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Schmidt On Why Tax Avoidance is Good, Robot Workers, and Google Fiber
Bruce66423 writes "Eric Schmidt said that a £2.5 billion tax avoidance 'is called capitalism' and seems totally unrepentant. He added, 'I am very proud of the structure that we set up. We did it based on the incentives that the governments offered us to operate.' One must admit to being impressed by his honesty." Schmidt also says that if you want a job in the future you'll have to learn to "outrace the robots," and that Google Fiber is the most interesting project they have going.
How many people reading this intentionally pay more tax than they are strictly required to?
I can't fault anyone for taking advantage of legal loopholes.
If you want to blame someone go after the Sociopaths in Washington(TM) who created the U.S. tax code.
Please. Someone go after them.
Its not Capitalism, its "Mobile Capital"-ism. And governments need to adjust their tax structure very quickly! Otherwise national-level and smaller businesses will not be able to compete.
SURELY NOT!!!!!
I'm sure you could write a computer program to do a better job than 99% of CEOs... and think of all the money that will be saved on the obscene costs in have a human CEO.
Run Eric, Run. The robots are coming.
The more Schmidt speaks the less you can take the do no evil line seriously.
Why would it be a good thing for us to work really hard so we can keep jobs by outpacing robot workers?
The goal should be 0% involuntary employment.
If video games influenced behavior the Pac Man generation would be eating pills and running away from their problems.
The corporate tax rate should be on the order of 10% *but* with zero loopholes: Any profits from sales made in the U.S. get taxed regardless of where the company is based.
That would actually increase taxes on some major companies (but not to the stupid levels for the nominal tax rates that are in place now).
What we have now is a system where politicians can strut around talking about "taxing those evil corporations" while the corporations that pander to the politicians pay zero tax. Offender Number 1: General Electric that was paying zero taxes while Jeffrey Immelt was jetting around the world with Obama at taxpayer expense while the convenient liberals at MSNBC railed that Mitt Romney never paid taxes while conveniently never talking about their own corporate masters.
AntiFA: An abbreviation for Anti First Amendment.
First on tax avoidance: no one wants to pay taxes, but if everyone is taxed fairly, then this sort of nonsense resulting from favoritism in the tax code would not happen.
On the robot overlords commeth comment: Just about any halfway intelligent person can see that we're entering the phase of robot factories that produce products and that can repair themselves. Even factories producing robots.... These factories will take orders of magnitude fewer labor hours, and this movement will spread to other typically high labor industries, such as agriculture. Once those are converted, what then? A service economy can only employ so many, and food and basic foodstuff will wind up being almost free, other than energy costs (which could also be virtually free in this scenario) So what's left? Academia will only hold so many, and you only need so many managers/troubleshooters.
The cesspool just got a check and balance.
You are using the structure made available with tax and you get a free ride. but i do not accuse the user of tax avoidance, I accuse the government responsible for setting up the tax and letting the whole gaping hole, and never being bothered a second that some big company seems to never have tax report in the same level as their profit. *THEY* , the politician , have a lot to explain. not the company using it.
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Most people will never make it to higher education. It is never mentioned but the educational system works by setting up a threshold on people, not on knowledge. The 20% (or whatever) with the best mathematical skills get to be engineers or scientists. Exams are designed to filter that 20%.
In the US, people with some college is 56.86% of the population, as per wikipedia. The rest of the people are doing jobs that are being automated now or will be automated during the next decade. For example, drivers (self driving cars), factory people (robots), call center (the web and call center speech recognition), and many more. At some point robots will be flipping burgers, it is not that difficult.
We don't have time to educate all this people and create paid jobs for them before the next wave of technology comes around in another ten years. When it comes, it will take away even more jobs.
So we have two choices. We own the robots collectively as a society, or a few rich people owns them. The way things are going, it seems to be the former. This could bring a dystopia if we don't find a way out.
So here is my proposal.
Right now governments get most of their money from labor taxes, but soon this money will dry out. We should stop taxing human labor completely. We are penalizing it. Instead we should tax corporate earnings and financial transactions. That is where all the tax money need to come from. That would keep worthy humans productive even if their marginal value compared to robots is small.
We need to come to terms with the fact that a big and growing proportion of people will not be employed. They should not be considered guilty. In any case they should be considered owners of the automated workforce the same as the rest of people is. So they should be given a cut of the taxes so they can live meaningful lives.
When his defense asked, "Which computer has Jon Johansen trespassed upon?" the answer was: "His own."
my ass.
Exactly. And the summary says: "One must admit to being impressed by his honesty."
Why should anyone be impressed by his "honesty"? (Tax avoidance is, in my book, inherently dishonest, even if legal.) At least the CEOs that decline to comment show some level of guilt. If Schmidt can stand up and say that, it shows him up as self-entitled, sociopathic, or both.
Got them moderator blues I blieve I walk out the do', With these mod-points I been gettin', I 'most never post no mo'
"I can't fault anyone for taking advantage of legal loopholes."
Who do you mean by 'sociopaths'?
When those with piles of money (not just corporations) lobby Congress for special protection for their industry, or loopholes that benefit them, or for subsidies for their industry, or advantage over others that comes as a result of their influence, that ordinary people and businesses do not have it is wrong. The congress-critters that vote on the laws are only part of the problem.
Of course he should be proud, he worked the system to maximize revenue. If people are pissed off at how much tax they pay, change the laws. Either make their foreign operations taxable, or make it harder for them to shift operations out of the country.
I can't blame them for wanting to pay most of their taxes in a country with the lowest rate, hell the cayman islands does very well enabling that.
I'll probably be stamped as a communist, but here goes...
It used to be a sci-fi fantasy, but robots replacing humans in jobs has invariably started to become a reality. I'm not mad at the robots, they're just machines, but one has to face the fact that less jobs = more poverty in this overpopulated (in relation to jobs) world of ours.
Question is: What do we do? Here is an exhaustive list of possible solutions/scenarios:
- Let things continue this way. Result: Over time everybody will loose their jobs, and a few super-wealthy people will control everything.
- Destroy the robots. Result: More jobs for everyone, a lot less efficient production-process, more waste, more pollution.
- Kill surplus humans. Result: Less unemployment, but kinda evil.
- Equally share the produce of robots. Result: Everybody gets a piece of the cake, though the few will have to contend with less cake than in the other scenarios for the sake of the many.
Those are the possible futures driven to the extreme, and the future WILL be one of these or a mix thereof because use of robots WILL continue to increase. So pick your poison. Personally I'd rather be accused of communism/socialism than suffer any of the 3 other options.
I do not think that we should repentant for us wanting him to bleed.
Not robots in the scifi sense, but rather every bit of automation we've installed for the last 150 years. We've gotten so efficient by using automation that, quite simply, we don't need as many people to do things as we have in the past.
It was speculated in the 60s and 70s that our work weeks would drop to 5-10 hours with all the time savings from computers. We've saved all that time, but an hour of human work is still the same value and nobody want's to get paid 25% of a normal annual salary (say, $15,000 a year), so we simply produce more with fewer staff.
Is it just my observation, or are there way too many stupid people in the world?
just another sign of it. Why should we outrace robots to survive just because we lost the vagina lottery? I keep hearing these conservatives spout off about how it'll never get that bad because they rich need us to buy their crap. That's the stupidest thing I've seen since the guy with the 'Keep the govmmit out of my medicare!' sign. Jeez, it's right there in you're economics -> Over supply of labor + shortage of Goods means the goods get more profitable to sell and cheaper to make. Notice how Apple computer is the most profitable company in history?
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Profits are easy: They get reported every quarter for the stockholders. If the CEO wants to cheat on taxes by lying and saying that the company lost money or didn't make a large profit, then he'll get skinned alive by the stock market. The reporting puts checks in place to prevent a company from claiming that it made no money.
AntiFA: An abbreviation for Anti First Amendment.
*THEY* , the politician , have a lot to explain. not the company using it.
Yes, exactly. It's been quite a while since my US tax days so my examples are dated by a couple of decades and are US centric, but the point still holds.
Anyway, there are still plenty of tax breaks for drilling for oil. So, many that you can write off more than you invested in the drilling operation - that's right, the US taxpayer subsidies oil drilling. Why? Because Congress (expecially back in the 70's ) was scared shitless about not having domestic oil supplies. Mix in industry lobbying and BINGO! A sweet tax loophole.
