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.

Comments

Question

[Man On Pink Corner]

How many people reading this intentionally pay more tax than they are strictly required to?

Re:Question

[erroneus]

This is spot on. No one would.

Here's the problem: Those laws/rules/loopholes/allowances etc were created by the money influences which are benefiting from them.

So if tax policy were a naturally occurring thing, I would say "yes, let's take advantage of our knowledge and understanding of nature!" But it's not and these tax avoidance structures haven't always been there.

The government did not change the rules without cause. Find the cause and you will find the culprits.

Did Google help to create the rules? Not likely... the rules were in place, most likely, before Google rose to power.

The 'news' and subsequent inquiries seem to want to focus on the tax [non-]payers. Ostensibly to determine if they did anything 'illegal.' I'm willing to bet they have not done anything illegal. The real problem and where the focus should be is on the law.

Re:Question

[Anonymous Coward]

And how many people setup offshore bank accounts and front companies etc to avoid tax?

Re:Question

[MacTO]

If I had to venture a guess: most of us. Very few individuals have the money to find those legal loopholes or lobby governments for tax incentives. Even if we did, the return on investment would be in the red.

Re:Question

[DJRumpy]

I disagree. I think they are focusing on exactly that; abuse of the tax system. The current crop of GOP senators are very business friendly, and money plays a larger role in politics than in any time in the past. I can understand why Google takes this approach, but to appear unapologetic is just rubbing salt in the wounds.

Take individuals for instance. They get a very specific set of deductions, and are expected to take them. Because of the special interests and years of corruption in congress, we have businesses making billions in profit, and paying almost nothing in taxes. It may be legal, but it doesn't make it right. The system is geared to give every benefit to a business, and none to middle America.

What they are highlighting is not the fact that is illegal (it's not), but rather that it's unfair, which it is.

Re:Question

[CrimsonAvenger]

Here's the problem: Those laws/rules/loopholes/allowances etc were created by the money influences which are benefiting from them.

Hmm, so the "money influences" decided that the average taxpayer needed a "standard deduction", right?

Or a deduction for mortgage interest paid?

Or, at various State levels a "homestead exemption" to Property Taxes?

Just a few of the more obvious examples of LEGAL reductions in tax rates for the "average person". There are more, if you want to bother looking them up. Your tax software will even ask you about them when you get around to doing your income tax return(s)....

Re:Question

[N1AK]

Believe it or not it is possible to believe the system should be changed and still take advantage of the system as it is. But then given you're happy to throw generalisations like that around I doubt anything other than a black and white view of issues appeals to you.

Re:Question

[dywolf]

Yes, but a rich asshole.
And you didn't answer the question.
You own a company. A company that is sposed to make you money.

Would you spend two point five BILLION pounds (so ~FIVE BILLION dollars) in taxes that you don't have to?

Yes or no.

If you answer yes, you're an idiot and will probably be replaced by your board of directors within an hour.

Re:Question

[MightyYar]

Why pick on the GOP? They are certainly not alone. The Democrat's current position is focused on "rates", which is clearly anti-reform. As long as the tax code is complex, it will favor those with the resources to exploit the complexity.

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.

Re:Question

[Instine]

me. I do. I could play all kinds of games to get out of the 40% rate I pay on half my salary. But I'd rather the NHS got it, than a private healthcare system I sponsored with my avoided spend on tax. Because thats better for me? No. Because that's better for the country I live in and the the one my daughter will grow up in? Yes.

Re:Question

[dywolf]

Really? So he should be quiet about successfully increasing the bottom line to the tune of 5 BILLION dollars?
He has a company. He has one job to do, precisely one responsibility to his board of directors and shareholders (and himself).

That responsibilty: To make money.

To spend 5 billion bucks he doesn't have to would be stupid in the extreme.
When you're on the outside looking in, you dont have to like it.
But stand in his shoes for one second, and tell me you would do differently.

