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US Competitiveness Chief Immelt's GE Tax Bill: $0
theodp writes "'He understands what it takes for America to compete in the global economy,' President Obama said of GE CEO Jeff Immelt, as he announced Immelt would chair the President's Council on Jobs and Competitiveness. On Friday, the NY Times reported that one trick Immelt employs to keep GE competitive is paying no American tax bill. In fact, GE claimed a 2010 tax benefit of $3.2B on worldwide profits of $14.2B, $5.1B of which came from US operations. According to the NYT, GE's extraordinary tax-avoidance success is based on an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore. GE's giant tax department is led by a former Treasury official whose 975-member team includes former officials not just from the Treasury, but also from the IRS and virtually all the tax-writing committees in Congress. GE's return to rock-bottom tax rates marks a dramatic reversal from the mid-80's when President Reagan reacted to corporate accounting gamesmanship and supported a change that closed loopholes and required GE to pay a far higher effective rate, up to 32.5%. 'That GE can almost set its own tax rate shows how very much we need reform,' said Rep. Lloyd Doggett. 'Our tax system should encourage job creation and investment in America and end these tax incentives for exporting jobs and dodging responsibility for the cost of securing our country.'"
They've got almost 1000 people reasonably employed. Surely that's worth something.
Ok, so a good number of them are probably lawyers, others are soulless accountants, but hey, they'd be doing that regardless.
I'd like to point out that GE used to (and still does) fund MSNBC which continually loves to deride corporations and the so called "Fat Cats" on Wallstreet. Oh the irony... Apparently it's okay to not pay taxes as long as you're friends of the current Administration. May I also be the first to ask why is this story on Slashdot, and why is it a weeks late?
As a member of poor America, thanks for confirming my beliefs.
Just like people hire hackers and crackers to improve their security, maybe higher tax evaders to reform tax laws is a good thing.
Some drink at the fountain of knowledge. Others just gargle.
You elected George and Dick twice in a row.
Tell me you're surprised. I dare you.
You can't hand out massive subsidies and tax credits for green energies and then complain when the largest recipient of those credits and subsidies ends up not owning the government money. Here's a hint, when you offer the rich/smart corporations money and ways to reduce their tax burden, they take it. So which is it that you want? Do you want them to pay taxes or do you want them to develop highly cost ineffective green technologies that they wouldn't otherwise develop because they couldn't make the right profit on it. You can't have it both ways.
How is this not fraud?
Would you be deriding this article if it had a left-leaning slant as opposed to its obvious right-wing spin? I must ask this because someone with a 5 digit UID must have surely seen the dozens of other non-tech political articles that have made their way past our ever-diligent editors and the mighty Firehose.
I agree with you, but, Slashdot has become a pit of anti-corportionalism. If it involves a corporation getting away with not putting a plastic bottle in the recycling bin, it will be on good ol' /.
(Don't my UID, I've been here a long long time)
Slightly O/T, but in a related vein, is there a good political blog for intelligent people where stuff like this should be posted? At least something with some kind of good moderation system and user base, ideally that isn't too slanted?
-- IANAL, this isn't legal advice, and definitely isn't legal advice for you. Also, Squee!
The reason wealth concentrates more and more is because of the Federal Reserve system, where the banks (NOT the government) create the money supply by making loans.
And now "Deficit Terrorists" are campaigning to slash federal spending. The real reason the federal debt is skyrocketing is because the banking system can't make loans like it used to, so the Federal Government has to be the "borrower of last resort", taking out loans from the "lender of last resort" (the Fed) and everyone else.
I don't remember the exact figure, but 40-50% of the Federal Government's debt is either held by the Federal Government (in the Social Security "trust fund"), or by the Federal Reserve (which is held to "back" the money supply). 100% of the interest paid to the ss trust fund is returned to the government, as are most of the Federal Reserve's profits (after operating expenses and a fat dividend to its owners, the private banking system).
If the debt were to be instantaneously paid off, all money would instantly vanish from the economy.
If the federal reserve system was nationalized, and the Department of the Treasury could issue debt-free "greenbacks" (like Abraham Lincoln used to pay for the Civil War), wealth would be much less concentrated that the current status quo.
Required reading:
Money and the Crisis of Civilization
A Bailout for the People (pdf).
Learn the rules so you know how to break them properly.
www.teslabox.com
if you think there is something wrong with GE's behaviour. You might as well bend over.
Would you be deriding this article if it had a left-leaning slant as opposed to its obvious right-wing spin?
I don't think he's deriding the article, just the presence on Slashdot.
I fully agree with the article, but I too question why this is on Slashdot... juste because sometimes there are other purely political stories, does not make it OK this time.
On the other hand the political world is so intertwined with all fields now perhaps it's time to abandon the illusion that all technical stories are not really political stories to some degree, and allow even totally non-technical stories like this one as well by way of showing how technology truly gets funded these days.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
A pit of anti-corporatism.
And grammar Nazism.
A pit of anti-corporatism and grammar Nazism, spouted from a comfy chair.
Slashdot.
Amongst the three weapons of slashdot readers are anti-corporatism, ...
I really don't understand why everyone is upset with GE, they're doing what corporations are supposed to do, make money.
It's the politicians that are writing the laws so they don't have to pay taxes, it's every one of those corrupt bastards that created a system that allowed this to happen. Why isn't anyone screaming for the heads of the tools in congress that take kickbacks to write laws that let them do this?
...it's almost as if all the powers we hand to our government only end up being abused; as if the vast majority of government is a disease masquerading as its own cure; as if the object and practice of liberty lies in the limitation of governmental power, not in its expansion or perpetual rearrangement.
(Financial) Imagination at Work
What is ironic is people still love to yell and shout about how Republicans are so in bed with their corporate tax-evading buddies.
