Slashdot Mirror
Google Founders Cut Salaries to $1
GeneralCern writes "MSNBC Reports that Google founders Larry Page and Sergey Brin, and CEO Eric Schmidt
all slashed their salaries to $1
last year. Since you do not have to pay FICA, Medicare, or income taxes on
the capital gains associated with stock sales, they stand to substantially decrease
their tax burden. Is this a breach of the company's "do no evil" mission
statement, or just an example of people who love their jobs so much they don't
need to be paid to go to work?" Update: 04/09 13:11 GMT by H :And don't trust the above tax lines; it all depends on how sales are done; moreover when you are worth X amount with stock, I suspect the "tax burden" of what is, relatively speaking, a salary that's small compared to networth isn't a substantial impact. Sorry folks; poor story.
Does the US have a minumum wage?
Can you get done for underpaying yourself, or does the wronged party have to complain to start legal action?
# cat
Damn, my RAM is full of llamas.
It's neither a breech of "do no evil" nor an example of their love of work... it's a legitimate way of avoiding paying tax which is standard practice for business leaders everywhere.
Total non-story; yet completely on message for the nonsense that Slashdot has decended into over the past few years. News for nerds? Barely. A barrage of pointless bollocks? Definitely.
Look,even if I pay 75% tax on 200,000 dollars I STILL MADE MONEY! 25% of X == > 0 if X !=0. They got payed less, how is that anything bad?? Sad that the posts on /. are trolls these days.....
Does that mean that in soviet Russia Slashdot posts you?
Oh,for the love of gos and country, kill me.
I mod everyone down who says "I'll get modded down for this." I hate to disappoint.
In the CEO biz, your total compensation is the way you get compared to other CEOs. It appears to be a kind of penis-measuring exercise (female CEOs aside) - after all, does a $20M CEO really work twice as hard as a $10M CEO? The usual justification for big CEO pay is "everyone else does it".
I hope the $1/year salary is their way of saying "we may be a public company, but we aren't going to play those games - we run Google because we want to solve hard problems and make money at it, not so we can wave our paychecks at Yahoo's management and laugh about how small they are."
To a Lisp hacker, XML is S-expressions in drag.
Tax AVOIDANCE is lawful and completely honorable.
.... The question arose whether the law which imposes such a tax upon them was constitutional. The opinion of the Attorney General thereon was requested by the Secretary of the Treasury. The Attorney General, in reply, gave an elaborate opinion advising the Secretary of the Treasury that no income tax could be lawfully assessed and collected upon the salaries of those officers who were in office at the time the statute imposing the tax was passed, holding on this subject the views expressed by Chief Justice Taney. His opinion is published in Volume XIII of the Opinioin of the Attorney General, at page 161. I am informed that it has been followed ever since without question by the department supervising or directing the collection of the public revenue..."
...A tax upon one's whole income is a tax upon the annual receipts from his whole property, and as such falls witin the same class as a tax upon that property, and is a direct tax, in the meaning of the Constitution....
...We have unanimously held in this case that, so far as this law operates on the receipts from municipal bonds , it cannot be sustained, because it is a tax on the powers of the States, and on their instrumentalities to borrow money, and consequently repugnant to the Constitution. ...it follows that, if the revenue from municipal bonds cannot be taxed because the source cannot be, the same rule applies to revenue from any other source not subject to the tax; and the lack of power to levy any but an apportioned tax on real and personal property equally exists as to the revenue therefrom.
...that personal property, contracts, obligations, and the like, have never been regarded by Congress as proper subjects of direct tax. The United States Constitution provides Congress the power to lay and collect taxes directly only as long as it is apportioned with regard to the census or enumeration."
Tax EVASION is illegal.
The payment of taxes is not a moral oblication, and "fair share" is not a legal term. It is used to intimidate and confuse people.
"The legal right of an individual to decrease or ALTOGETHER AVOID his/her taxes by means which the law permits cannot be doubted" Gregory v. Helvering, 293 U.S. 465
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Pollock v. Farmers Loan & Trust Co., 157 US 429 (1895)
This decision states that it is unconstitutional to impose the income tax on the interest and dividends, on the deposits of U.S citizens, in U.S. banks, because that would be a Direct Tax WITHOUT APPORTIONMENT, which is not authorized, and is, in fact, prohibited by the Constitution.
Excerpts from the decision:
"...Ordinarily, all taxes paid primarily by persons who can shift the burden upon someone else, or who are under no legal compulsion to pay them, are considered indirect taxes; but a tax upon property holders in respect of their estates, whether real or personal, or of the income yielded by such estates, and the payment of which cannot be avoided, are direct taxes..."
and;
"...Subsequently, in 1869,
and;
and;
Admitting that this act taxes the income of property irrespective of its source, still we cannot doubt that such a tax is necessarily a direct tax in the meaning of the Constitution.
In England, we do not understand that an income tax has ever been regarded as other than a diect tax. In Dowell's History of Taxation and Taxes in England, given, and an income tax is invariably classified as a direct tax..
and, even in dissent:
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Brushaber v. Union Pacific R.R. Co., 240 US 1 (1916)
The Brushaber decision determined that since the provisions of Article I of the Constitution were not repealed, they are still in full force and effect. Article I, Section 2, Clause 3, and Article I, Section 9, Clause 4, BOTH specify that Direct taxes MUST BE APPORTIONED (to the state governments for collection). The Court ruled that:
As your lawyer friend said, tax evasion is illegal. Tax avoidance, however, is not only legal it's encouraged -- hell, even the President wants you to pay as little tax as possible (if you're already rich). That's all these Google folks are doing. Fortunately, the law doesn't care if you're rich, even the poor can avoid taxes if they're careful. Back when I was in school and filed a 1040EZ I was able to cut my tax burden at least a little each year; now, with a house to kick me into itemized deductions, I milk it for all it's worth (e.g., don't throw anything away -- take it to Goodwill and let them throw it away; meanwhile, you claim the donation.
If all this should have a reason, we would be the last to know.