Re:Question

[DJRumpy]

The GOP has always been representative of Business. It simply is what it is.

Re:Question

[w_dragon]

More like these tax loopholes are bugs in the law where companies can set up in multiple countries, properly follow the laws in each country, and pay very little tax anywhere. I suppose you could blame the GATT for encouraging this sort of globalization, thought personally I think globalization's benefits far outweigh its drawbacks. At this point the government has the choice of negotiating with the countries that provide the tax havens (Ireland, Bahamas, etc) to change their tax laws to close the loophole, or moving the tax burden from corporations to individuals who don't make enough money to make that sort of tax setup worthwhile. Or they could ignore it, keep pretending that there's political will to cut spending to balance the budget and scream about how it's the other guy's fault that the debt keeps ticking up.

Re:Question

[kenh]

Home Schooling & Private schools are, apparently, unheard of by you.

Very few hospitals are run by municipalities, most are run by either non-profits or charities, with a some being for-profit.

The public roads argument is interesting - do employers pay for roads so employees can get to work and so that they can ship and receive goods, or do employees pay for roads so they can get to work and buy the goods others have manufactured/raised/offer? The answer is both.

The original poster's point, which apparently escaped you, is that no one goes out of their way to OVERPAY their taxes, and someone who pays all their taxes as defined by the law (as Google does) is doing nothing wrong. It may not comport to a simplistic view that "they should pay more" but in reality, they are simply availing themselves of the incentives our lawmakers provided them.

Don't be angry with Google for following laws that allow them to pay less in taxes than you think they should, be angry at the lawmakers that craft the laws that allow them to do so.

Re:Question

[Xest]

I do actually. As do most of the UK's population.

I live and work in the UK, and I take my pay through PAYE which means my income tax is automatically deducted. Most employees in the UK get paid this way.

I, and many others have the option of being paid outside the PAYE system so that we can manage our own taxes, this would allow us to take advantage of many tax evasions schemes available, or even simply do it ourselves by paying ourselves the minimum non-taxable wage and paying the rest out in a manner that doesn't attract things like national insurance.

Some people do do this, but most don't.

So can we now finally kill this stupid "How many people reading this intentionally pay more tax than they are strictly required to?" meme? Because certainly in the UK, the answer is "most people".

Re:Question

[fuzzyfuzzyfungus]

How many people reading this intentionally pay more tax than they are strictly required to?

How many people reading this have any significant ability to adjust their 'nothing we did was other than legal' tax rate to be substantially different from their 'time to fill out the tax forms' tax rate?

That's the thing: complaints about corporate and HNW tax-dodging are not based on the premise that everybody should just voluntarily chip in an extra 10% for Uncle Sam; but on the (largely accurate) perception that there is a little-people tax code and a quite distinct, and very, very generous indeed, tax code for people who can afford the requisite caymans subsidiary, 'tax opinion letters', and suitably talented accountants.

It's like answering a complaint about criminal justice for poor schmucks with overworked public defenders vs. celebrities with fancy lawyers by asking "Well, did you go and voluntarily turn yourself in and plead guilty for all that jaywalking you've done?". That's orthogonal to the point: The complaint is not "some people aren't volunteering!" but "some people are forced, and some people would only be held to anything resembling what the rest are forced to if they were to volunteer."

Re:Question

[__aaltlg1547]

No, yes and no. There are influences other than big money at work too.

The mortgage interest deduction is a subsidy to banks and the home building industry. You may believe you benefit from it. I believe it simply makes you pay more for a house.

Re:Question

[kenh]

And anti-slavery, pro-Civil Rights.

So am I to understand that Democrats are thus "Anti-Business"? That would explain a lot of their actions...

Re:Question

[penix1]

Don't be angry with Google for following laws that allow them to pay less in taxes than you think they should, be angry at the lawmakers that craft the laws that allow them to do so.