What is sad is the GOP on the candidate and national level is still so inept and scared of being called racist they don't look good to beat the most blatantly corrupt president of post-WW2 America.
It's only an 'obvious' right-wing spin if you completely discount the part about the guy being hired by the current DEMOCRATIC President. You DO remember he's a Democrat, right? Both parties are to blame for this mess; the Democrats just put a better spin on their corruption. You'll notice fuck-all was done about Wall Street during the two years the Democrats had control of the White House _and_ both houses of Congress.
Hey, I resemble that remark. Techie...Yes, Communist...Not quite, more Socialist, Jewish...Yep.
I know the definitions of "News for Nerds" is very broad, but does this really belong on Slashdot? It's a straightforward article on corporate taxes without a sci/tech or otherwise nerdy slant. Wouldn't this be better discussed on a real political blog?
The reason this is on Slashdot is simply that the article was posted via the NYTimes twitter feed. This has to be News for Nerds! Sides, we have to do due diligence, and make sure whoever is choosing to re-tweet the NYTimes feed doesn't get sued.
Right?
(bird chirps)
---jstlook ---For that is the way of Elves, for they say both yes AND no, and mean every word of it. --- J.R.R.T.
Slightly O/T, but in a related vein, is there a good political blog for intelligent people where stuff like this should be posted? At least something with some kind of good moderation system and user base, ideally that isn't too slanted?
Yeah, it's standing over there behind unicorn.org.
http://www.gereports.com/setting-the-record-straight-ge-and-taxes/
- GE paid almost $2.7 billion in cash taxes in 2010 on a consolidated basis (almost 19% of pretax income from continuing operations).
No-one outside of America (and, I suspect, a whole lot of people inside America) would consider the Democrats to be Left-wing. They're Right-wing, just not so crazy Right-wing as the alternatives.
"Stuff that matters"?
Absolutely. I have to be careful to make sure I'm not drinking anything whenever someone calls Obama a 'Progressive'.
Crybabying about low corporate taxes is fashionable, but doesn't really hold up to reason. It's just a way for certain types of people to rouse the rabble about how the "fat cats" (be they fat cat Washington politicians, fat cat lawyers, fat cat CEOs, fat cat top-hat wearing bankers with monocles, you name it) are pulling one over on Joe American. What's funny is we're soon approaching the point of no return where on average Joe American pays no net taxes, so it's hard to imagine the kind of contortions you'd have to go through to whine about corporate taxation then.
Anyway, corporations don't realize profits - people do. And corporations are not people, not even legally. It's certainly cool to blather about how "corporations are legally people!!" but it's simply wrong. They have some legal protections similar to those of a person, but it's not hard to tell the difference.
Corporate "profit" goes towards either creating jobs or as real profit to a person. You want the first, and you tax the second. The only gray area is when corporations helpfully buy someone something, e.g. they buy their CEO a car that only he ever uses and that he uses for private business. That should be taxed.
3.2 Billion - 320 million people in the U.S. Roughly half pay taxes (unemployed, children and so on of course don't). That works out nicely to: $100 refund for 20% of the U.S. population who pays taxes.
From one company working the system. ONE. Out of several hundred such companies that are manipulating things to their benefit.
You want a tax cut for the working people? How about making the corporations pay their fair share. There's more than enough money in their coffers to make taxes a thing of the past for the poor and middle class, as well as for small business owners and the self-employed. How does "if you make less than $50K a year, you don't have to file taxes at all" sound? You want to spur growth at the lower levels and create a solid foundation? Get rid of this burden. Doubly so on small businesses. You should get a tax *rebate* for starting a new business at this point. Instead it costs hundreds in taxes and fees. And that's if you aren't in California or some other state that really sticks it to you.
In fact, this is one thing I cannot fathom. How the RNC and big business (which are essentially one now - with the other party quickly being subverted as well) have managed to still get support from the very people that they shaft over and over again. Big business won't trickle-down. They won't save us. They won't create jobs here at home. What's good for big business is not good for the rest of us. It never has been. We need to wake up and stop letting them get away with this. Because all we're doing is strangling the very people and small businesses that we need to create the next generation of jobs and innovation.
In case you weren't paying attention, big business and small business are diametrically opposed at this point. So when they say "we're all for business" - you have to ask the greaseball politician who's mouth is flapping which "business" they are talking about. You probably won't like the answer, though.
Just push the global community of governments for higher corporate taxes all around. It'd be like price fixing, except with tax rates. That increases the income in these emerging economies and ensures that companies pay taxes SOMEWHERE. If a country refuses, impose trade restrictions. That gives gov't control of how taxes are collected, even if not within their borders.
America is all about speed. Hot, nasty, badass speed. -Eleanor Roosevelt, 1936
Both parties are to blame for this mess; the Democrats just put a better spin on their corruption. You'll notice fuck-all was done about Wall Street during the two years the Democrats had control of the White House _and_ both houses of Congress.
The financial regulatory bill exists, and was in fact passed into law. Like the health care bill, however, it was fillabustered into near-ineffectiveness; most of the big reforms were bargained out of the bill in order to get a single Republican to agree to not fillabuster.
The essential problem in American politics is that most of the money comes from large donors, eg. corporations and the very wealthy. Small donations from individuals are so rare that it's actually historically relevant that Barak Obama received fully half his 2008 campaign money from small donors, making him one of the first presidents in recent memory actually bought and paid for, at least halfway, by the people. This explains why he has to date kept more than three times the number of campaign promises than he's broken (though he would have been able to keep more of them if Congress didn't, for example, block funding for the closing of Guantanimo) which for an American politician is shockingly true to his word.
reddit.com/r/politics
Implying the firehose has always existed when in fact it's a fairly new feature.
Still waiting on Serviscope_minor to wake up to fucking reality and realize that Jessica Price isn't going to fuck him.
You can be sure that this isn't a surprise to the people who receive the benefit of political lobbying...