Contrary to general opinion, big industry just can't walk into the legislature and say, "Give us a big honking tax loophole or else!" Politicians aren't that stupid.
But if they can give a big tax break to basically buy votes, then they'll do that too - see all the local tax breaks municipalities and states give to lure businesses locally. This allowed the politicians to say, "Look! I brought JOBS to the area! Re-elect me!"
The home owner deduction in the States is also a policy thing - get more people to own homes because it's believed that home ownership strengthens communities. It also makes workforces less mobile, but that's a different post.
Anyway, tax policy is the carrot when politicians don't or can't use a stick. Tax loopholes are also a way to get industry on board with restrictions on their business.
There's a whole lot more to this, obviously, but there's a point of view.
That hurts jobs and is part of the over use of contractors.
with contractors you have more overhead / things are slower to fix.
Are you telling me you don't take any deductions or credits? No standard deduction? Do you pay a use tax in your state for all the online purchases you made and did not pay sales tax on? That's not even legal, yet most of us do it to avoid taxes. Every company should avoid paying every dime of taxes they can. It's the only defense we have against government growth short of a revolution.
Yes it's an anecdote! Were you expecting original research in a Slashdot comment?
we need more trades / apprenticeships educational system.
The tech site does need them not just years of the old educational system.
and someone has to fix / install / do up keep work on the robots. For call centers yes some auto tools work but you still need some one to fix the errors and if anything people locked in to a script can't help what can a BOT do if the script does not fix it?
"Schmidt also says that if you want a job in the future you'll have to learn to “outrace the robots,” " This is why I tell people that leftist parties are the future. Once robots have taken all jobs, people will vote for leftist parties, because the problem of who's going to do the hard work (the problem capitalism solves) will have being solved. An I am no leftard. I just face the facts.
The only reason it's not good for the USA is because we are one of those high tax nations. If we lower taxes, businesses will want to keep money here and we'll be on the winning side of things while all the rich people leave Europe.
Yes it's an anecdote! Were you expecting original research in a Slashdot comment?
It's a common problem among liberals...
Yes it's an anecdote! Were you expecting original research in a Slashdot comment?
Don't blame the fox for breaking into the chicken coop and feasting on your hens. Blame the one who was supposed to keep him out.
The fox only follows his nature and goes by the ancient rule of minimal input for maximal output, and so do companies. And while a company certainly has no "instincts", it does have its "natural rules": Maximize your profits. If you LET them avoid tax, they WILL avoid tax. And, bluntly, they would be incredibly stupid if they didn't.
Don't blame companies for using tax loopholes. Blame your politicians for being stupid enough to create them (and I only write "stupid" because first I can't prove otherwise and second, don't attribute to malice what can sufficiently be explained with incompetence).
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
The only legitimate purpose of a tax is to raise revenue. One can argue the level of revenues any governmental organization needs and the services one expects from the government but it is, in my opinion, improper for the government to attempt to modify societal behavior through the use of financial incentives and disincentives. It is because of this attempt at modifying behavior that we have the disasters we call tax policy and tax law.
Those who claim that Google, or anyone or anything else, is immoral for avoiding tax doesn't understand the tax code. The tax code is overly complicated and typically works along the following lines:
- How much did you bring in last year?
- Did you pay a mortgage? O.K., you should deduct x amount from your taxes because we want to encourage mortgages because we want to encourage home ownership.
- Did you invest in new equipment for your company? O.K., you should deduct x amount from your taxes because we want to encourage investment in new equipment.
- Continue, in the U.S. at least, for another 30 or 40 thousand pages of rules like this.
Those of you who claim "tax avoidance" is immoral are saying that companies and individuals should skip reading through those rules and applying the rules to their situation. You are claiming that people should not accept the incentives that society has put in place for providing what society has asked of you. Those of you who claim that moving business structures from one locality to another in order to benefit the business owners are really arguing against global competition.
If there's an income tax then everyone with income should pay it.
If there's a property tax then everyone with property should pay it.
If there's a sale's tax then everyone who buys something should pay it.
Stop using the tax code to modify behavior and you'll stop the contortions companies and individuals go through to minimize the amount of tax they pay.
A big part of the problem is that in many countries (especially the US) the tax system is so broken that it has created enormous incentives to look for loopholes. Some commenters have noted that they pay more than they actually have to because they don't pay some accountant to go find all the ways to reduce it. Exactly! This is a shortcut way of saying that the cost exceeds the benefit. For a corporation, that is not the case, in part because corporations are taxed to death, so there is a large incentive to reduce their tax burden. It's that simple.
I really don't understand the attitude of some people on here who are outraged by companies taking advantage of legal ways to reduce taxes. If there is a legal way for a company to reduce its tax burden, it's naive to be upset that companies use it. Direct the outrage towards the bought congresspeople, if anyone, but really it should be funneled into fixing the actual problem: the government takes way too much.
In the US, the government taxes over a /third/ of all of a company's profits (http://en.wikipedia.org/wiki/Corporate_tax_in_the_United_States) at a bare minimum. That alone is a staggering amount of money. But that's before the money even makes it to any of the owners, who are also taxed. By many estimations, the total tax on people is *half* of gross income (http://www.nowandfutures.com/taxes.html - just one example, there are many).
Half! That's absurd! A government provides many services and I'm happy to pay my fair share for those services, but IMO half is far in excess of what is reasonable - the government does some nice things, but in no way is what it provides worth what it costs. What is fair and reasonable? Honestly, even low double digits seems to be pushing the limit of reasonable, but I'd jump at the chance to have the government take "only" a fifth of my total income.
So, if my total tax is in the neighborhood of 50%, and fair is at most 10%, but I'd settle for 20%, then if I discover some *legal* way to get that 50 closer to 20, will I take advantage of it? Absolutely! It's not unethical at all. I'm *already* paying an unethical amount of my total income, so reducing my tax to something closer to fair is something I'm happy to do.
Until real tax reform happens and people and companies are taxed reasonably, there will always be huge incentives to find every possible means of reducing one's tax burden.
And how much of whatever you make do the robots workers we need to "outpace" buy? Usually I hate boycotts of products (or movies\TV shows) but this guy has it coming....
From what orifice did they pull that number from? Giving a number of how much tax has been "avoided" means that there is a number of how many taxes SHOULD HAVE been paid. Where did you get that number from?
Paying your due taxes is the very definition of legal - and obviously all those schemes were legal. You obviously could throw the book at them if they were paying a penny less than they should, which they didn't do.
So if you compare the tax they pay to the tax they have to pay, the difference is going to be zero! Zero does not equal 2.5 billion. In whatever currency.
Some author might have made up tax scenarious where the due tax would have been 2.5 billion GBP higher (if they were an all american company, an all british company, no offices abroad, even perhaps an if the cayman islands weren't a tax haven) - but they are what they are - what if scenarios.
So much for the legal aspect. We could discuss the moral aspect and the fact that there are specific loopholes for big international companies that aren't open to SMB or the ordinary taxpayer. That's definitly not fair, but what really makes me sick if the same politicans, whose job would be to create a fair tax code, now start to complain when companies play by those very unapt rules!
So if someone thinks that gogle *should* pay 2.5 billions more, create a tax code that MAKES THEM.
bickerdyke
This isn't just about deductions and credits though. Its about moving your money to subsidiaries in countries where no actual business is taking place and cooking the books in such a way that you practically avoid paying any tax at all on billions of dollars in profit.
ER costs the most and you should be able to see a doctor long before that even if they can't pay.
Are you telling me you don't take any deductions or credits? No standard deduction? Do you pay a use tax in your state for all the online purchases you made and did not pay sales tax on?
Are you telling me you're not aware that there's a world outside your borders?
In my country, I get tax deducted automatically from my salary. My "sales tax" is applied automatically, and if I buy mail order from another member state of the European Union, I pay their equivalent tax. If I import from outwith the EU, customs check my package and bill me for the import duty. Some companies will lie on the customs label and I don't get charged, or sometimes the customs themselves don't bother (presumably because they're too busy to process everything fully and restrict themselves to high-value items. No, I don't go back to customs to correct the mistake. I've never even checked whether it's possible to do so. But I never seek to find a loophole to avoid the duty.