There is plenty of anger for them both and then some. Your argument is specious because those same corporations are buying those same politicians specifically to favor them with laws written by the corporation lobbyists. Of course the tax system favors them since they wrote the tax loopholes this dumb ass CEO is espousing as virtuous.

Re:Question

[DJRumpy]

The two are not mutually exclusive. A tax system can fund government and be fair. Ours currently is not. If the loopholes that these corporations exploit were closed and the government didn't have to close the gap by taxing middle America at a higher rate, much of our weak middle class economy issues would disappear.

Re:Question

[jellomizer]

How much of that money is really going to Public Roads, Schools, and Hospitals...
Most of what you mentioned is paid via Town Taxes that is based on the value of your property, not income.

Hospitals are funded for the most part privately outside of direct taxes, with the exception of Medicare and Medicaid, and Random Grants and often Bad Dept protection.

The real question is the effectiveness of the services performed and the amount that you pay for it.
Is the amount we put into welfare good in keeping people off the streets and giving them a helping hand to get past some hard times in life, or is it a disincentive for them to change life, because they are getting everything they need without having to work for it? Why isn't there more balanced study and working to try to get the correct balanced where every dollar in taxes that go to welfare will go to more good and less leaching.

I can say the same with schools, I see schools that go over multi-million dollar renovations however those don't actually help the students it just make the place look nicer, spending money on computers just to teach the kids how to use office. That is the problem and why a lot of people don't want to pay taxes, it is because their large portion of their income is not going towards optimal or near optimal usage.

Re:Question

[kenh]

He's not lying about his profits - he's availing himself of the tax code as written.

Eric Schmidt/Google are not responsible for the tax code.

Did it ever occur to you that by highlighting the way the current tax code is written Eric Schmidt is working to bring about reform of the tax code? If he quietly exploited the tax code, how would the average citizen know what was going on?

Re:Question

[IamTheRealMike]

The public roads argument is interesting - do employers pay for roads so employees can get to work and so that they can ship and receive goods, or do employees pay for roads so they can get to work and buy the goods others have manufactured/raised/offer? The answer is both.

Roads are cheap, though. In the UK last year the govt spend about 1.5 billion pounds on them, out of a total budget of ~650 billion. The fuel tax income was nearly 3 billion. So, roads are a profit center for the British government. Maybe it's different in the USA.

Re:Question

[Anonymous Coward]

I do actually. As do most of the UK's population.

I live and work in the UK, and I take my pay through PAYE which means my income tax is automatically deducted. Most employees in the UK get paid this way.

I, and many others have the option of being paid outside the PAYE system so that we can manage our own taxes [...] by paying ourselves the minimum non-taxable wage and paying the rest out in a manner that doesn't attract things like national insurance.

You may want to look at the IR35 rules before trying that. Basically, if HMRC think you're an employee, you have to pay the usual employment taxes, regardless of the actual legal structure (true employee vs. self-employed vs. LTD etc.). The best you'll get by opting out of PAYE is moving from class 1 national insurance to class 4, which drops the effective tax rate by 3 points on the first ~40k in exchange for losing your entitlement to a state pension or job-seeker's allowance. For most people, that's not worth it.

(I'm not saying there aren't some other tricks you can use instead, but the old one of declaring yourself to be self-employed so that you can take your salary as dividends rather than income no longer works.)

(And, yes, I do pay extra tax because of IR35, and, yes, it is more than I'd pay as an employee, thanks for asking.)

Re:Question

[penix1]

Is the amount we put into corporate welfare good in keeping them off the streets and giving them a helping hand to get past some hard times in their corporate life, or is it a disincentive for them to change life, because they are getting everything they need without having to work for it? Why isn't there more balanced study and working to try to get the correct balanced where every dollar in taxes that go to corporate welfare will go to more good and less leaching.

FTFY...

