Outrage At Microsoft Offshoring Tax In the UK, Google Caught Avoiding US Taxes

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?"

Comments

Re:What's good for the goose...

[Archangel Michael]

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.