GrpA
Enjoy science fiction? "Turing Evolved" - AI, Mecha, Androids and rail-gun battles. What more could you want?
If a corporation is a person for legal purposes, it should be a person for taxation purposes. Why is this not the case already?
Maybe scale up the personal exemption based on the number of full-time employees (or number equivalent to full-time employees, if part-timers). Then pay on the same sliding scale as the millions of actual persons in the USA. Effectively, the corporation would be treated like a person with a number of dependents/spouses/whatever equivalent to its number of full-time employees.
Those who can make you believe absurdities can make you commit atrocities. - Voltaire
NBC, MSNBC, CNBC are all mouthpieces of the Obama administration. GE will probably/or already has land(ed) contracts in health care information systems, solar, rail and even the "smart" odometers for cars. Not to mention the TARP money that GE Capital got after the converted themselves to a bank. "Imagination at work" - by some lobbyists and tax accountants. Disgusting! Any word on what Jack Welch thinks?
With even the "do no evil" Google doing major tax evasion, is anyone surprised an old boy's club like GM is doing even fancier tricks? I'm at the point now where I don't even consider companies that are net tax neutral to be that bad. You have to actively be siphoning money away from the taxpayers via bailouts and unprosecuted financial fraud to register on my radar nowadays.
There has been a Firehose for the two years I have been here... you have an odd definition of "new".
It is also sad that some people think that the theory of Economics they read in textbooks works as advertised in an international environment.
Unfortunately I don't see how the "tax breaks" to GM and others have improved the unemployment situation in the US or the US economy. What I see (and I could be wrong) is that the money that they save is invested elsewhere, where it is more profitable. They do invest in lobbying, but I doubt that trickles down to the rest of us.
Last year the US government paid me back my tax witholding, plus $4000. I have a problem with that. I'm an American. I don't expect the government to pay me for the privilege of living here, enjoying the benefits of being in the land of the free. I figure that money, and some more, could have gone to buying down our debt and, difficult as it was, I'd have paid it. Now, because I took this money I have complicity. I am complicit in the downfall of the republic. I'd rather they kept me out of it and paid our bills with ready cash.
Help stamp out iliturcy.
Yes, lets `reform.' Lets add another several volumes to the gargantuan tax code to make it `fair.' We'll do a really good job so money can't wiggle out and dodge our good work; we're smart enough to write thousands of pages of brilliant new `fairness' that won't simply expand the playground in which the lawyers play. Right?
We'll need to be careful to not impact our `non-profits' however; tens of billions flow through the exempted `non-profit' bits of the medical industry. Also, we'll want to not draw any parallels between the exempted GE and the low-income individuals that count themselves among the exempt. No, we'll need to make sure the blinders that allow us to focus exclusively on corporations remain firmly affixed.
Our governments are going broke because the only people contributing revenue are middle class workers. Everyone else is exempt.
Any time you have a 975-member team to do your taxes - I don't care how big a company you have - something is broken. That's an immense waste, mirrored by similar wastes on the IRS's side.
That waste runs all the way down to the smallest scale. I shouldn't need to hire a professional to handle my individual tax return.
Thankyou!
Guns don't kill people, "with glowing hearts" kills people.
"...someone with a 5 digit UID..."
He inherited the UID.
This is why March 26 style protests should happen. If corporations were not able to redistribute their profits offshore then the income tax woudl go down and the countries debts would be paid off.
Then we would rebalance the way currencies are make by bringing back in the private banks doing the money creations.
Banks then have a reason not to create too much money because it comes back them them for reissus, and they themselves are accountable. It how it used to all work before the Fed Reserves were set up.
If companies don't have to pay taxes in the US, then it's a HUGE incentive for them to move as much as possible to the US. Even if they don't move ALL production to the US, merely moving corporate headquarters to the US creates more jobs (which also results in more income taxes). Also, if there are no corporate taxes, then they have no NEED to waste money on lobbying (or the billions of dollars they waste every year on complying with tax codes). But hey, why think about that when we can demonize the people providing us with jobs and writing our paychecks....
I guess in your ideal world we'd still be living in the 1700's because companies are bad.
"The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants." ~Thomas Jefferson
Did I say that companies are bad and that we need to go pre-industrial? I only said that lowering taxes doesn't always work the way you think.
Based on what I have read, I understand that GM hasn't been paying taxes and has downsized its personnel. Moving corporate headquarters or hiring more people wouldn't have increased their taxes anyway since that wouldn't have affected their profits (at least upwards). Moving part of their production to the US wouldn't be a problem either because their creative accounting would make sure that any profits would show up in some other country. The reason they are not investing in the US is because both manpower and materials are cheaper elsewhere. Eliminating taxes for them is not an incentive to do anything since they are not bothered by taxes anyway. Granted that such a thing would help smaller corporations that are not that "flexible". Of course lowering income tax would also help most of these corporations as well, since they are targeted to the domestic market.
Surely the opposite is true. If you want companies to reinvest as much money in the business as possible then you want capital gains tax to be very high. This would work fine if it were not for the way these global companies operate, moving the money around the world. If you could say "we're going to tax all your profit made in America, as worked out by us after doing a global audit", then there'd be more incentive to have less profit, and instead create more wealth by reinvestment for a time when taxes might be lower.
And of course all countries should do this, but for most governments they might be worried if they tried that game the businesses in question would just leave (can't see it happening here in NZ). But I don't think America has the same worry. If those companies did up and leave one of their biggest markets someone local would step in and all would be sweet.
Should you change your sig to read "Fun with shell corporation games"?
My first Journal Entry ever, in 8 years! http://slashdot.org/journal/365947/aphelion-scifi-fantasy-horror-poetry-webzine
Every cent of profit that a company makes will either,
1) Be reinvested
2) or show up as come sort of income on some individual's tax return.