Re:Question

[prisoner-of-enigma]

Really? You're arguing that parting with $5 billion that you didn't have to give up in the first place is the more *ethical* path to be taken? It's not like Schmidt is pocketing all that money himself. It goes back into Google where we get things like Google Maps (free), Google Fiber (faster and cheaper broadband), and myriad other projects that wouldn't exist without Google funding. It goes to hire hundreds, perhaps thousands, of employees for Google. That in turn produces thousands, perhaps millions, of jobs globally for people who service and supply Google's infrastructure (hardware makers) and provide for the employees (cooks, janitors, dry cleaners, etc.). Other bits of it go back to Google sharesholders who use the capital gains to fund other startups (more jobs, more opportunities, better products and choices for all of us) or produce other goods and services jobs (rich folks buy stuff, after all, and somebody has to make the stuff).

In short, you can stop with the wealth envy line. I'd much rather Google have the $5 billion than the U.S. government. Google is much more likely to spend it doing useful, productive, innovative things than the government -- *any* government -- ever would. The ancillary effects of Google *not* having paid that $5 billion in taxes are far more beneficial to you, me, and everyone else if it stays in the private sector, not in some politician's pork barrel fund for inefficient, unwanted, or outmoded government programs oriented more towards buying votes and propping up cronies than ever "serving the public."

Re:Question

[fuzzybunny]

Is he breaking the law?

No.

“For Eric Schmidt to say that he is ‘proud’ of his company’s approach to paying tax is arrogant, out of touch and an insult to his customers here in the UK,” she said.

Maybe, but that's a subjective judgment. Tax law is not subjective. There is a very good reason for that.

Google should recognise its obligations to countries like the UK from which it derives such huge benefits, and pay proper corporation tax on the profits it makes from economic activity here. It should be ashamed, not proud, to do anything less. ”

It pays proper corporation tax. Proper corporation tax is what is legally required. If you don't like the amount of tax Google is paying, close the fucking tax loopholes that allow it to get away with less.

As a private citizen who does not have the financial means to do a double Irish, blind trust, or whatever-the-hell-else legal mechanisms I could use to legally optimize my taxes, does it gall me that Google is paying such low taxes? Of course it does. I find the whole system loathsome and unfair. Do I want to see the laws allowing them to do this changed? Absolutely.

Do I want to see them subjected to arbitrarily made up rules that are contrary to what the written law says? Fuck no. If someone does not understand why this would be a bad idea, it's not really worth arguing.

Re:Question

[JoeRobe]

Isn't the point of having a tax code so that we don't have to decide how much to pay in taxes based upon our ethics? The government tells us how much to pay based upon its tax code, so we pay it. At no point do they ask us to pay based upon our ethical standards.

I guess I wonder what should Google do. Should they pay the maximum amount the UK government wants, and avoid all possible deductions and loopholes? Or should they pick the "normal" deductions that other UK businesses use? Something in between? Which deductions/loopholes should they choose? Which ones are ethical? And by whose standards are they ethical?

I use my ethical standards when I donate to something like the Red Cross or UNICEF. I don't donate my money to the government. Taxes are a bill I pay to receive the benefits that the government provides to me. I'll find any way I can, within the letter of the law, to reduce that bill.

Re:Question

[Liberty.45ACP]

How on earth do you think the government subsidies home schooling? We home school our son and pay property taxes that include subsidizing government schools. In the few areas that have some sort of voucher system, then those people may be getting some of their money back that was stolen (taxed) to support government schools.

Re:Question

[Anonymous Coward]

is that no one goes out of their way to OVERPAY their taxes

I think Mitt Romney did for 2011.

Re:Question

[mcgrew]

The current crop of GOP senators are very business friendly

That's a euphamism for "worker-hostile". "Oh, no, don't raise taxes on the billionaires, make the roofer pound nails until he's 70. Oh, and cut down the amout of doctor visits he can go to as well, medicare costs too much."

The GOP is the party of unbridled greed.

Re:Question

[circletimessquare]

Look around you. Civilization. Not possible without taxes and a strong central government. Sorry fanboys.

