be hit and the way to do that is cut corners and use loopholes.
Considering how the tax money is spent it's probably more evil paying taxes then avoiding them...
Or... (Score:2)
I know this is crazy, but. . . (Score:5, Insightful)
I know this is crazy, but maybe the problem is the taxes. It doesn't make any sense at all tax corporate profits when you could just as easily tax the income shareholders make from the profits, or capital gains in the event a corporation doesn't post dividends.
Re:I know this is crazy, but. . . (Score:5, Insightful)
Problem is that capital gains are taxed very low compared to wages, so the company has incentives to keep cash on the books to appreciate the stock without reinvestment risk, thus creating wealth for shareholders at low income tax rates. You will never see the money reinvested or increase of wages at the company.
Re:I know this is crazy, but. . . (Score:5, Insightful)
Yet another tax policy that makes no sense at all. There is no reason capital gains and dividends shouldn't be taxed as regular income, they justify it today by saying "corporations pay taxes so taxing these things as income is double taxation." It's all just a stupid shell game. They make up a bunch of bizarre, self-reinforcing justifications for a convoluted tax scheme, then move their money through all they loopholes they've built so that is perfectly legal. It's nonsense.
And the rich walk away laughing. (Score:3)
You do know that sales taxes are ridiculously regressive, right?
If someone who makes $50k/yr spends $25k of that on taxable goods, that's 50% of his income. Do you really think that someone making $500 million/yr spends $250 million on taxable goods? I mean, it would be great if they did—that would be some damn good economic stimulus right there—but in reality, the richer you are, the smaller a percentage of your income you spend on taxable goods. Generally, the rich put large chunks of their in
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Buying up complimentary companies doesn't reduce competition the way buying a competitor does, but it does reduce a company's agility and efficiency as the various internal groups vie politically for power.
What you see in reality is that there is a certain optimal size for a company after which it will start to decline and become unprofitable. A shrewd investor would look at a company like HP and realize that they're not going to be fiscally healthy unless they stop trying to grow and settle into their mark
Applicable quote from Judge Learned Hand (Score:3, Informative)
"Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one's taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands."
Re:Applicable quote from Judge Learned Hand (Score:5, Insightful)
Problem is that the rich make the laws. So they adjust the rules to benefit themselves unfairly.
Hey there poor person, why don't you have your investments setup in IRAs and 401(k)s? You should get into the consulting business and write a few books. Capital gains taxes are rather agreeable. What's that you say, you can't afford food? Well, if you'd taken my advise ...
Change the tax structure (Score:5, Insightful)
The reason these loopholes work is that multinational corporations can allocated their costs to high-tax countries and profits to low-tax countries. For example, a US operation "licenses" some software from a subsidiary in Cayman Islands or pays for "consulting services" that end up eating up all of the profits. Through these tricks a US corporation ends up with near-zero taxable income, while all the profits are transferred to tax havens.
The solution is to tax ALL profits, regardless of which country they were supposedly "earned" in. That way, transferring profits to Bermuda or Luxembourg will have no effect.
Can't steal what they never had (Score:3, Insightful)
That's the argument we use for file "sharing", so let's not turn it on its head for tax. You want to earn it, make the argument for it.
There is no inherent merit to paying taxes. They are a necessary evil to fund useful public works, and should be kept to an absolute minimum. When States becomes bloated, inward looking, ever swelling monsters that squeeze the pips until they squeak, tax avoision becomes an act of moral rebellion.
Brits in particular tithe up to 75% of our "income" to the State, when you factor in income tax, national insurance, council tax, water and sewerage rates, VAT, insurance tax, parking fees, and fuel and customs duty on everything imported or moved around. And that "income" is what employers can afford to pay us after they pay all of their protection money to the biggest racket in town.
So good on Microsoft and Google and Amazon and all the other companies who are throwing two fingers up at the grasping State. Let it wither and die, as long as it rots from the head down.
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I just watched a music video for the Indian Debating Society that was advocating civil, reasoned discourse instead of yelling and throwing things.
And you know what? Shut up you stupid fucking asshole. You're so stupid, you'd have to study hard to learn how to be an idiot. Sit down and be quiet in front of your betters.
There is nothing on this earth that is a more natural monopoly than goddamn ROADS. There is no way, NO way for me to choose between three or more competing vendors for who will service my
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I drive on several privately built and funded roads every year.