Is accepting other people's errors as a little bonus equivalent to what Google is doing? No. If I was to set myself up a corporation in a tax haven then quit my job and take up a job as a remote worker for my new corporation and contract myself back to my former employer, that would be equivalent to what Google is doing.
And that, dear boy, would be illegal. As a worker, I am obliged to pay taxes in the country I am resident and working in. I live here, I work here, I pay tax here.
Google is not a Bermudan company. They are based in Mountain View, California. Google does not do its work in Bermuda -- they have major datacentres and development offices all over the world, and next to no physical footprint in Bermuda.
Every company should avoid paying every dime of taxes they can. It's the only defense we have against government growth short of a revolution.
"Government growth"?!? Government worldwide is already shrinking, and it's the lack of proper regulatory oversight that caused the global financial crisis. That may not seem to be the case in America, where government regulation appeared to precipitate the crisis, but the reason that they wanted to force the banks to give more high-risk loans was an attempt to "shrink" government by eliminating the need for benefit schemes for low-income households. Meanwhile, in the rest of the world, our banks were allowed to invest people's money in these crazy US debts because the governments didn't want to "interfere in the market". And one of the few countries that did regulate, Spain, was screwed over anyway, because of their national reliance on foreign debt (holiday-home mortgages).
Spain has been forced into "austerity measures" that essentially mandate the "small government" philosophy, and guess what? There's a revolution forming against it, because the jobless want to somewhere to live, and something to eat, and some help getting the skills they need to work, and the private sector doesn't gain any profit from such charity....
Got them moderator blues I blieve I walk out the do', With these mod-points I been gettin', I 'most never post no mo'
Capitalism + Plutocracy is what he really means.
Government of the people, by the rich, for the richest.
Sheesh, evil *and* a jerk. -- Jade
If the corps aren't expected to pay the taxes in the first place, why muddy up the system with wasted effort? Either a tax should be paid or shouldn't be paid. Not paying it should be tax evasion.
People who don't earn as much can take advantage of various credits and services, and oftentimes don't out of a sense of pride or fairness.
I view your argument as splitting hairs in a way that's entirely irrelevant; anyone can take advantage of government rules, and not everyone does.
I'm not rich, but I pay zero income tax, since I'm living in a country with zero income tax. It does have its downside too though.
Excuse me, but please get off my Pennisetum Clandestinum, eh!
I don't bother to find out about the available deductions. I don't mind paying some more taxes - that money also ends up benefiting me and others, I don't care I don't directly control how.
They're not abusing it. You said yourself that individuals are expected to take deductions and such. Companies are expected to follow the rules as well and try to reduce their tax bill. I think he's being deliberate in the delivery of his message. Yes it's arrogant, yes it's unfair, but he doesn't come off as smug (IMHO). He's illustrating a point, and so long as the "fix" for the "problem" doesn't penalize Google specifically I think he'll be fine with it.
They're playing by the rules and illustrating the problem. But unlike the Warren Buffet approach, he's not advocating for change - 'cause you know when Buffet does that people say "well feel free to pay more taxes" which to simple minds makes him seem stupid. I applaud Google for being very upfront and honest about the problem.
Again. These companies are under no legal, moral or ethical constraint to assume the maximum tax burden possible.
They're under fiduciary constraints to maximize their shareholders' investments.
If you think that the current tax avoidance schemes are a Bad Thing, stop pissing and moaning at the companies who are simply doing what they're supposed to be doing and change the fucking laws.
Chas - The one, the only.
THANK GOD!!!
As long as the tax code is complex, it will favor those with the resources to exploit the complexity.
The fundamental problem is not that the tax code is complex (though I agree that is a problem) but rather that it is really, really difficult to define income in such a way that it closes all potential loopholes. It's even more difficult to do so in a way that is politically possible, especially considering the influence corporate concerns have with elected officials. I understand what you are saying but I'm actually a certified accountant and I can tell you that eliminating loopholes in the tax code is MUCH more difficult to achieve than most people realize.
My personal opinion is that we should eliminate the corporate tax rate, removing the shenanigans altogether. Make up for this by making dividends and capital gains taxable as income.
Umm, then companies will stop paying dividends and companies can avoid paying taxes by avoiding realizing capital gains. Both are fairly easy to accomplish. You also haven't considered the effects of national and state boundaries. A lot of tax avoidance strategies are based upon exploiting differences in tax codes in different countries, states and/or municipalities.
Seems to me that if corporations manage to mostly avoid paying taxes, the arguments about "Double Taxation" for dividends and capital gains don't hold water. Just eliminate the corporate tax altogether, which would level the playing field for smaller businesses that can't afford to send their income through offices in Ireland and treat all income as the same no matter what the source. Do that, eliminate the alternate minimum tax and institute a federal sales tax if there are still shortfalls. The only reason this is hard is because Congress is so busy sucking the cocks of all the special interests out there. It's hard to cast a vote when you have a cock in your mouth. I know I often say I don't come to your job and knock the cock out of your mouth, but that's what we need to do for our Congressmen! Less cock, more tax reform!
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
No. If you answer yes, you have a sense of ethics.
How much extra did you pay on YOUR taxes last year that you did not have to pay? Or are you a hypocrite that thinks others should pay more but you aren't willing to back up your talk with action.
Paying taxes that you don't have to doesn't make you an ethical person, though it might mean you are rather stupid or at least naive. Not paying taxes you don't have to doesn't make you an un-ethical person.
and "tax avoidance" is a completely unfair term. The tax code is written with the assumption that taxpayers will take all legally permissible deductions and credits. If you take an allowed deduction, that's not a "loophole", and it's not "tax avoidance", it's just following the rules as THEY set them up.
Paradoxically, the more the laws are refined to "close loopholes", the more opportunities it creates for taxpayers to take advantage of the ripple effects caused by those very changes. Like a dog chasing its own tail, changes to the tax code begat yet more changes, and only the rich and powerful eventually can afford to truly leverage all the opportunities.
Simpler tax schemes such as a flat rate on retail sales are much, much more difficult to game. We could dispense with most tax accounting entirely with a simple, broad approach, but this is America. As the Brits know well, we can usually be counted on to do the right thing, but only after all the other alternatives have been tried and discarded.
"We receive as friendly that which agrees with, we resist with dislike that which opposes us" - Faraday
Doing so in secret may be, but doing it and then standing up and talking about it shines a light on the problem. Can't you just feel all the other CEOs who use these practices just raging about this and wanting Google to STFU? Consider it a government sponsored (through tax loopholes) advertisement for changing the system. Then does it look immoral?
Restraint is not merely legal. Restraint is about your own internal compass. If you prove not to have one, I will hold that against you.
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
Not. If. There. Were. A. Simple. Flat. Tax. That. Applied. Across. The. Board.
There is no such thing as a simple flat tax. You can have a flat tax but it won't be simple. The problem isn't in defining the rate. The problem is in defining what income is. Most of the complexity in the tax code that is not loopholes or subsidies is in defining what income actually is. It's a shockingly complex problem. I'm a certified accountant and I'm telling you that a flat tax rate does NOTHING to reduce the scope of the problem and simply creates new and different problems.
If the end game is a world where the robots do everything and people can just relax and do their hobbies, there will be a painful transition. Imagine 80 percent unemployment - not because the people aren't educated enough but because they're unnecessary. Adjusting the population level doesn't seem like an answer because you've still got to have extreme skills to be useful during the transition. Then there's the greed factor - how can things function when nobody has to actually do anything? What's the mechanism for allocating resources? What determines how many personal robot servants each person gets? I'm all for this world of 0% involuntary employment, but there are issue with such a world and there are even bigger issues in the transition to such a world.
Again.
You can say "Again" if you wish, but it does not mean you are reiterating the same point. Perhaps you should read the post I was replying to and what I wrote, rather than going on an unrelated rant.
I was pointing out that the GP's assertion that:
You shouldn't be angry at X for following the laws
has no rational basis in general.
Allow me to illustrate using your own example:
If you think that the current tax avoidance schemes are a Bad Thing, stop pissing and moaning at the companies who are simply doing what they're supposed to be doing and change the fucking laws.
If I wasn't angry about them following the law and avoiding the tax, then what rational reason would I have for wanting the law changed? Thankfully, I realise that not being angry is silly and instead can petition my MP (you do realise that I have no power to change the fucking law, right?). Fortunately, the MPs seem to be taking notice and this has been buzzing around the commons for the last week or so.
