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Microsoft To Get $100M Annual Tax Cut and Amnesty
reifman writes "Despite a $2.8 billion deficit, Washington State's House Bill 3176 would provide Microsoft with an effective $100 million tax cut annually and possible amnesty on its $1.27 billion Nevada tax maneuverings. Under current law, all of Microsoft's worldwide licensing revenues of approximately $20.7 billion annually are taxable at .484 percent. Under the new law, only the portion of software licenses sold to Washington state customers would be taxable. Ironically, after slashing Microsoft's tax burden, HB3176 directs the Department of Revenue to crack down on 'abusive tax transactions' like those in Nevada — except for a loophole that may provide Microsoft amnesty on its twelve year practice. The bill's lead sponsor is Ross Hunter of Medina, home to Bill Gates and a number of current and former Microsoft billionaires and multi-millionaires, and other areas around Microsoft's corporate campus."
The bill's lead sponsor is Ross Hunter of Medina ...
The article's update notes:
Update: Rep. Hunter is a former Microsoft general manager.
As does his bio:
PROFESSIONAL EXPERIENCE:
I retired from Microsoft in 2000 after 17 years of service ranging from program manager for Microsoft Access to general manager of the Microsoft Commercial Internet System.
At this point apathy consumes the rage that would normally well up inside me ... Halliburten got contract after contract with a former employee as vice president of the United States ... should this sponsorship surprise me? I guess it doesn't fall under conflict of interest though a large part of me feels it should ...
My work here is dung.
Our system of government may not be the best, but it's the best that money can buy!
I have no objection to the government taxing my income at 0.484%
93rd rule of Slashdot: No matter how obvious my sarcasm is, my comment will be taken seriously by someone.
I see the authors are using the phrase "Microsoft to get" to mean the less-common "Microsoft may get if a bill proposed by one Representative is passed by both Congressional bodies in its current form which is not going to happen."
Scintillating!
Politicians get into power by getting corporate sponsorship, once they are there they quite naturally pay back the favour. Really, the Politicians are not much more than Corporate Representatives in Government. There is the minor formality of convincing the public to vote for the company candidate but you just throw money at that and hire good advertising companies.
The US has the best politicians the corporations can buy.
Sadly up here in Canada, its no different as far as I can see. I still believe in democracy, but I am no longer sure we still have it :(
"The first time I got drunk, I got married. The second time I bought a chimpanzee, after that I stayed sober" Arian Seid
http://apps.leg.wa.gov/billinfo/summary.aspx?bill=3176&year=2009
Alot of stupid bills get submitted, luckily most don't get passed.
If this one gets enough notice perhaps the bill will be killed.
Don't know something? Look it up. Still don't know? Then ask.
To play devil's advocate, giving tax breaks to attract/keep major businesses is a normal thing for state governments. After all, these businesses bring in major direct (income taxes) and indrect revenue (local employees' property taxes, sales taxes etc) to the state. Nine years ago, Boeing ditched Seattle and moved to Chicago partly because of tax breaks offered by Chicago.
http://apps.leg.wa.gov/billinfo/summary.aspx?bill=3176&year=2009
Doesn't look like its passed yet.
Don't know something? Look it up. Still don't know? Then ask.
Democracy is a compromise, not something that requires or benefits from belief.
"I used to believe in forcing my neighbors to do things, but then they started forcing me to do things."
Nerd rage is the funniest rage.
Even Mozilla dodges taxes because they are a "non profit" and get PAID millions of dollars from google as part of a business deal. But I guess if you pay a tiny percentage of that money to pay for nerds to work on open source, you're immune from criticism on Slashdot.
Right. Because the income dealings of a non-profit corporation are really just so shrouded in secrecy, loopholes and backroom deals.
In the time it took me to respond, Microsoft just wrote off more in taxes than the Mozilla Foundation is worth.
http://www.mozilla.org/foundation/documents/mf-2008-audited-financial-statement.pdf
Blow me.
Pathological kinda promises Path + Logical - but instead, you get stuck with pathetic.
The problem isn't whether companies will make smart business decisions (e.g. moving to friendlier tax areas), it's that this is a highly visible example of "he who has the gold makes the rules".
Everybody knows that wealthy people receive preferential treatment in our society, but nobody likes having their nose rubbed in it. A situation like this one with MS, coming at tax time, just feels like a big middle finger.
Literalism isn't a form of humor, it's you being irritating.
If enough people do not believe the system is fair, it will end violently.
It absolutely depends on belief-- partially belief that was brainwashed into us from the time we were in 1st grade and partially belief from propaganda constantly delivered by all the media sources ( "liberal", "conservative" -- no real difference- all are owned by extremely wealthy individuals and corporations and serve the same brainwashing crap).
She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
Illinois is set to become the next California. This post points out that Cali gave huge breaks to tech companies.
Giving 'tax breaks' doesn't seem to be sustainable long term for states.
Seriously, this entire state is one huge cluster fuck dictated by a single geographical area. It needs to be roped off, along with Gary, and made its own state.
They should then be required to where corporate logos on their suits just like they do in NASCAR...
I have no problem with this.
OK - so Microsoft employs how many people in Washington?
Around 40,000, as I recall. Let's give about 30,000 as the number of children and another 20,000 for spouses and significant others. Let's devote around 1300 teachers for those kids, and about 400 administrators for those teachers (up to the state level, and I think I'm being conservative). Let's factor in the infrastructure businesses that exist in Washington whose entire existence is centered around Microsoft.