I suppose that when you are very wrong, you can make up for it by appearing to be very angry?
make 'em pay taxes (Score:3)
"double digit corporate taxes" (Score:3)
They may be evading sums as large as $99!!!
"Outrage" WTF? (Score:3)
Tax Games (Score:4, Insightful)
This isn't a problem with the companies in question - it's a problem with the game. As soon as a company has a presence in more than one country, the company needs to start making decisions about taxation. It's not an option not to make these decisions - one way or another, they have to be made. There is no option for them to simply "not play the game". They must.
And once they start playing, they find themselves in a crazy maze of exceptions, loopholes, provisos and special cases. If you want to cut down tax avoidance (not evasion) then you need to simplify the taxation system to the point where these loopholes don't exist. Of course, that'll never happen, because politicians for the last century have been busily creating loopholes in order to favour their particular patrons, and closing those loopholes would result in screams from said patrons.
The problem the politicians see isn't that these loopholes exist, it's that companies are using them who haven't paid politicians for the privilege.
If you write it, they will use it (Score:3)
If you don't want companies to use loopholes in the tax code to legally avoid taxes, don't put loopholes in the tax code. Let's all remember that those loopholes and deductions were all heartily lobbied and bargained for. If you didn't want them passed, why didn't you send funds to your representative in order to vote against them?
Comment removed (Score:3, Insightful)
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I'm reallygetting tired of these bullshit articles (Score:3)
Whilst the tax arrangements are strictly legal, there has been outrage on how companies are avoiding paying their fair share of tax generated in the country.
So, if the country's tax laws do not require these companies to pay their "fair share", then how exactly does one define their "fair share"??? Exactly how much more should they pay than what they are legally obligated to??? How large of an over payment would satisfy these critics???
I've seemed to notice... (Score:5, Insightful)
...more and more implicit or explicit class warfare crap in the news. I suspect it's not coincidence.
"...Whilst the tax arrangements are strictly legal..." - THAT is where blame for these corporations ends, period. Do you deliberately pay more for milk than you need to? Do you volunteer some extra taxes because the government is in a bind? Of course not. These corporations do what they do to save money however they can - and as long as they stay within the bounds of the rule/laws, disparaging them is pointing in ENTIRELY the wrong direction.
Look instead at the incompetent government that WROTE THE RULES, morons.
Hey, I "get it". I'd cheerfully decimate the companies that bundled their crap investments, the 'rating' agencies that rated them AAA, and the bond traders that cheerfully swallowed instead of spitting. Then I remember: they were all largely conducting LEGAL business according to the rules and laws set forth by ... our incompetent government.
THEY would have suffered the natural result of their actions in the market, but then they were PROTECTED from their results (gotta make sure they get their bonuses, ya?) from...our incompetent government.
Want to know why I'm a libertarian conservative? Because in 45 years I've become convinced that while often it is well-meaning, almost all government is incompetent, and therefore the least possible government is best. Which is better, semi-anarchy where one is free to build ones own future as best one can, or some sort of perpetual serfdom to the landed classes that see us only as rubes to exploit, cows to milk, or votes to pander to?
Re:I've seemed to notice... (Score:5, Insightful)
LMFAO. The government is incompetent and writes bad rules so they get exploited... I'm a libertarian so we can have less rules... That's like saying "I got mugged once - the police system doesn't work! Let's abolish all laws."
This is why libertarians aren't taken seriously. If you really think semi-anarchy leaves one free to build one's own future, you should take a look at (semi)-anarchies throughout history and across the world now. Warlords, (robber) barons, and a feudal system do not make for a better world.
Re:I've seemed to notice... (Score:5, Insightful)
some sort of perpetual serfdom to the landed classes that see us only as rubes to exploit, cows to milk, or votes to pander to?
That's what we have right now, which is why the subject is being debated so much. Class warfare has been in place for generations, and the rich have won it. Again. This is not the first time in history, either. The last time, the result was really really ugly. The French Revolution is the favorite example of just how ugly it gets.
So. We're talking about it. Again. Because it happened. Again. Now it's time to figure out how to bash them back into a box so we can get on with civilization for another few hundred years until the next time the sociopathic assholes win the rigged game AGAIN. It's about goddamn time there was some reverse class warfare. Again. But this time, we're trying to figure out how to accomplish it without blood in the streets. There are a lot more of us now than there ever have been before, so if we do it French Revolution style, you could only dream of your semi-anarchy where one is free to build one's future as best one can. What you'll get instead is pogroms that would make Stalinist Russia look like a picnic in the park with sunshine and birdies and champagne.