SJW n. One who posts facts.
Quite.
This is what I don't get. There are so many people on these threads are essentially saying any behaviour, no matter how bad is fine if you can get away with it. And furthermore, the rest of us should just accept it.
I cannot comprehend what lack of a moral compass would lead one in that direction.
SJW n. One who posts facts.
So if someone was standing on the street corner with a bag of money and they said "whosoever approaches while hopping on one foot gets $1000 cash", would you do it? Or would you say "someone else needs the money" and ignore him?
Should I not claim the mortgage interest deduction and the child tax credit? The original idea behind tax credits/deductions is for the government to encourage desirable behavior. You can't cry foul when you say "People who do X will get money!" and then people do X and take the money. If you don't want to give them money, stop providing the hoops to be jumped through. But then don't complain when they stop jumping.
This month's Forbes also claims "Job Growth is Overrated" - because apparently all those unemployed people are going to flock to buy more-efficiently-produced products with the paychecks they're not receiving. And chortles that "Suckers are beneficial to society. They cover the overhead".
Speaking as someone in the UK who does run his own business and therefore can do those things you described, I would like to point out that the situation is not nearly as one-sided as you are suggesting.
For a start, you can only do those things if you are not considered an employee. You can't just decide to call yourself a contractor and magically opt out of the normal tax/NI system when you're still doing a regular job for an employer. People used to try and do this, but with the introduction of the IR35 rules a decade or so ago, HMRC (the tax authority in the UK) can go after people who are merely "disguised employees" to get the missing tax income back.
Moreover, for those of us who really are running our own businesses rather than being someone else's employee, anything we save through not making the same payments as a typical full-time employee is usually far outweighed by what we lose because no-one pays us for time off, we have to provide our own equipment and training, we're responsible for paying all the basic bills like heating/lighting/phone/Internet, and so on.
There are certainly some great perks to running your own small business against being an employee. In a very real sense, you get to control your own destiny. You can be much more flexible with when and how you work, and fit paying the rent around your lifestyle rather than the other way around. I think our education and employment systems don't do enough to promote alternative careers to those who might enjoy and benefit from them.
But mysteriously saving a fortune in tax isn't a good reason to go down this path, and if that's the only reason someone is doing it then they're going to be sadly disappointed. Contractors often do make more money than their employed counterparts, but contrary to the impression given by certain mainstream media outlets, the real financial benefits don't come from dodging a bit of NI, they come from having much more flexibility to negotiate what you're paid based on the value you actually generate for customers/clients rather than being stuck with a market value salary where your employer keeps most of the profits in return for the guaranteed wage. Of course, you also bear all the risk if your client cancels the contract at 24 hours' notice and you still have rent to pay, etc, so it's not for everyone. And at the risk of stating the obvious, when you make more money, you're also paying more tax on the income one way or another, so having highly skilled contractors commanding relatively high rates of pay a big win for government tax revenues overall.
As a final data point, just to put the "contractors outside PAYE are just dodging tax" meme to bed, a real tax accountant was interviewed by a major news outlet recently and asked to calculate how much tax an individual earning a fairly high income of (IIRC) £200,000 per year would pay as an employee vs. as a freelancer using typical alternative arrangements. It turned out that this person would actually pay slightly more in tax than their employed counterpart, and the whole thing is only a net loss to the taxman because the employer isn't paying NI either. So, when the BBC or government departments or whoever got caught paying highly compensated people via these arrangements, it wasn't actually the (non-)employees who were benefitting.
If you disagree, post your argument. (-1, Overrated) isn't your personal censorship tool for views you don't like.
Again. These companies are under no legal, moral or ethical constraint to assume the maximum tax burden possible.
They're under fiduciary constraints to maximize their shareholders' investments.
If you think that the current tax avoidance schemes are a Bad Thing, stop pissing and moaning at the companies who are simply doing what they're supposed to be doing and change the fucking laws.
Not. this again. The board is required to act in the best interests of the corporation entrusted to them by their shareholders. This notion that they are legally required to should maximize profits/stock price (shareholders' investments) is incorrect. If Google wanted to open a school or fund education so they can have a better workforce tomorrow, the board cannot be removed (well, except by a vote - but that can happen irrespective of what the board does). The board can claim that they are acting in the best interests of the company (long term interests).
On the other hand, the CEO generally owns shares in the company as well, so losing out on profits would impact their personal wealth. So there is a selfish reason to 'maximize profits'. But there seems to be this general idea that if the company behaves like a douche for profits it is okay because they have a legal duty to shareholders is simply not true.
Comment removed based on user account deletion
This is not about corporations making full use of tax credits.
This is about corporations licensing "IP" e.g. the name "Google" from some company in the Bahamas for almost as much money as they make (before the licensing) in a country such as the UK. As a result they appear to make no UK profit (since they have to pay so much for the name "Google") and hence have to pay no tax.
Basically it's about moving all actual profit offshore before it's taxed.
It might be legal, but it is unethical and it looks like lawmakers are looking to fix that loophole.
And FYI, that is something it is possible to do as an individual. Most people don't and those that do are generally looked on as scum.
SJW n. One who posts facts.
Bruce66423 is clearly "unrepentant" in his reporting by using the word "unrepentant" as though Schmidt has committed a crime. Just as with most socialists, he is wrong in thinking there is some moral law that supersedes actual law and that only socialists get to define what it is. Schmidt A) followed the law and B) met his obligation to the stockholders who foot the bill for Google to exist and expect to make something from taking the risk in investing and that most likely includes the socialists' precious pension funds.
A corporation's modern purpose for existence is to serve its shareholders and employees. Money unites them when heterogeneous visions of society do not. If it is fulfilling its purpose, then it can die happy.
An internal compass is the property of the individual, not a group. This becomes more obvious when you work and live with people different than yourself.
That being said, a man who manages to enchant a corporation and grant it a moral compass (by virtue of being its CEO and guiding it with his own) deserves kudos for his high feat. It is a difficult form of sorcery. Then again, look at Chick-Fil-A. Clearly your mileage may vary!
No matter what a corporation pays, they just pass the expense on to the consumer.
The only time corporate tax works is when it taxes a company who's primary income is in another nation. How often does that happen?
In the end, there's only one true income source to tax, and that's citizens. You can tax them on what they own, what they make, and what they do. That's it. Everything else is juggling accounts so it's harder to tell it's all coming out of the same wallet.
you still gave them 8k plus an interest free loan of 2k
But is it noticeably better than the 0.01% APY that a Chase savings account pays?
I always thought that "do no evil" was a bit weak. A mining company could say "well we only maimed. 10 employees today, but no one killed.... that's not really evil is it?" A better policy would be "don't be a dick".
So we have Google, which started in a government funded university using a network with initially designed and funded by the government to make piles of money, that refuses to give back to the government in way of taxes. Maybe not evil, but definitely dick-ish.
When Google does it, it's capitalism. When Bane Capital did it, it was EVIL and wrong.
Double standards in this world never cease to amaze me.
www.slightlycrewed.com - Because aren't we all?
If interest rates (prices) were set on a free market with a hard currency it would be based on how much money people had saved (supply) and how much people wanted to borrow (demand). This works out nicely because any automation involves a large expenditure of money to increase productivity. If there is low unemployment and people have high wages and money saved it will lead to low interest rates. This causes businesses to want to invest in capital equipment because labor is expensive and money is cheap. On the other hand if you have high unemployment, low wages, and low savings you will have a high interest rate. This leads businesses to hire people because it's more profitable. This is a natural balance of sustainable automation.
What we have now is the Federal Reserve setting artificially low interest rates. This causes businesses to invest in automation at a time in which we have high unemployment, low wages, and low savings. This is exactly the wrong approach. It causes lots of malinvestment by automating production to increase capacity but nobody has enough money to buy these goods.
I love Jesus, except for his foreign policy.
"change the fucking laws."
Congress tries doing that but corporations lobby against changing the very tax laws corporations helped create!
Moron.
Restraint is not merely legal. Restraint is about your own internal compass. If you prove not to have one, I will hold that against you.
His investors, however, will find other, more lucrative investments, insulated as they are from the moral dilemmas involved, separated by their 401k that holds mutual funds that buy indexes that own company stocks.