It has long been known that corporations use all sorts of foreign tax shelters and other creative tricks to reduce their tax bill. The tax code is too complicated to try to close all the loopholes and do it faster then they lobby for new ones. All the current system does is drive money overseas. They don't and won't pay taxes anyway.
Don't tax the company, tax the dividend recipient. An individual's taxes, while sometimes quite complicated, are far simpler and allow for fewer loopholes. Disclaimer: I am employed by GE (as a bottom-of-the-food-chain factory throng with no connection to this).
Pay their fair share, oh my. However am I going to survive the kharma hit for this one.
YOU IDIOT, CORPORATIONS DO NOT PAY TAXES EVER!
Now for the nice side. Tell me, where does a corporation get its money to operate?
From consumers of its products.
Now, where does a corporation get the money it pays in taxes?
From consumers of its products.
What we have here and the class warfare ideologues always miss whether on purpose for redirecting ire from their favorite politicians or because of self ignorance which was beaten into them by the same politicians is one simple fact.
A tax on a corporation is an indirect tax on the consumer of that corporations product. This tax can be buried many levels deep as obviously not everyone makes use of every corporations services but someone does somewhere and eventually we all hit each other.
You an I pay taxes. We do it on every purchase we make whether or not there is direct sales tax on the purchase. We pay indirectly every tax bill of every corporation we do business with. This is how it has always has been.
The real crime in this story about GE is that they NEED 975 tax accountants just to pay or not pay taxes. Think about that, nearly a thousand people who produce nothing but instead are there to make a system work. Now while not all companies are as large as GE think of how many tax accountants are required to operate businesses in the US. Now think how much more production we could have if just half the people involved in taxation were instead producing goods and services.
THINK ABOUT THE FACT THAT THE IRS'S BUDGET IS NEARLY AS LARGE AS NASA'S!
So why not stop this taxation of corporations. Because politicians know the holy hell they would be in for if people saw just how much they really paid. See we can kid ourselves and believe that 20 to 30% is OK for taxes. We can guilt ourselves into it. We cannot however guilt ourselves into accepting that plus nearly 20% more indirect taxes we pay. A progressive tax system with a "corporate tax" layer is all about deflecting attention from the tax load the people actually pay. There is nothing fair about it and never can their be fairness because it is purposefully obfuscated.
Still there is an answer, a consumption tax. Drop income taxes, drop fake corporate taxes, and tax consumption. Determine the proper costs to feed, shelter, and cloth a person or family and refund that the first of each month to all heads of households. A consumption tax will get the people who spend money. It will get those who have millions and want to spend it. They won't have their offshore accounts to hide their profits because there is no tax benefit to do so.
* Winners compare their achievements to their goals, losers compare theirs to that of others.
Ok, then someone with a BBA that has read a many Econ books and attended so many classes, passed so many exams, and actually knows something about Econ should be able to respond.
First, theoretical economics and real-world economics are different things. In fact, most macro and micro Econ classes for new business students focus on the theoretical part, but upper level and post graduate focus on the real world economics. The basics are always the same: people respond to incentives. So, let's put some real world incentives in front of you.
You pay a yearly tax on your net profit produced on your income statement, and usually property tax, depending on your incorporation state, on your non-liquid assets on your balance sheet. Here's the kicker, none of this affects your cash flow until it's time to pay out the following year. So, you're given two options: 1.) pay zero tax and provide a better return to your shareholders (or cash if you're retaining earnings) at the end of the year and borrow money at a high interest to pay for the higher cost of doing business in America throughout the year or 2.) outsource my work overseas and receive a lower cash outflow while lowering my liabilities and long-term debt, since my cost of doing business is a lot lower in places where I can dump my toxic waste in the river and tell the uneducated locals it's not harmful, instead of complying with pesky laws. Considering that cash flow is more important than the bottom line for the survival of a business, I think I'll take door number two.
This is where economic theory and practice diverge. Most intro Econ books assume the market will behave rationally, and this is NEVER the case.
Another example, you mentioned corporate headquarters being moved to the US and increasing payroll tax. You've never been offered stock options in your employment contract, I'm guessing. Here's the thing, I can take a lower paycheck and receive stock options that I can exercise at a later date and AVOID paying payroll taxes. Instead, any gain from exercising my options are CAPITAL GAINS, which are taxed at a LOWER tax rate than payroll taxes. This is how corporate headquarters think. The incentive is that I get a better performance out of my managers since a huge chunk of their pay is based on the stock's performance, and they get higher income that's taxed at a lower rate. Guess who's not getting these great options. Hint: all the engineers and workers underneath us that have so many limitations on their options (if they even get them) that it's not worth it to exercise them until retirement.
You see, the only real way to increase jobs and improve the economy, is by making the markets as competitive as possible. Remove barriers to entry, empower consumers, empower suppliers by building infrastructure alternatives. Lowering the tax rate to zero isn't going to help much. If you want to increase your tax revenues, keep the loopholes and add the option to pay a tax LOWER than the cost to reach a zero tax liability. It's not the best solution, but it's better than not collecting anything and applying the tax burden to the rest of working America.
So, if you want to have a business debate, let's have at it. If you want to debate particle physics, then I can't help you beyond a wikipedia search and my knowledge retained from EngineeringPhysics in college. And since you're quoting that these rational scientist and nerds that peruse /. pickup an Econ book, maybe you should pick one up about managerial economics and management in general. The Five Forces Model is a great place to start if you want to see what really puts pressure on a business.
Good.
GE employs a huge number of people. It gives them jobs and pays their wages. It does this because it has the money to do so. The more money it pays in tax, the less people it hires.
If you're in favour of taxation, you're in favour of unemployment.
And what does the Government DO with this tax money?
The phrase "pisses it against the wall" comes to mind.
The less money Government takes and the more which remains privately held - and so used to make jobs - the better.