Re:Question

[penix1]

Because corporations including Google had a big hand in lobbying to have the laws made so they can avoid paying as much taxes as possible while still demanding the government services those taxes go to pay for. Nothing like tilting the table then blaming the table when things fall off it.

Re:Question

[Xest]

"I think you massively over-estimate the ease of"

What does the ease of it matter? It's not easy for companies to dodge tax either, but some choose to do so, others don't. I'm not sure what the relevance of your point is here - the fact remains that most people pay more tax than they strictly legally have to.

"Besides, what big companies are doing with tax isn't avoiding paying income tax on wages. It's corporation tax, which is very different."

Well it's very different because corporations are very different, but revenue is the closest thing companies have to individuals receiving income, and corporation tax is the closest thing on revenue to income tax on an individuals income.

But then, it wasn't mean that made the comparison between corporations and individuals was it? I was merely responding to someone that already had and answering their question.

"If you set up multi-national corporations you have to pick where you'll do business, and for an internet company that can do business almost anywhere, why would you deliberately pick a high tax region over a low tax one, with all else being the same? Do you like funding wars?"

But that's not what we're talking about, corporation tax in the UK is expected to be paid on revenue after all other deductions, the problem is that companies are creating fake deductions to ensure there is nothing left for corporation tax to be paid on, in Starbucks' case for example, they make up a fake intercompany "royalty" charge to a low tax area so that they shift off all remaining revenue to other low tax areas before corporation tax is paid on it. The point is it doesn't matter where they're headquartered at all, that's irrelevant, the point is that wherever they make money they should be paying the applicable taxes. Revenues earned in the UK should pay UK corporation tax, where they're basing headquarters only applies to non-revenue based taxes. I don't have a problem with them headquartering somewhere to pay the lowest non-revenue associated taxes such as say, land tax, but what I do have a problem with is them not paying revenue based taxes in the country they earn that revenue, that's the problem here - they want all the benefits of that country in terms of profit making (such as a good infrastructure, educated workforce and so forth) but they don't want to pay any of the taxes that allow that to exist in the first place. That makes them a parasite, and that's why people don't like it - because they're making those profits off the hard work of everyone else and contributing little or nothing back to society.

Thankfully, people like you that defend this sort of action are a minority in the UK, as since these came up as an issue, Costa Coffee, a UK competitor to Starbucks that pays all the taxes it's intended they owe has seen it's profits soar, whilst Starbucks has seen a decline. Even if HMRC and government wont come down harder on it, then at least consumer action is having at least some effect.

Re:Question

[Rob the Bold]

Don't be angry with Google for following laws that allow them to pay less in taxes than you think they should, be angry at the lawmakers that craft the laws that allow them to do so.

And also don't be angry at someone who uses food stamps, medicaid, unemployment insurance, social security, medicare . . .

"Why is it that if you take advantage of a corporate tax break you're a smart businessman, but if you take advantage of something so you don't go hungry, you're a moocher?" -- Jon Stewart

Re:Question

[tehcyder]

All taxation is unfair. Taxation is, essentially, legalised theft.

No it isn't. It's a means of redistributing wealth, which is why rightwing Americans in particular hate it so much. Some people pay more tax, some less, but it all goes to paying for things that are for the benefit of society as a whole.

Re:Question

[medcalf]

Well, I'd be VERY curious to know how government is subsidizing home schooling in the US, because I've been home schooling my kids for about a dozen years now, and not only have I never gotten anything from government to subsidize that, I've had to comply with various paperwork requirements (spending my time) and have had to pay for my kids to take standardized tests. In addition, I buy all their books and other school materials myself, and also pay the costs of any classes they take outside the home, all their extracurricular activities, field trips and the like. While doing all of this, I also have paid property taxes used to send others' kids to public schools, and also income taxes that are redistributed via both states and the Federal government to schools. So far as I can see, I'm subsidizing government schools, but the government is in no way subsidizing my home schooling. So please, oh enlightened one, tell me how to get in on this "Home Schooling is subsidized by the government" thing.