Wait, wait, wait . . . Don't get me wrong. I am not endorsing a "profit above all else" viewpoint or unethical behavior. But someone else here will assume I will. Someone always does when I point out the dangers of laissez-faire capitalism. Like if I yelled "Black widow" when one was crawling up his arm he'd figure I was rooting for the spider. I've been accused of endorsing genocide when I advocate legal restraint of corporations.
But anyway, insufficiently legally restrained capitalism selects for those who can put profit over all else. An employee can refuse to do something he believes is unethical, assuming he even knows how the product of his labor will eventually be used. Maybe he quits. Maybe the boss finds someone else to do it. Maybe he convinces the boss. Then maybe the boss tells his boss, quitting, convincing or being replaced, etc. up the line. Maybe company management can be convinced, but the board is unhappy with the CXO's for poor performance. Maybe they too quit in protest, or get replaced. Maybe they convince the board to do the right thing. But if another company can do something legal but perhaps more anti-social, and their stock goes up and yours goes down, the investors may revolt and change the board. Or maybe they just sell their stock and buy something more profitable -- by the time you get to the investor, you're quite a few degrees removed from any moral or ethical dilemma. But just maybe the board sells the stockholders on taking the high road. But still they get out-competed by the company with less restraint. Stock prices drop, and the ethical investors now have less money and less influence compared to other investors who just looked for the best gains/dividends/performance.
So a company just can't be a moral entity. And it's not because the people that work for it and manage it aren't. A company is more than the sum of its employees. It's more than just its investors. It is an entity created by our laws and our desire to thrive. As such, the only moral control that can be imposed to level the playing field so that companies don't grossly abuse the people, the environment and everything that matters is to have effective laws so that the less ethical don't out-compete the more so.
And I'll say again: I am not endorsing amoral behavior. I am pointing out that a corporation -- and corporations in general -- are amoral by design, all the best behavior of the people involved be damned. It is up to us to have law that "designs" the restraint into the system. I am not endorsing amoral behavior. Again, I am not endorsing amoral behavior.
To sum it up, we need more than just one guy to "hold it against" a given corporation. I don't shop at WalMart*. Perhaps you've heard of my protest? No? Ya, nobody else, either. If it's just you or just me, nothing we do individually will matter. We need to get together with the rest of the citizenry and as the GP suggested: "change the fucking laws." Not that we can't piss and moan, though. I'm willing to endorse changing the law while still pissing and moaning. In fact, asking for change can sound exactly like pissing and moaning, but i'm gonna take that risk.
I am not a crackpot.
If Schmidt was really a capitalist, there would be some nice dividend checks to the stockholders. Instead of maintaining the lifestyles of executives, the money would be best not going to tax havens. Stockholders should stand up and fire executives with real capitalists who put the money in the pockets of stock holders.
That's a really good explanation of what's going on, so thanks, but I disagree with your conclusion.
Most people don't do this as an individual because most people don't make enough money for it to be worthwhile. But let me explain why I don't have any ill-will at all towards these companies: it's a global economy, and countries have to compete for businesses. If they U.S. can't offer a competitive tax structure (I personally favor a corporate tax rate of zero*), then the companies move. It's the free market at it's best, and it happens even between states in the U.S., and I completely support it.
* - Where do companies get their money to pay taxes? Hint: it's not growing on the trees that are growing outside their offices. Studies indicate that an average of 21% of the cost of all the goods and services you buy in the U.S. are simply embedded taxes that get passed up the line to the government. Most businesses get their money from one source: their customers.
Stupid sexy Flanders.
"change the fucking laws." Congress tries doing that but corporations lobby against changing the very tax laws corporations helped create! Moron.
But you still blame the companies and the lobbyists instead of the people taking their legal bribes? That's asinine. Abolish lobbyists. The best way is to implement a tax system that can't be gamed by continuously changing and rewriting the laws to favor special interests. How about not giving tax favors to any company by eliminating corporate taxes altogether? I mean, where do corporations get the money they use to pay taxes anyway? Studies show an average 21% of the price of all goods and services are due to embedded taxes. Eliminate corporate taxes and see that people start off-shoring to the U.S. instead of from it. The best indicator of government revenue is GDP - if your ultimate goal is more government revenue, the best way is to increase GDP; what happens companies move operations here in order to take advantage of low or zero corporate taxes?
Stupid sexy Flanders.
Stanislaw Lem, EDEN, ... A crew of six crash-land on Eden, fourth planet from another sun. They set forth into a strange world that grows ever stranger. The sun is not completely circular. The desert ground is soft, spongy, it exudes acrid vapors. Thickets of plants are shaped like hanging spiders; trees, violet and blue, breathe noisily; flower petals lift into the air like a flock of startled pigeons. The men come to a wall that moves in rhythmic waves; they enter an automated factory where mysterious objects are created, destroyed, and created again in a meaningless cycle.
Final state after the problem that robots do not buy was not properly fixed.
CC.
TaijiQuan (Huang, 5 loosenings)
Most people don't do this as an individual because most people don't make enough money for it to be worthwhile.
It's not hard to set up an offshore corporation to get paid into, and it's not that expensive. I think there are two barriers to entry. It takes time, effort and money to figure it out, and to get paid that way. It also feels wrong. I think either one alone probably wouldn't be enough: if it was trivial, people would do it anyway. But given the difficulties, and bad feelings encountered when you start the relatively long process that is enough to put most people off.
Interestingly the UK government closed one of the tax avoidance loopholes a while back (google IR35 if you're interested). If you look like a duck^W employee and quack like an employee then you are one and the company must pay national insurance no matter if you are a contractor or real employee.
and countries have to compete for businesses.
I disagree that it works like that:
If they U.S. can't offer a competitive tax structure (I personally favor a corporate tax rate of zero*), then the companies move.
The thing is that companies aren't going to move. The US economy is the biggest in the world. No company is going to simply leave and refuse to do business there, because there is so much money.
What companied are doing is moving a notional HQ to somewhere else.
The HQ doesn't do anything, doesn't produce anything and doesn't rely on the resources of the Cayman Islands. They still do business in the US and still make use of the resources.
I personally favor a corporate tax rate of zero*
I'd be happier with that if all dividends were charged at the same rate as income tac + national insurance + employers top up contribution to NI.
It could make sense if all money leaving corporations and ending up with people got taxed at the same rate.
Of course, another reason to have a corporate tax is to stop a corporation hoarding money. That may or may not be a good idea.
SJW n. One who posts facts.
But you still blame the companies and the lobbyists instead of the people taking their legal bribes?
Who is to say that the blame doesn't get shared among the all? Why must it be either/or?
Eliminate corporate taxes and see that people start off-shoring to the U.S. instead of from it.
Corporate tax comes after profit. The reason people won't inshore is because the cost of living in the US is high and there are stricter environmental regulations compared to some other reasons. The cost of those two will make any endavour more expensive.
SJW n. One who posts facts.
Google has an obligation to maximize its profits. It has some wiggle room in areas like working conditions, but it can't just leave billions in taxes on the table.
Also, a lot of the money we're talking about is retirement funds and savings; the more Google pays to the government, the less Google's stockholders get, and that includes most of us.
If companies take Schmidt's word seriously, unemployment is going to skyrocket as workers are replaced with robots. Yes, you still need technicians and engineers, but you only need maybe two of each per few robotic units so the cost is outweighed by profit. Instead of paying a hundred workers $15/hour (Not exact, just throwing out a number) which equates to $1500/hour to the exec. Instead, have a hundred robots with maybe ten engineers and five technicians average about $23/hour, which comes out to $325/hour.
The moment that workers are out on their ass because of robots will be when I start taking a hammer and destroying them. Recession? No. Great Depression? Not even close. It will be a literal capitalist nightmare where there's the rich, then people with no home, job, money, or even a hope of seeing anything.
I'm glad someone's finally standing up for those poor overtaxed companies, when will they finally be free of the ignominy of paying their fair share?
If you think someone isn't free to have a different definition of "freedom" you may be a tyrant.
Profits are easy: They get reported every quarter for the stockholders. If the CEO wants to cheat on taxes by lying and saying that the company lost money or didn't make a large profit, then he'll get skinned alive by the stock market.