Why would they move their production to the US, when they can just keep it in 'insert 3rd world country here' - reducing their labor costs to just about 0, while reporting their profit in the US. That way they don't have to take the trouble of creating a profitable subsidiary in Cayman islands or a place like that.
News for nerds? I don't think so.
There have been a lot of these politically left-leaning, vitriolic article summaries posted lately. It's tarnishing Slashdot's image as a relatively unbiased and non-political web resource for nerds who just want to read about the latest tech stuff.
"(though he would have been able to keep more of them if Congress didn't, for example, block funding for the closing of Guantanimo) which for an American politician is shockingly true to his word."
http://dilbert.com/strips/comic/2007-06-01/
If companies don't have to pay taxes in the US, then it's a HUGE incentive for them to move as much as possible to the US.
This applies to people too. Which leads to the race to the bottom, where all countries slash the taxes to zero except for those too poor to be able to easily escape taxation.
Finally! A year of moderation! Ready for 2019?
"Taxation without representation" was a shared creed during the American Revolution and the converse is true as well.
"Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gains." Thomas Jefferson
If a nation expects to be ignorant and free, in a state of civilization, it expects what never was and never will be-T J
If you have political views, I would recommend a site that aligns with your political views. That is, if you're left-leaning, then something like DailyKos.
If you're really into math and mathematical analysis, then you should really read Nate Silver's column at The New York Times. He used to write/publish Baseball Prospectus and had his own blog before it was bought out by the NYT. His elections analyses are still some of the best.
Bullshit again. There will always be need for highly skilled workers, that much is obvious. Those highly skilled workers are being paid big bucks to increase efficiency and production with fewer and fewer resources, I.E., employees and payroll.
Increasing the education levels of the West's population will not solve the jobs crisis. Protectionism is the only defense we have against being obliterated by cheap labor pools. We're fine with blowing human flesh to bits in the middle east, but it is unthinkable to engage in trade war to protect one's own economic interests. Unless you are a highly successful multinational.. then game the system and its players to your heart's malcontent.
Globalization is dying. Why can't you Friedmanites realize this?
Since dividends are taxed anyway let's make GE's efforts to offshore for naught by allowing all Corporations a 0% tax rate.
Here's why:
1. Dividends are taxed...
2. Corporations that have money that is not distributed use that cushion for fluctuations in the economy, capitol improvement, improvement with energy savings, and don't have to necessarily layoff good employees during cyclical downturns in business.
3. All the effort GE has made to restructure to legitimately avoid taxes goes out the window as corporations in this country would be on an equally competitive footing tax wise.
4. By taxing dividends only (not really true as there are property taxes, payroll taxes, unemployment taxes, etc...) the double taxation can be taken away. I would foresee more business activity in this country, new jobs created, and a level playing field with smaller corporations that can not afford legions of tax advisers and attorneys.
One thing I have to say about corporations is that they are not allowed to run deficits they cannot handle. Money they get to keep is money that gets plowed into real jobs and capital improvements. Money they get to keep is for that economical "rainy day" where they can afford to keep employees during such downturns in the economy.
The Federal Government is different. It sucks up the money and spends it and the benefits are not lasting.
So I'm all for 0% tax rate for corporations. Undercut GE.
A corporation is not a person, it's an organization. All of the people who work for a corporation pay taxes, all of the people who buy products from a corporation pay taxes. All the shareholders pay taxes on income they receive from the corporation (in theory, in practice they've put a lot of loopholes in the tax-code to allow wealthy Americans to avoid paying this tax). Since you're already taxing all the individuals who make up a corporation, it doesn't make since to tax the corporation itself. The effect is the same as if you were to simply raise the taxes on all the individuals in the corporation. Realistically, corporate taxes are talking points that politicians like to throw around when they are discussing unreasonable taxation schemes.
The real problem is all the loopholes that allow wealthy Americans to avoid paying taxes. The solution is not corporate taxes (they don't really make sense) but the solution is to simplify the tax code so that it isn't so easy to circumvent. Politicians like to cite corporate taxes to deflect attention from this truth, as they are often the beneficiaries of such schemes.
so, apparently the administration does support tax cuts for the rich, as long as they are good friends of his who will return some of that support in the form of power and cash.
Corporations are slimy entities. Just because they rely upon the US market doesn't mean they don't take every opportunity to screw it over for their own benefit. They will gladly provide a skeleton staff of local people to facilitate initial sale/installation/whatever needed to extract revenue from wealthier/more willing to spend local people. At the same time, all their support/development/manufacturing/etc investment goes wherever in the globe gives them the lowest cost. And they'll spend a lot of resources figuring out new ways of moving jobs from the skeleton crew to remote workers. They do not want to pay their workers an amount that would make them viable consumers of their product, they want to leech until the host is dried up. I would have great respect for a company doing offshore work in order to actually service the market in that country and not much else, but that never happens.
After that, when the execs and shareholders come to reap the harvest, the hypothetical place where they actually invest somewhat in the US economy through taxation, they dodge the burden at ludicrous scale.
XML is like violence. If it doesn't solve the problem, use more.
I think the Seventeenth Amendment is a bigger problem. When Senators were actually beholden to people that were really engaged with state level politics (the state legislatures), they didn't default to thinking it was a good idea to do everything at the federal level.
A smaller federal government where Senators were functionary representatives of their states instead of politicians? Sounds pretty good to me.
(I don't think that the process of appointing senators would be free of politics or anything, I just think it would be better than the current Senate)
Nerd rage is the funniest rage.
We should all be thrilled about this. The fact is a corporation never pays tax... it just collects it. This is a favorite way politicians love to play the shell game. For a corporation to pay tax, it has to make a profit from sell good and services to consumers. So if the corporation has to pay tax it is really the consumers (You and me) who is paying the tax, the corporation is just collecting it from us. It's a great way to collect tax without anyone realizing it. And on top of it, the very people who don't understand we (the consumers) are paying the tax, we (the consumer) in our ignorance call for that tax to be higher, because the evil corporations are not paying their fair share.