Re:Question

[medcalf]

And look how much credit that got him. If the choice is to overpay taxes or face moral indignation, or overpay taxes and face moral indignation, which way do you think people will choose?

Re:Question

[medcalf]

Straw man. I don't know anyone who's angry at the recipients of such programs, but I know plenty of people (and I'm one of them) who would argue that we have structured our social welfare and safety net programs really badly, funded them worse, and if we don't reform them they will destroy our economy.

Re:Question

[gfxguy]

Don't be angry with Google for following laws that allow them to pay less in taxes than you think they should, be angry at the lawmakers that craft the laws that allow them to do so.

And also don't be angry at someone who uses food stamps, medicaid, unemployment insurance, social security, medicare . . .

"Why is it that if you take advantage of a corporate tax break you're a smart businessman, but if you take advantage of something so you don't go hungry, you're a moocher?" -- Jon Stewart

I never belittled people for taking what the government offered - in fact, I face this ridiculous criticisms all the time in my discussions with people; the fact is, I belittle people for demanding more, and I belittle companies for their lobbying efforts, and I belittle the lawmakers that allow it all to happen. I don't even consider people who complain about all the government programs and then take advantage of them to be hypocrites - they were forced to pay for the system, it wasn't their choice. But ultimately both of those 'welfare' arguments point back to the legislators who buy votes and get bought by lobbyists - it always comes back to the lawmakers. There are systems of taxation that eliminate the purpose of lobbyists, but nobody ever wants to even discuss them - everyone wants everyone else to give up their deductions.

Re:Question

[circletimessquare]

monaco is a tiny parasitical entity. funded by the rich from other countries

maybe somalia is the example you were reaching for

Re:Question

[suutar]

http://investor.google.com/corporate/guidelines.html looks like what you want.

Re:Question

[Mr. Mikey]

Taxation isn't theft.

Taxation is the honoring of a contract, the social contract you are implicitly a signatory to as a citizen of a civilized society.

You gain the benefit of roads you can drive on, tap water that is available and safe to drink, house fires that get put out, an educated populace (you know, all those citizens who don't happen to be your son), and so on.

You pay for those benefits via your taxes.

If you don't wish to enjoy those benefits, you are free to go somewhere like Somalia, where you won't be burdened with them... and neither will you enjoy all those benefits.

Good luck with that.

Re:Question

[Sloppy]

those same corporations are buying those same politicians specifically to favor them with laws written by the corporation lobbyists.

And yet it'll fall apart if we, on voting day, withdraw our support for those politicians. We never do, though.

We The People know how Democrats and Republicans get the text of the laws they enact, and every two years we re-affirm that yes, we want those people to keep on doing that.

There's nothing wrong with being angry, but you're getting angry with a machine that we've signed off on, which acts in a predictable fashion and hasn't malfunctioned. We knew what we would get, and we got it. Be angry at our hypocrisy instead, where we say we want fair government, but then vote against it, sometimes with mumbled excuses for why we reluctantly did it yet again.

I know what you're thinking: being angry at our hypocrisy will just lead to an acknowledgement of our responsibility, and nothing good ever comes of that. What we need is for a new veil of self-deception, since the old one is so tattered. Nobody believes our old excuses, or believes that we're stupid enough to believe them. It's time for a fresh start. Therefore, for the 2014 elections, I propose we each dedicate ourselves to one of two projects:

1. One team should come up with some new and credible reasons for why we should send Republicans and Democrats back to Congress again in 2014. Please, no right/left arguments; the claim that these parties politically ideological, is very old and tired and long-past exposed. Try a new approach to justifying these people, please.
2. The other team should come up with some credible pretenses for how we can all act SHOCKED, when the Democrats and Republicans "surprise" us by doing what they always do. What we want here, is for there to be a tragic narrative about how we all believed the stuff the first team comes up with, how it was an honest mistake anyone could have made, in spite of, in hindsight, being moronic beyond the imagination of the very best comedians.