Want to make a wager on that? Profits are incredibly easy to manipulate. You seem to be under the impression that financial statements are not malleable and cannot be manipulated. I'm an accountant and I can tell you that financial statements are far easier to manipulate than most people would believe. It is shockingly easy for a company to make lots of money and show it on the P&L but conveniently non of the profits came from US operations and thus no taxes need be paid.
Where do the corporations get their money from?
Stupid sexy Flanders.
This sounds like Atlas Shrugged.
I've a healthy small business. We don't avoid taxes.
maybe i would consider answering you if you were capable of constructing an analogy actually analogous with what we are talking about
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
An idiotic question, what kind of corporation? It's a very broad term. You might as well ask where cars get their parts from.
If you think someone isn't free to have a different definition of "freedom" you may be a tyrant.
people will judge an organization if it defiles the society it is supposed to be a part of. that hurts the bottom line
the previous observation nullifies your comment
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
* - Where do companies get their money to pay taxes? Hint: it's not growing on the trees that are growing outside their offices.
I take it you've never heard of orchards.
there is no endless universe of morally repugnant corporations untouched by human judgment
especially since bad corporate behavior will eventually hurt the bottom line, and therefore the investor
if someone says to you "this moral behavior is too expensive, i'm looking for a better return, i'm taking my money, good bye" then let that investor go. because that is a soon-to-be poor investor
the idea that a moral company has to be immoral to compete doesn't follow
because the immoral companies will suffer financially as a consequence of their behavior, and therefore represent worst investments, not better
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
That's repugnant.
Enlightenment is the elimination of that which is unnecessary.
This is a circular argument. They only are required to pay less because they lobbied to do so. Previously they were required to pay more.
When you cant win, ad hominem.
How many people reading this intentionally pay more tax than they are strictly required to?
A more apposite question would be how many people reading this have set up offshore shell companies solely for the purpose of avoiding tax, or have the resources to do so? Comparing a company like Google to an individual is absurd sophistry on the level of taxation.
The problem here is not whether companies should volunteer to pay more taxes, but the fact that global corporations have found ways to avoid the jurisdiction of any one country (or indeed, of any country at all), and are able to funnel their revenue through complicated structures in various countries which mean they pay virtually no taxes. This is similar to hollywood accounting, borderline fraudulent, and bears no relation to the tax affairs of most individual taxpayers.
That they would avoid all tax was not part of the bargain made with countries who let companies incorporate and set up business in their country, with all the protections and privileges that a limited company implies. This is a relatively recent phenomenon, and you can expect countries to find new ways of taxing companies if they insist on trying to evade corporation tax. For example countries could impose a tax on all transactions, a tax on all revenue (before profit/loss calculations), a tax on advertising, etc. This might not suit companies like Google, and they'd probably find it worse than corporation tax, but when companies like Google boast about avoiding paying any tax at all, that's what they should expect in response.
Tax is the price we pay for civilisation, and companies should not be able to escape paying their due to the country that hosts them.
Yep. Modern capitalism: under no legal moral or ethical contraints - let's leave it at that.
The S&L scandal, which according to the media was 30% white collar crime. Enron. The current depression. Yup, not under any constraints at all... and too big to go to jail.
mark "or is there something this non-Xian is missing about morality?"
and his stupidity the Tory party does have an anti American wing (they blame Winston and Roosevelt for the loss of the empire) and don't forget the Uk is not like the USA the PM has a lot of power he can call up the house of commons business mangers and have a new tax avoidance bill on the order paper in a couple of days and with a 3 line whip it can be rammed through to law very quickly. And labor and teh Lib Dems wont say much and the Press are going to be having a field day monstering Google's CEO and board.
. Hell Cameron would probably get a 5% boost in the polls the way the UK population feels about these immoral tax avoidance schemes
If every tax-avoiding individual/corporation posted a YouTube video flaunting all of the wealth they retained from legal tax avoidance, this might actually provoke a reaction from voters and a response from politicians. Intentional overpayment by any one entity (even Google) will not make any difference to public finances, and will only mollify the public and discourage reform. If Schmidt is in favor US tax reform, he is doing a great job. Now he just needs to get this story on the Google News front page, but good luck cracking that algorithm.
I've read a lot of comments here about whether tax avoidance is ethical or not. I have an analogy that I think sums it up. Assume that a child tax credit law was written poorly (intentionally or not) to allow the full tax credit for any children under your care on 12:00 am January 1. Now suppose as an individual paying taxes, you could go into an orphanage and adopt a couple of children at 11:59 pm on December 31, and then cancel the adoption at 12:01. Let's suppose you even give the kids a piece of candy for their trouble. The orphanages agree to this, as it reduces their candy budget requirements. You then claim the full tax deduction. Is this ethical?
Individuals select a bullet list of policies (i.e. drug war), they support on their tax return and are willing to pay their share to support the policy. To put their money where their mouth is so to speak, by way of paying taxes per policy by a percentage calc. The law is written that if not enough citizens support the policy, and therefore don't provide enough funding, the policy expires and the law is repealed.
I'm tired of paying for taxes on policies I don't support and never had a say in. And I'm tired of politicians passing laws I never asked for.
Actually it's very simple - all companies have customers, whether that customer is another company or people or the government.
Stupid sexy Flanders.
Technically those are assets, not money. That's an important distinction because the asset is only of value if you find someone that will barter for it, and that is where money enters the picture. Money is simply a way of passing value around between random strangers.
If all work is done more productive by robots than by humans, then a lot of humans will be jobless and unable to buy all those products. Furthermore, todays humas would feel unwanted and start to lose their humanity and degenerate. If they are not fed, they will become violent. The only option would to do things robots are not good at. However, not all people can work as programmers, nurses, doctors, researchers, managers/analysts/etc and craftsman. Things which cannot be automated, as they are either too unstandardized, require creativity, total egoism or empathy.
The present system is not able to handle such situation. Outpacing will not work for long, as the robots would become more profitable over time, lowering the potential income level for workers. If the workers cannot life from their work anymore, they die, require state subsidies or get the food and housing through other channels, e.g., steeling it from the rich.
All the wags writing 'if you don't like the tax laws, have them changed' - as if we, the great unwashed, can get the same access and one on one time with our 'elected' officials just like the rich pigs do.
After exiting the polling both, 99% of politicians wouldn't fucking care if we died in a fire; we're not their boss.
Agreed 100%
"It is easier to bitch about bad laws then to make good laws."
I would ignore him, yet that is a personal choice and irrelevant to anything.
How can I do that? By voting? So who should I vote for? The people who give most or those who give the greatest amount to the rich who bought the politicians?
And I would be happy if they stopped jumping. All they do is blocking that corner, so people are unable to cross the street.
Don't fight for your country, if your country does not fight for you.
So the high tax rate of 21% in Belgium is not that crazy after all. Who knew?
Don't fight for your country, if your country does not fight for you.
Income for financial reporting and income for tax purposes are defined differently, and can result in very large difference.
Financial reporting follows GAAP in the US, while tax filings follow the IRC definitions.
Also, the stock market doesn't always care about net income. Because of silly accounting contrivances, financial analysts tend to back those accounting adjustments out to come up with their own measurement metrics, or even just work from the cash flow statement since that will blow past accounting nonsense and get right to the reality of how the company is doing in terms of cash-in/cash-out during the year.
There are a lot of differences between book income and tax income, and each of those differences were put into place for what was deemed to be a "good reason" at the time. For example, certain kinds of asset exchanges getting recognized in accounting, but not in tax because you can end up taxing people who haven't gotten any cash in the exchange, and would be forced to liquidate holdings in a bad market just to pay taxes. Or accounting (with some exception) pegging asset expenses to the concept of "useful lives" which is just an approximation specific to each company, but tax just lays out specified asset life categories, and recognizes annual expenses faster, so that companies can recognize their expenses up front and pay less taxes as a result, because legislators want to reward companies that invest and buy assets, by allowing them to take the expense on those assets earlier and pay less tax.
IAACPA
If you feel that you are poor and living paycheck to paycheck, perhaps you should cut out broadband. That should help pay for your gas.
In case of fire, do not use elevator. Use water!
Shut up, lobby or leave. Really? In a free society, you insist we can't speak out ("whine" you call it)? No freedom of speech for us!