The problem is that corporate tax is the last tax relatively close to the wealthy.
Estate tax, capital gains tax, property tax, import tariffs on products high on the value added scale, export tariffs on products low on the value scale ... of course there are better taxes, but those have already been dismantled (apart from property tax, but because that is local in the US it doesn't serve any redistributive purpose).
They'd still prefer employees living in on site dorms and only getting enough money to pay for the upkeep of their shanty town living relatives though ... which they can get in addition to the tax break elsewhere.
Shipping costs, automation and a university system still producing the cream of the crop of IP producers are about the only thing keeping productive work local in the US. Doesn't help keep working stiffs gainfully employed though.
Small donations from individuals are so rare that it's actually historically relevant that Barak Obama received fully half his 2008 campaign money from small donors, making him one of the first presidents in recent memory actually bought and paid for, at least halfway, by the people. This explains why he has to date kept more than three times the number of campaign promises than he's broken (though he would have been able to keep more of them if Congress didn't, for example, block funding for the closing of Guantanimo) which for an American politician is shockingly true to his word.
Amazing how all that isn't enough to make any sort of significant difference. Obama campaigned on hope and change, but he just ended up proving how broken American politics are.
And, concerning Guantanamo, it doesn't cost anything to just unlock the doors and shut off the lights.
Give me Classic Slashdot or give me death!
This is straight out of a dystopian sci-fi novel, but it's happening in real life. I'd say that counts as nerd-relevant.
"When information is power, privacy is freedom" - Jah-Wren Ryel
Let us see, Obama has taken over GM, is working hand in glove with Goldman Sachs and GE. That sounds just like the Progressives of the early 1900s. Obama has repeatedly expressed the idea that our economy would run better if the government hired experts to "manage" various aspects of it, another idea of the Progressives of the late 1800s and early 1900s. So, yes, Obama is a Progressive. The original Progressives favored central planning of all aspects of the economy. I think it is very easy to make the case that Obama favors central planning of all aspects of the economy.
The truth is that all men having power ought to be mistrusted. James Madison
No-one outside of America (and, I suspect, a whole lot of people inside America) would consider the Democrats to be Left-wing. They're Right-wing, just not so crazy Right-wing as the alternatives.
I see this a lot but often wonder why people think it's legitimate to compare American "left wing" to the world's left wing. It makes no sense. I label this a new fallacy, the Appeal to International fallacy.
Why should anybody be taxed by the US for working outside the US?!? This is ludicrous! Can't the US compete WRT to taxes?!? And if it takes 24,000 pages of tax return for GE to file then the system is horribly broken. Why pay income taxes at all? You do realize that for most of the countries life we didn't have such a free market killing system? The income tax came about only last century.
2 Years? Hah!
He's got a 6 digit ID. Firehose IS relatively new.
Oh, wait. I forgot. This is the NEW slashdot. How does that go?
Oh, yeah.
GTFO AC newfag.
How could I get in on some of this tax-free action?
Richard Hatch
Yes. Actually, I couldn't tell what the real slant was -- the summary praises Reagan (that great tax-raiser?), then quotes a Democrat. The article was five pages long and quoted a bunch of people; I didn't bother trying to figure out who all they're aiming at.
I've seen lots of political stories here, but usually only the really significant ones -- elections, revolutions, disasters, etc. This one stood out as being particularly mundane. I filter out YRO and most of the copyright stories, so maybe this is common elsewhere on the site and I've just missed it. I'm not a fan of politics here because the discussions are usually terrible -- it's like all the other stories except you don't get the two or three people who actually know what they're talking about.
Guess I got outvoted since I've been modded off-topic. :-(
Visit the
Whenever Slashdot updates itself I do everything possible to go back to the old layout, so probably I'm missing a lot of new features. I am at least vaguely familiar with the Firehose, though. Doesn't change my question.
Visit the
I wish people would realize that even if a corporation pays a 35% tax rate, they don't really pay it. Their customers do; in the form of higher prices.
Business operates by generating a profit. When another cost comes in, prices are raised to maintain the same level of profit. Tax is a cost. So every time one of you geniuses screams about a business not paying their fair share, you are really saying that YOU are not paying your fair share.
Taxing more is not the answer. Taxing fairly is.
Losers.that's nothing.I paid 35% in taxes last year.they have a while before they catch up.Im not worried.
You do know that riffing off pithy soundbites does not a genuine argument make? Maybe there's a correlation between wealth and education levels, and maybe, just, maybe, Democrats appeal more to those with education than the ignorance-fomenting Republicans who still enjoy such shibboleths as;
Must question Global Warming
Must oppose Evolution
Must question Obama's birth
When did they become the party of "no truth" ?
Amazing how all that isn't enough to make any sort of significant difference. Obama campaigned on hope and change, but he just ended up proving how broken American politics are.
And, concerning Guantanamo, it doesn't cost anything to just unlock the doors and shut off the lights.
As I've linked above, Obama has kept far more promises than he's broken, and of the ones he's broken the majority of those are because either the Legislature or the Supreme Court has intervened on behalf of the special interests.
And it does in fact cost money to unlock the doors and shut off the lights at Guantanimo. First off you have to do something with the prisoners: either you have to move them to another prison (which only perpetuates the problem) or you have to release them. Congress has forbidden Obama from releasing Guantanimo detainees in the US, and they have largely prevented him from releasing them to other countries. Even worse, Congress has even forbidden Obama from relocating Guantanimo detainees to other prisons; in other words, Congress has basically forbidden Obama from doing anything with the detainees other than keep them at Guantanimo forever.
You set the sales tax rate flatly, and then settle the disproportional tax levy on the annual filing where you can have a simple, clean, discount rate based on reported income.