So, between the load on the roads, the educational system, firefighters, police and other essential services, you're entirely satisfied that Microsoft is giving at least as much as it takes from your state? And that the rank and file employee state taxes fairly offset those for the MS cream of the crop?
You live in Washington, have considered these factors, and still believe that Microsoft is a good corporate neighbor?
Okay, so I'm a Microsoft employee, so factor that in however you want. I'm also a citizen of Washington, and it seems like your argument ignores that. I pay 9.5% sales tax on everything I buy, I sort of pay property taxes (I pay apartment rent, but the landlord takes some of my money and pays property taxes). I pay gas taxes, I pay to register my car, I pay stupidly high liquor taxes. There's no state income tax, so I don't pay that, but a lot of Microsoft employees have pretty expensive houses, so they pay a ton in property tax. Sure, there are more/bigger roads in Redmond than would exist without Microsoft, but as a citizen those are the roads that are most useful to me - isn't that why I pay my gas & vehicle registration taxes?
I don't know anything about this specific tax, and don't want to comment on it. But I'm always confused when I see the argument that Microsoft takes from the state, and that we'd be better off without it. I spend a lot of money in the local economy, pay quite a bit in taxes, etc. If Microsoft left, it'd be a disaster for the economy on the Eastside, and probably all of Seattle.
Your argument about the roads, schools, firefights, police, etc. just doesn't make much sense to me. Microsoft employees are citizens like any other (but since they tend to be pretty well paid, they're going to pay more in taxes), so of course they're going to use state/local resources. I am going to live somewhere, and I'll need roads, firefighters, police, etc, so some state and local government is going to tax me and be responsible for providing those services - because Microsoft employs me here, it's Washington/King Co./Redmond. I don't use the schools, I don't cause a burden to the police, I don't get any assistance from the state. I use the roads, parks and libraries. Like a lot of Microsoft employees, I'm young and have no kids, so I'm not using the schools, but I'm paying for them. I have to think that I pay way more into the system than I get out of it. That's fine, but if Microsoft left I'd probably leave too (I'm not a native Washingtonian, and can't imagine I would have moved to Seattle if not for this job), and from the perspective of state finances I think that'd be a loss for Washington.
Maybe we should kick all employers out of the state. If no one lived here, we wouldn't need any schools/police/firefighters/roads at all. The state budget problems would be solved!
Microsoft: too big to tax?
I prefer rogues to imbeciles because they sometimes take a rest.
Parent marries two flawed ideas that don't belong together and then somehow calls this a justification.
1. Local Government is somehow a spendthrift. This is a Sarah Palin explanation. The people with little comprehension of what their government does whip this explanation out to beat down their enemies. My civics class from grammar school taught me that local government provides public services and infrastructure. You know those awful spendthrifts just wasting our taxes on roads, and sewage systems... Let's do away with law enforcement. Courts too. People that use this kind of thinking have one goal, a return of the truck system. http://en.wikipedia.org/wiki/Truck_system
2. Parent makes the leap that a high-tax environment is somehow hostile to business. The goal of the comment is to make the Corporate Welfare State as big as possible. Shift the entire tax burden away from the corporation to the employee. (not the Owner of the business, the employee)
It is much more expensive, and almost impossible for Microsoft to leave. This is true with any giant-sized super-mega corp. facility. I'm not saying it doesn't happen. I'm saying it happens nowhere near the level of fear the remark generates. The goal behind the fear mongering is to complete the Corporate Welfare State.
http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
You are seeing the red state/blue state sort-of lie. We don't really have that division as much as we have red areas, primarily rural and suburban, and blue areas, primarily major metropolitan areas. You can see it on the larger election maps, most fixate on the entire statewide breakdown and how the vote went in total there, but if you look at it state by state by state, the same red/blue split shows up, and it is primarily urban versus "other".
So what happens is the metro areas in most of the states dominate politics, they have the edge in population a little bit, in most states now, and institute policies and laws that never really fit their *entire* respective states. What you said about Illinois and Chicago is true facts, the same applies to like NYC and the rest of NY, or here where I am, Atlanta versus the rest of the state.
Here is an interesting site that breaks this political split down more with various maps and corrected projections. It is quite interesting and there are links to more detailed analysis. The gist of it is, in the big elections and the general political pull of the nation, it is urban versus everyone else all the time. It fluctuates a little bit, but not much really.
http://www-personal.umich.edu/~mejn/election/2008/
The quickest way to see it on that page is first look at the normal state by state red/blue split (this is a look at the 2008 election), then scroll down to the first "Election results by county" map. The differences are very easy to see there and profoundly obvious.
Causes all sorts of problems all the time, and will continue to do so. And it isn't fair either way you look at it, from either perspective. There really needs to be a different political arrangement, so the major urban areas can have various laws that fit them much better, but without insisting on the same exact laws in the rural areas, and vice versa. As in maybe drop the notion of the political boundaries we have now and switch to what the boundaries really are, smallish city-states and huge "other than that" states as separate political entities.
We have federal and state governments that keep trying to hammer square pegs into round holes and it just doesn't work very well, there is no real compromise even possible that would work and be more acceptable to all concerned.
And it's not like this wasn't anticipated back at the beginning of our Union, this was the original idea with having both senators and representatives, instead of just representatives...That fix didn't last long, primarily I think because they didn't think it through far enough ahead in time to the point where there would be so many multi million person large cities, inside virtually every state in the nation. They thought it would remain like less populated states versus more populated, not realizing the political split would fall inside every single state for the same reasons, that urban realities are just different from the rural and suburban.