Capitalism has broken civilization. Again. It happens on a regular basis. It's a bug in the system. Historically, the solution to the bug is a system reboot with guns. This time, we would prefer to fix the problem without armed revolution. We like peace and quiet. We like it quite a lot. Violent crime has been declining even in the gun-happy United States. But we DON'T like playing in a rigged game we're guaranteed to lose because a very very small group of people have already won it.
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I made no threats whatsoever. I made repeated reference to historical fact— the peasants rise up, periodically, and they have done so violently essentially every time. What I actually said was, we are collectively trying to avoid that situation happening again. I, personally, am unlikely to be part of an armed mob, mainly because I'm unarmed. I own no weapons more dangerous than a kitchen knife, and that's unlikely to change. Therefore I have a vested interest in trying to solve the problem witho
Re:I've seemed to notice... (Score:4, Insightful)
Do you pay more than the menu price for your cup of tea?
Do you give the taxi driver more money than is displayed on the metre?
Do you pay the neighbours' child an extra few quid for washing your car?
No so black and white anymore, is it?
We need a FLAT TAX, one fair percentage for all! (Score:3)
The real problem is *what* is taxed. Income is bogus. I don't see why, when I go to work, the money I earn is taxed at a higher rate than the income derived by a rich person's trust fund. No, "income" is a bad tax. What we need is a "net worth" tax. 2 or 3 percent should do it for everyone, including companies, because, companies are people too. They have 1st amendment rights according to SCOTUS, let them pay up as well.
Everyone calculate their net worth and pay 2-3% no exemptions.
Zero-tax states 'stealing'? (Score:3)
Is it really the case that zero-tax havens like Bermuda and the Cayman Islands are 'stealing' from countries like the US or UK? They are providing an alternative to double-digit corporate taxes in other countries, but can they really be accused of stealing if they are charging 'zero' in taxes?
Was Microsoft 'stealing' from Netscape when MS bundled a browser with the OS for free?
Do food pantrys 'steal' from grocery stores by giving away what the grocery store sells?
Re:compete instead of complain (Score:5, Insightful)
If only this could apply to regular people - Hey some people are shoplifting the food from the market, let's just lower the price to a point where it's not worth bother... But I guess this only applies to the well-to-do..
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More like, Store A is charging $20 for a loaf of bread, I'll go to store B where I can get it for $5.
Google isn't stealing money. The government is.
The irony is in the politicians these companies choose to support knowing those politicians want to jack up taxes on them. They like the populism of that thought, but not so much the consequences.
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Didn't you hear? Keeping your own money is stealing now.
Re:compete instead of complain (Score:4, Insightful)
Of course not. But deeply relying on other services that cost money to provide, while not providing a cent to pay for those services and expecting everyone else to pay for them isn't much better.
If, for example, Google didn't rely on the public education system, the transportation system, the military defense of the country's borders and other interests, communications infrastructure, the judicial system, and so on, then there would be no issue. Instead we basically have a corporate free-loader. And Google isn't unique. There are a lot of them. BIG ones. World-wide. Yeah, it's their money, and why should the government "steal" it from them? On the other hand, somebody is getting something for nothing via creative accounting that few regular taxpayers can arrange, and making much bigger *real* profits somewhere because of it. They aren't stealing, but they are corporate moochers, happily doing business in countries they can take advantage of for plenty of "free" stuff paid for by the rest of society.
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I forgot to add: there is *nothing* illegal about what they are doing. It's perfectly legal. But that's the crux of the problem. What's legal isn't fair in this case, especially when everybody else has to pay higher taxes and/or endure "austerity measures" to make up the difference.
You can argue that the real solution is to lower the costs of government, to which I'd say: yeah, I'm all for making government more efficient. But even if you did that it wouldn't change the fact that regular taxpayers and s
Re:compete instead of complain (Score:5, Insightful)
Lets at least get the metaphors slightly more accurate.
Store A is charging $20 for a loaf of bread, but provides an awesome atmosphere, chairs, clean eating space, nice employees, free coffee, and massages while you eat your loaf of bread. Store B sells the same bread for $5, but you can't eat your bread there. So you buy your bread from Store B, and then expect Store A to let you stay in Store A to eat your bread.