If there is a "contract" with the government that requires we pay taxes under threat of severe penalties, what is government required to do? Are they required to respect our hard earned money by being as frugal as possible and very careful how they spend it? Gee they don't do that. Are they required to avoid "vote buying"? Waste? Boondoggles? Bad programs? Earmarks? Spending that favors their "big supporters"? Nope to all that.
If this is a "contract" why is the government under no obligation to do anything?
You'd bleat that they maintain the "infrastructure". Have you actually looked around? Vote buying, boondoggles and favors to their "big supporters" take precedence over all that.
Your instructions are to shut up and pay up, it's "in the contract". Wow! The government likes your attitude.
But what if your compass and mine simply point in different directions?
Alice may think taxes are great because they fund schools and roads. etc.
Bob may think they are terrible because they enable murders around the world in the form of military actions, and the oppression of his fellow countrymen
Alice's moral compass says she should not only pay taxes, but if she can, should pay extra. Its a good thing.
Bobs compass says no, he should pay as little as he can to avoid being victimized himself, and try to hide and not pay as much as possible.
Both of them have a moral compass, they just don't agree. Take another example...even a more normal one...
Carol thinks Social welfare programs are great. They keep food on families tables and allow their children to grow and be educated, even if they would otherwise be starving.
Dave thinks social welfare problems are terrible. Sure they may help individuals in the short term, in the long term it just breeds dependancy and an ever increasing and unsustainable cycle that will eventually lead to total ruin for the entire economy.
Each has a moral compass, each believes that his way is the way that will lead to the best outcome longterm.
The immoral thing, in my eyes, is forcing them all to pay in to the same system regardless of whether they think what its doing is good or not. The idea that we are all united is just a lie. Its not true, we don't even agree with eachother.
"I opened my eyes, and everything went dark again"
I keep a lot of my money in CDs at another bank that pays more. But CDs typically require a longer-term investment than the 1 to 11 months that money withheld from paychecks waits between when it is earned and when the excess tax is refunded. So what are these short-term investments that pay substantial interest?
The fiber project has to be one heck of a cool project to work on. Would love to be a part of that one. Heck, I was downsized on Monday so out of work so if you are listening Google, I am officially available.
Speaking out falls under the heading of "Lobby", so no, I wasn't attempting to discard or restrict your freedom of speech.
Yes, there is an implicit contract. You'll notice that the roads are drivable, the water drinkable, etc. The government (which, I remind you, is a collection of your fellow citizens, and is not in fact staffed by aliens or demons) is beholden to us. We elect them, and we can un-elect them. Is the system perfect? No, but no system is.
Is there some alternative political system you'd like to propose? If so, then please tell us all about it.
wants to be the first monkey to touch the monolith
Here is the problem.
When we think of capital gains tax we think of Mitt Romney and Wall Street traders who make fortunes for stealing wealth and not producing. What we do not see is grandmas, widows, responsible savers, and even yourself in 30 years. If you live past 60 you will want to retire and where will your income come from?
The answer is capital gains. You get taxed all your life saving and trying to do the right thing and sacrificing keeping up with the Jones only to be taxed again? How is that fair?
Why do we pay taxes? It is fundamentally to pay for public goods that the free market can not provide unless forced too such as schools, roads, military, police, etc. Does Google benefit from this? LIKE HELL YES. It uses public municipalities for its fiber. It uses military and free trade to work in new markets. It uses the education system more than regular employers as they require IQ tests for all employees. These folks got trained on the public dime.
So why shouldn't corps pay taxes too if they also utilize the public goods as much as the private man?
Yes we hate all taxes and they are annoying but just like any bill it is something you pay at the end of every month. Hate cell phone and insurance bills? Try taking the bus to work and not using one? It is the price you pay to live civilly.
http://saveie6.com/
"The current crop of GOP senators", are trying to get rid of the very loopholes Google uses. Remember flat tax, fair tax, 9-9-9? The GOP position is that the tax code should be simple, so people can't finagle as much. It's Obama who insists on keeping the special exemptions and loopholes so he can pick the winners and losers, while raising rates on the people who actually report the money they earn. Pick up any newspaper, their positions are clear - GOP says "close loopholes and special interest deductions", Obama "no, taise tax rates".
* - Where do companies get their money to pay taxes? Hint: it's not growing on the trees that are growing outside their offices.
I take it you've never heard of orchards.
They grow money trees?
I need to plant one of those!
First off you can't clone yourself in another country as a clone you and just tell your employer to send it your cloned self.
We can't for example buy a mailbox in New Jersey while our apartment is in New York and claim to be New Jersey residents. Right?
A corp can do just this. By these cloned shells.
In essence we can't get no taxes unless your employer agrees to pay in just shares and dividends on an offshore account. The IRS will be on them in a millisecond! They have computer programs to detect this. So if an employer is paying you a stub will show the IRS how much you make and you shall pay that amount! There is no way around this as long as they pay you cash you are then taxed.
It is totally unfair. Maximizing shareholder value yadda yadda. What about my value? The tax laws favor the rich extremely in this country.
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Hate the game!
Seriously, if you are allowed to do it, then fine. However one has to ask WHY is it that they are allowed to do it? Corporate corruption of political folks and greed.
One of these days if something doesn't change there will be a recoking, and all the imaginary numbers in a magic box won't help you then.
Best way to opt out. Take your economic activity underground and simultaneously apply for every benefit you can.
That way you both starve the beast and bleed it.
John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
Tax avoidance is not 'bad'.
Most illegal things are not 'bad', just illegal.
If you want us to stop thinking anything you can get away with is fine then someone (you or anyone) needs to align illegal with immoral/unethical.
John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
Ok, since a corporation has decided to act outside national boundaries, let's treat it like it.
Send bills for using publicly funded infrastructure.
Disallow participating in the political process.
Be bombed at your own expenses
Police will not patrol your front lawn. Better hire your own security.
Don't expect a bailout if going gets tough.
Lawmakers not taking you into account? Tough. You decided to not have any part in this.
All you can get is wanking Ayn Randers giving you a parade with the usual result of a pearl necklace.
Paying your employees is not the same as paying taxes. Your employees paying taxes doesn't magically make your national duties vanish.
20 minutes into the future
I've never seen a good explanation for why a corporate entity should pay a lower tax rate than a personal entity when they both have essentially the same property rights. Sure, corporations aren't eligible for Medicare or Welfare but they receive subsidies and bailouts instead. Either get rid of all taxes or tax all taxable entities in accordance with their consumption of public goods. Corporations probably consume most of the federal budget spent on legislative actions and civil courts and judges, for instance. Most of the budget of the patent and trademark office and the copyright registrar. A significant portion of law enforcement investigates civil and criminal Copyright infringement for corporate entities. The roads are used significantly by transportation for corporate entities. Why shouldn't corporations have to pay for those obvious benefits of government?
This guy would be a great example of one of the few good ways of using all of those terrorism laws the US has been passing. Lock him up without a trial or contacts with the outside world for a few decades. It would be perfectly legal after all, so he'd be OK with it.
The former is invariably the outcome of any large-scale involvement of organised capital; democracy will end up being usurped by corporate power, as has been seen time and time again, and as is the case right now.
tl;dr, plutocracy is the conclusion of capitalism
Well the contract isn't truly forced on you. You (well at least most people) don't pay taxes in your childhood. By the time you're expected to start earning money (and thus paying taxes) you're perfectly capable of leaving the country. So by staying you implicitly agree to the contract. Or you could decide to not abide by the contract, but in that case the rest of society (represented by the government) is also not obligated to abide by them - so why shouldn't they throw you in jail? With no social contract might makes right, just like with all other species on the planet.
they don't need you to buy their goods. If the top 1% already claim ownership over or most property in the world (which they're gradually doing, they're somewhere between 50% and 80% in the states) then why do they need you? They don't even have to bother selling you anything, because you don't have anything they want. They don't need your labor (there's already too much of that going around), you own nothing (because they own everything in this scenario). They don't need you.
Moreover, the quality of their lives is enriched by your poverty. People worship and idolize the rich. How does this make them feel? Good? Really good? What would it be like to live a life where you never have a conflict that isn't instantly and effortlessly resolved because you have so much wealth people fall over themselves to do as you say? That's what people mean when they say they want power. The want the ability to do as they please without consequences. For themselves anyway.