This is clean, simple, and inevitably fair. It is NOT perfect, but a hell of a lot better than the mess we've got right now.
Poorer folks will pay more in real terms over the course of the year, but they'll get a check back each year from the government to reimburse them. That check could include an inflation calculation, etc... to offset the initial outlay.
You can toy with the idea of setting up sales tax exempt items (such as food), but then you start to make the whole thing more complicated, and prone to manipulation.
I conduct my personal and professional life by the KISS model. I think our government can learn from it.
Opinion:=TMyOpinion.Create(Me);
To be left-wing means to support widespread theft of private property, and leaders of the Democrats support that whole-heartedly. Republican leaders are mixed.
So it's crazy to oppose theft?
Contribute to civilization: ari.aynrand.org/donate
The cost is in lives, as prisoners return to the armies of those determined to kill us.
Contribute to civilization: ari.aynrand.org/donate
But, corporations don't pay taxes. They *can't*.
Taxes are paid by their customers.
The only money corporations have to pay taxes is their customer's money.
When you buy your washing machine for $399 the reason it's $399 is because of no taxes.
If corporations were made to pay taxes the washing machine would cost you $450 or maybe $500.
So you would be paying those taxes at some level.
What do you expect GE to do?
Should Immelt get a job at night to make extra money to pay GE's taxes? Ridiculous.
No, taxes are paid by you and I. Not by corporations.
This is pretty heavy economic theory, huh? But when you think about it, it makes perfect sense.
I'd prefer the washing machine cost $399.
.
The tax system is a mess, but I think the key issue here is innovative accounting. I'm sorry, but accounting is supposed to be, by definition, crystal clear and straightforward. Innovation is this field is more properly described as "accounting in such a way as to hide money we've made while still (maybe) following the rules". Which says to me that the rules are not complete enough.
Unless GE gave every dime of profit they made to charity, they should be paying taxes. A lot of taxes. THIS is why we have a budget deficit.
--The universe will not be altered by forum threads, even those which are very wry. --Tycho Brahe (Penny Arcade)
TFA states that GE has 950 employees dedicated to navigating the tax laws. Think how much productive good those 950 could do if laws were not such that GE is better off employing them in that manner. OUR tax money is being used by people in government to make and enforce laws so that GE employs unproductive people to avoid those laws.
These games are played with humans whose efforts come to no good and make everyone else's lives worse. Wasted lives making waste.
Contribute to civilization: ari.aynrand.org/donate
As I've linked above, Obama has kept far more promises than he's broken
That's the most depressing part of all. Obama can keep most of his campaign promises and STILL have a negligible effect on the course of the country. The take home message from this is: It doesn't matter who you vote for. It doesn't matter what they promise. The rich will keep getting richer, and the poor will keep getting poorer. The justice system will continue to favor the rich and powerful, and your representatives will continue to advance interests other than your own.
Congress has forbidden Obama from releasing Guantanimo detainees in the US
Good thing Guantanamo isn't in the US. Nothing stopping us from saying "Fuck it, they're Castro's problem now."
Give me Classic Slashdot or give me death!
As I've linked above, Obama has kept far more promises than he's broken
That's the most depressing part of all. Obama can keep most of his campaign promises and STILL have a negligible effect on the course of the country. The take home message from this is: It doesn't matter who you vote for. It doesn't matter what they promise. The rich will keep getting richer, and the poor will keep getting poorer. The justice system will continue to favor the rich and powerful, and your representatives will continue to advance interests other than your own.
The take home message is this:
1) The first thing we need to do to allow any possibility of reform in this country is to remove all the Republicans from office.
2) The second thing we need to do to allow any meaningful reform to be passed is to remove many, maybe even most, of the Democrats from office.
3) The third thing we need to do to allow meaningful reform laws to remain in force is to keep 1) and 2) up until Samuel Alito and the rest of the five-member conservative activist bloc of the Supreme Court to die of old age and be replaced by judges who actually plan on following the Constitution and making the world a better place.
Congress has forbidden Obama from releasing Guantanimo detainees in the US
Good thing Guantanamo isn't in the US. Nothing stopping us from saying "Fuck it, they're Castro's problem now."
Oh, yes, really smart move: release some of the most dangerous, radically anti-American masters of asymmetric warfare into an anti-American country a few miles off our Gulf coast. Brilliant idea.
You make it sound as if re-election is a foregone conclusion....
Reelection rates are in the high nineties percentage-wise:
http://www.opensecrets.org/bigpicture/reelect.php
-- IANAL, this isn't legal advice, and definitely isn't legal advice for you. Also, Squee!
No-one outside of America (and, I suspect, a whole lot of people inside America) would consider the Democrats to be Left-wing. They're Right-wing, just not so crazy Right-wing as the alternatives.
Not exactly. Since WW2, most nations have consistently slid to the left side of the political spectrum, embracing various degrees of socialism. So here, in Canada, even our "Conservatives" wouldn't dream of challenging socialised healthcare, social security, government funding for the arts, environment, etc. By the standards of past generations, that would make every party in Canada left-wing. Most first world nations are in a similar situation. So yeah, if you look at the US through the lens of your current society, both of their main parties are "right wing", but if you look at them in a historical context, they're the only ones who actually have a decent balance. And even the Republicans don't generally oppose some forms of socialism (eg. Social Security). If you combined the Libertarians fiscal policies with the Republicans social policies, only then would you have a "real" right-wing party.
YOU IDIOT, CORPORATIONS DO NOT PAY TAXES EVER!