Companies pay taxes to pay for the externalities that they take advantage of while doing business in a country.
Re:compete instead of complain (Score:5, Insightful)
It's funny you mention that, because in a competitive capitalist market price approaches cost. Therefore, people get that lowest price for their labor and do not need to steal as much. In non-capitalist systems, where prices are elevated, people DO have to use unethical means to get food ( for example, in Soviet Russia, hoarding, sneaking, stealing food etc etc)
Incorrect. This is only true in free markets. In markets where cartels and price fixing are allowed, and information about pricing can be hidden, then prices can be artificially held well above cost.
Re:compete instead of complain (Score:5, Insightful)
a place like bermuda isn't a valid country that you compete with on tax rates. bermuda's tax laws are designed to parasitically leach off the fruits of another country's labors
the idea that you think this is about fair competition is a joke, a lie, or a delusion
Re:compete instead of complain (Score:5, Insightful)
That's bullshit. Bermuda's tax laws have nothing to do with it. It is American tax law that makes the leeching so profitable.
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No, it's not. And their tax laws have everything to do with it. Their tax laws are setup such that only local companies pay taxes. Companies like Google pay nothing. Any other brilliant arguments, dipshit?
And this is somehow their fault? If positive, can you explain why a country shouldn't be able to do whatever their citizens please within their own borders?
Re:compete instead of complain (Score:5, Informative)
They do pay taxes on their income. Unfortunately, their reported profits are much lower than their actual profits (courtesy of tax loopholes like the Double Irish strategy). Their are tons of articles on the internet that explains how this works. e.g., http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html [bloomberg.com]
Re:compete instead of complain (Score:4, Interesting)
Owners can live anywhere in the world. Corporations should pay taxes where the profit is generated to help pay for the external costs that made those profits possible.
Re:compete instead of complain (Score:5, Insightful)
Have you ever heard of some sort of investment bubble that went out of control recently ? Where do you think all that money comes from ? Its because some people accumulate so much that they never take it back as "income" that such bubble form. Some people are getting too much money, and that destabilize the economy in many different ways. More balanced income prevent the formation of bubbles because nobody has insane amount of cash to move around and demand 15% returns every year (in a 2-4% growing economy, including the housing market bubble, that's very sustainable, right). The giant money drain is taking real money from the real economy, and makes it an improductive lump that moves around stock exchanges worldwide, putting pressure on industry to demand unsustainable ROE, and inflating the next bubble that will destroy the economy when (not if) it collapses. That must stop.
Re: (Score:3)
Here's a thought; if you want companies to pay more taxes then make taxes reasonably low enough that companies find it more bothersome to play legal shell games than simply pay a tax.
Well... opening a shell company in a tax heaven and paying 3-4 accounting critters to take care of recording profits in zero-tax places is going to cost the company probably... say... half a million/year? Are you sure you want corporate taxes lowered that much in US/UK?
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because you are seeking to attack the very people that have the legal and financial resources to simply shift money elsewhere where governments are less greedy themselves.
Thing is, all this "money shifting" is just legal trickery, and it's not hard to stop it.
Now shifting production is something that requires considerable legal and financial resources. And, of course, for some reason, all those companies are not clamoring to have their main offices, R&D campuses and manufacturing facilities in Bermuda or Ireland. Only the accounts. So it sounds like it's not so simple to shift, after all. And if they want to enjoy the economy that lets them be so productive, why shouldn'
Re: (Score:3)
Try that suggestion when the whiners actually CAN.
As much as you hate to admit it the elite DO have special privileges not available to the unwashed masses.
Re:Corporations should be justified (Score:4, Insightful)
Trouble is, governments can be sociopathic bureaucracies just the same.
Re: (Score:3)
Hasn't this sort of thing been going on for quite a while with large companies? Heck, even smaller companies. It's always in the best interest of the business to keep as much of their profits as possible, and since it's only slightly trivial to buy a politician, loopholes will exist for the foreseeable future.
Yes, if someone's going to be outraged they should be outraged at the laws that allow it rather than the companies that do it.
Re: (Score:3)
It is available, actually. You could set up a trust fund in Bermuda or elsewhere. However it doesn't make much sense for most people to use it because most people want to spend their income on things useful for themselves. You don't typically live in one country, receive income in another and want to spend that income in a third country - why would you? You want to s