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The alternative to a strong, well funded state is like you pointed out, Somalia, or, if they want a closer example, Mexico. The town in central Mexico were my grandmother lives is in such level of lawlessness that since 3 years ago I can't visit her without a significant risk for my life. Some people in USA really don't have a clue of how nice they have their life there. Why they think that people want to live and work in USA so badly to die trying? The strong institutions of the USA are the source of their prosperity, not the unlimited self interest.
Mexico: 100% conservative's America now!
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Wrong. A massive amount of tax goes to pay the bankers who loan the government money. It is, by definition, impossible to pay back all of the money owed, creating the national debt.
I come here for the love
I expect everyone else to pay taxes, yes, that includes churches and corporations.
I also expect our Government to be more responsible and it appears I don't get any of what I expect.
Be seeing you...
Again. These companies are under no legal, moral or ethical constraint to assume the maximum tax burden possible.
Maybe not legal, but a moral and ethical constraint certainly they have. There is a reason why big, new and prosperous companies like Google can exist and are created in western countries and not in Sahara Africa, because a knowledge economy can only be created in a educated, stable, lawful and relatively prosperous society.
Mexico: 100% conservative's America now!
dave doesn't understand he owes everything to being a part of society, despite whatever delusions make him believe he is an island
but it doesn't matter what i think of dave. i can demonstrate a society based on dave's principles would descend into misery and poverty except for a handful of ultrabillionaires, and carol's society would be a strong society of free equals, freed from the cruelties of survival that society can easily fund to dissipate, and reap great rewards for that
and then i can force dave to pay his fair share, based on this realization. just because someone is stupid and doesn't see what is necessary for civilization to exist, doesn't mean they get to freeload on the rest of us by not paying their fair share. and i'm certainly not going to let the shrill clueless idiots take over our government and destroy our great country
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
The answer is capital gains.
Only because of the tax structure. Part of the reason I bought a house was to take advantage of the zero capital gains and the mortgage deduction. I might have put my money into a different type of investment otherwise. Sure, when I'm old and start selling off assets, I will have to pay capital gains. Thing is, most old people aren't rich. The vast majority are paying less than 25% on their federal taxes. And if it really seems like it will be a big problem, we can grandfather people with existing property, have income limits, or take other steps to ease the burden.
Does Google benefit from this? LIKE HELL YES.
"Google" is a piece of paper. The people who benefit from the schools, roads, military, police, etc. are the employees and stockholders of Google. Tax them.
So why shouldn't corps pay taxes too if they also utilize the public goods as much as the private man?
I have a couple of reasons:
1. Pragmatism. We have these incredibly powerful instruments called corporations, and they have corrupted our political system to the extent that they barely pay any taxes. I contend that this flaw is inherent, so just go back to taxing people and let the huge accounting nightmare that is corporate taxes just die.
2. Onshore that offshore money. Maybe even attract money from other countries.
3. End "corporate welfare". Without "tax incentives", politicians have one less tool to abuse.
4. End howls of "double taxation" that keep the dividend tax rate low.
W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
"Companies get their money from customers" - gfxguy
Is that some sort of primary school answer? What we are discussing is the fact that many of these of companies in fact own hundreds of others companies and pay themselves repeatedly in unscrupulous attempts to evade tax.
If that's what passes for informed debate from you you should really get out more.
If you think someone isn't free to have a different definition of "freedom" you may be a tyrant.
On the other hand, the CEO, owner, and everybody else is just as likely to own put-options on the company. They then become pressurized to put run their companies into the ground. They are also likely to have no vested interest in the company at all.
testing out my trending skills
I was referring to mjr167's claim that overwithholding followed by a tax refund is equivalent to giving a 1- to 11-month interest-free loan to the government. In order to provide a viable alternative to this loan, an investment would also have to have a term of 1 to 11 months. The best short-term investment one can make is to pay down credit card bills unless one already pays in full each month and just has the cards for rewards (such as myself). So what short-term investment do you recommend?
> dave doesn't understand he owes everything to being a part of society, despite whatever delusions
> make him believe he is an island
So you start right off making assumptions about what else dave might think? Seems like you are accusing him of being dishonest with his intentions. He is an imaginary guy so theres no reason he can't be a dishonest one, but, if you want to bring that dimension in we should consider dishonest carols too....but I don't see how that informs the point at hand.
Are you honestly saying that there is no room for differing opinion on the matter? My point is, two people can honestly want whats best, but have diametrically opposite ideas as to what is best. You say dave needs to contribute, but you are not willing to take into account that what you want him to contribute too...he might see as actually harmfull and not helpful, even harming the very people you want to help?
Is there really no room for people to have genuiinely disagreeing opinions?
Frankly, I think you just proved my point... there is no We, because people aren't even willing to consider that disagreement is genuine, just that anyone who disagrees has some sort of selfish/ignorant motive.
The problem is...its clear to you that Dave and Carol's policies will have those outcomes. Its not clear to everyone, and not even clear that all possible real implementations of those policies are all going to lead to positive outcomes.
Your argument seems to be that you see what outcome you believe certain generic policies will have is clear, so anyone who claims otherwise is a liar. Ive argued with too many "conservatives" to believe that.
"I opened my eyes, and everything went dark again"
If you don't make the loan, though, you can treat it like the rest of your cash flows and invest it accordingly, including some into long-term investments.
In the United States, individual income tax refunds arrive during the second quarter. Some people have planned expenses in the second quarter that they plan to pay using their tax refund. In order to make an investment that substantially beats the short-term interest-free loan to the government that is the status quo yet continues to meet the use case of second quarter expenses, the money would have to be earned and invested throughout the year and withdrawn in the second quarter. So what investment should one use between the day when one doesn't make the loan and the day in the second quarter, less than 12 months ahead, when the expenses come due?
The money doesn't disappear from your bank account after you file your return.
I agree.
You don't stop gaining interest on it.
I disagree. You stop gaining meaningful interest on it from the moment it lands in your bank account. Remember what I told you about Chase savings accounts: they pay 0.01% APY.
Thus if you have to discourage something, you should discourage consumption (sales), not production (profit, income).
Why aren't these necessarily equal?
Tax avoidance is good for the same reason you peel off leeches when they attach themselves to you. Who the hell wants to get sucked dry by parasites?
Liberty in your lifetime
It could make sense if all money leaving corporations and ending up with people got taxed at the same rate.
I agree, provided you allow businesses to consider the dividend an expense.
The problem is that a public company is owned by the shareholders. A dollar earned by the company is a dollar earned by the shareholders, and you'll see that reflected in the value of the shares owned by the shareholder. Corporate dividends are paid out of profits. The corporation has already paid an income tax on those profits. It's essentially transferring money from the shareholders to the shareholders, so why should it be taxed a second time? Salaries paid from the corporate to its employees are considered an expense, and only taxed once. Why do dividends deserve the extra tax?
So you're now bitching because the process for rectifying what you see as a problem is non-trivial and not handed to you on a silver platter.
Boo hoo.
This is reality. Nothing worthwhile is EVER going to be "easy".
Chas - The one, the only.
THANK GOD!!!
As I've said elsewhere. Don't bitch to me because the road to your utopia isn't a flat, paved road with clear and concise signage and rest stops at short intervals.
Nothing "good" in this life is going to ever be easy. You need to work for it. Start working for your own dream.
Chas - The one, the only.
THANK GOD!!!
Again. I didn't say the situation didn't need to change.
And I make no pretense that such changes are going to come "easily".
But if you expect it to happen without a LOT of PERSONAL effort on EVERYONE'S part (including YOURS), you may as well be bitching about the coaching of a football game.
Chas - The one, the only.
THANK GOD!!!
No. No they're not.
A corporation, by its very nature is an amoral entity.
The problem is that our current laws ALLOW this sort of thing.
If you dislike this, work to change the laws. Don't simply sit back and bitch because they're following the current (bad) laws.
Chas - The one, the only.
THANK GOD!!!
You guys are making out like Company A and B can continuously pay each other and never have to pay taxes; at some point their money has to come from legitimate customers, whether it's final sales or from other companies - who pass those expenses on to their customers. Ultimately it all comes down to what we pay in embedded taxes - the more hoops it jumps through, the higher the percentage of embedded taxes.
Stupid sexy Flanders.