That's nonsense. Do you know why a corporation needs "975 tax accountants?" Think about it for just one minute (hint: they are tax accountants, so maybe it's to help avoid paying taxes). Do you know why corporations register in business friendly countries (used to be Ireland and Cayman Islands, I don't know the hot ones now)? (Hint: it's to avoid paying taxes.) Do you know why corporations place funds in off-shore tax havens? (Hint: tax havens help avoid taxes.) Do you know why corporations and CEOs and board members hire, or send in their own, government officials to change federal and state tax rules? (Hint: it's to avoid paying taxes.) Do you know why corporations and their indoctrinated supporters want to do away with corporate taxes? (Hint: if you need a hint here, you're indoctrinated.)
Corporations are having some of their best years ever, profits are at record highs (this is generalizing, so exceptions apply). Those profits should be taxed and the money returned to public programs and benefits. Corporate executive's salaries are at all time highs, those salaries should be taxed at a high percentage and the money used to benefit workers and people. Shareholder profits are high, those profits should be taxed and the money returned to the public. All of these profits are being taken from the many and given to a few. That's a system that cannot be sustained.
You underestimate the power of government.
The most effective way is to actually enforce the law, and be able to go internationally. Start proving that there is nowhere to hide or run, and establish that it's easier to comply and pay the taxes in the US. If said entities want lower tax rates, they can have them if they pay at the existing rate first. Then agree, in writing, without weasel wording, to not go back on any promises related to any tax cuts.
Tariff the foreign "competitors" until they're at a serious disadvantge, and include every form of business relationship possible to count a company as foreign.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
When they've paid the higher ones first.
Otherwise, the IRS needs to start talking with the various military/intelligence agencies and doing everything to get these companies to do the above. Pay the higher ones first.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Just last night, 60 minutes had a report about companies' use of workers in other countries, and even simply 'moving' the headquarters to another country -- in actuality essentially a mailbox, to avoid taxes.
(BTW, you can get it as an audio podcast, and I think watch it streamed anytime.. but for something like 60 minutes, the audio, esp at 2x on my phone, wins out.. I usually Tivo it as a backup in case the podcast isn't posted, which it has been already.)
And even the Republicans don't generally oppose some forms of socialism (eg. Social Security).
I was generally with you until this point. Last time I recall hearing a lot of noise about social security, it was George W. pushing to have it privatized (plundered). That's pretty much the opposite of socialism. I don't recall the Republican party coming out very strongly against W's proposal.
The hits to 401(k)s and mutual funds alone are bad enough, but imagine if they had indeed privatized the social security system -- just in time for the whole party to tank.
Cheers,
"What in the name of Fats Waller is that?"
"A four-foot prune."
GE does not impose its owners editorial decisions upon its news division like Rupert Murdoch does on fox
There should be no income tax. Only a sales tax on everything bought.
Since the first amount spent is the hardest, consuming all (or more) of the poorest people's income just to survive, necessities should not be taxed. Raw food, used clothing or materials to make it, rent or cost of the cheapest 20% of housing in each zipcode (excluded for everyone in that zipcode), the cost of power and telecom utilities on that 20%, public education, public transit, a national "minimum healthcare standard" - all excluded. Everything else is taxed.
In our $15T GDP, that means probably $12T taxed. Our Federal government should spend something like $3T max, so that's 25%. That would mean no new borrowing. We could cut big, wasteful expenses to pay down our debt. Meanwhile the taxes would decrease our most wasteful consumption.
In the financial economy that has completely taken over our real economy (and crashed it, over and over again), any equity sale that doesn't transfer ownership (50%+1) is taxed at 0.01%. But any sale that finally does transfer ownership is taxed at the full cumulative rate (25%) deferred on all previous transactions. The inhibition on speculation, the stability advantages from coalition control of property among minority owners, and the requirement that finance, so expensive to govern, finally pay its costs to the public, would decrease our most wasteful and risky business activities.
Then there's the advantage to the government collecting taxes from only a much smaller group: sellers. Who already keep more detailed records as part of their business. Who are easier to audit, catch and shut down or fine. Reducing the parasitic accounting industry and the IRS at the top to a tiny fraction. Leaving the effort of "doing your taxes" minimized, saving probably $BILLIONS in simplification alone. Taking back that money from the government withholding that only encourages it to spend money it doesn't have, while preventing us from spending it. And of course the vast privacy invasion run for a century by the IRS would finally end.
National sales tax. It's gotten a bad name from the quacks who make it a totally "flat tax" that cuts deepest to the poorest. But with a few simple tweaks it could be written into law on a single page. And actually fund the country's public activities on a basis that actually makes sense: those getting the most out of the country in undeniable material terms pay the most to keep the country running. And actually fund it enough that we can get out from under the unbearable debt we accumulated under the blatantly failed income tax we experimented with so badly for a century.
--
make install -not war
Er, that would put them in the centre. A little bit of left-wing "socialism" and a little bit of right-wing "free market economy" puts you in the middle, not on one side.
Wow, who would have thought all those Wall Street bankers were lefties !
Krugman's predictions (many others said the same thing) about the insufficient amount of spending in the Recovery Act have proven true, for example. Roubini and Taleb are also worth following, particularly Roubini in my opinion. Robert Reich is sensible. But you seem to be talking about, well obviously actual "headline" writers, but I'm inferring you also mean the CNN etc purveyors of common "wisdom" and announcers of recently released facts such as unemployment, stock market or housing starts data. Absolutely, those airheads are worthless. Expecting useful, accurate information from the corporate media is reasonable in the sense that that is what they owe us, but they're just not competent to deliver a quality news product. And I can't resist saying, the facts of economics are not conservative.
"I can't imagine how things could get any worse!" (some guy) "That could just be failure of imaginatioÂn on your p
And the total for every year is in the ballpark of a billion dollars. I can't find where I've seen it totalled up before, so it's a lot of digging to find all the individual pieces for you and I don't care to spend the time to do it.
No. Being taken on faith is not one of your options.
"I can't imagine how things could get any worse!" (some guy) "That could just be failure of imaginatioÂn on your p
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