We can do this if we try. There is no reason we, our our children, should ever have to face the realization that political power always rests in the hands of the governed.

Re:Question

[TubeSteak]

He has a company. He has one job to do, precisely one responsibility to his board of directors and shareholders (and himself).

That responsibilty: To make money.

[Citation Needed]
This is a pernicious idea that is a parody of what America actually is.
What you're really claiming is that the nature of our social compact has changed in a horribly negative way.

When Google went public, they explicitly told everyone that profit was not their goal, that they would be doing weird things that weren't always going to be profitable, and that you shouldn't buy Google's stocks if you didn't like the plan.

Re:Question

[halltk1983]

Start calling them out on the treason that is accepting bribery. Stop voting for the parties in power, and start voting for those that would change things. Looking at parties that support the Fair Tax or one of the more flat taxes is a good start.

Re:Question

[shilly]

I thought you had to be bright to work for Google? How come you're so fucking dumb that you don't even understand that road infrastructure is a tiny fraction of all associated costs of road use and that fuel duty doesn't come close to covering the externalities?

Re:Question

[Rakarra]

And once he's old enough, who's going to hire him without an accredited degree, regardless of his abilities? How's do you think he'll get through any HR dept?

When it comes to high school education, all most HR departments will care about is whether you have a GED. And for jobs that require a college education, they have no interest where (or whether) you went to high school, kindergarden, 1st-8th, etc. No one puts it on a resume (doing so would raise eyebrows simply for strange it is) and no one asks. No one cares because it doesn't matter.

Re:Question

[TFAFalcon]

But why are taxes the only part of the social contract that people want to not apply to them? They still expect the protection of all their 'rights', but object to their 'obligations'. Why don't they move to a place where society has broken down (Somalia from what I hear) and live there?

Re:Question

[LurkerXXX]

Flat taxes are horribly regressive and taxes every dime a poor person has (because they have to spend it) while taxing a very tiny portion of the money a rich person makes.

Re:Question

[MightyYar]

I'm a bit biased though as I'm strongly libertarian.

If you were really strongly Libertarian, you'd probably be anti-corporation... Corporations screw with the free market, but that's not what really messes up Libertarian ideology - far worse is the limited liability. If a person can screw up your property and hide behind a corporation, then the basic principles of Libertarianism cannot function.

My ideological leanings are towards the Libertarian side, but I'm far too pragmatic to call myself a Libertarian. I do have a growing dissatisfaction with these mechanisms that government has invented to screw with the free market: copyright, patents, corporations (and by extension unions).

Re:Question

[Myopic]

"I don't know anyone who's angry at the recipients of such programs"

I suspect you actually do, but if not then you live in an incredibly tiny bubble. I myself live in a medium sized bubble, and even I know scores of people who are angry at the poor.

Re: Question

[Man On Pink Corner]

How about you go to Somalia while the rest of us stay here? For some reason that option never seems to come up in these threads where some nebulous and mysteriously unproducible "social contract" is used to justify the implementation of a totalitarian nanny state.

Re:Question

[halltk1983]

The Fair Tax is a sales tax, but it gives the same refund check to every American citizen from Bill Gates to a single mom of four, based off the entire amount of taxes that they household would pay if they were earning money to live at the poverty level. That means if you live below the poverty level, you pay negative taxes. At the poverty level, no taxes. At double the poverty level, half taxes. And as you approach "omgwtfbbq-super-rich" it approaches, but never touches the rate of 23.5%. No other tax breaks, loop holes, etc, and we can get rid of the IRS and replace it with a much more efficient system to collect taxes from businesses and track the households to return the refunds to. It's very progressive, not at all regressive. Perhaps you'd like to read more about it?

Re:Question

[Myopic]

Yawn.

THE COUNTRY DOESN'T DO WHATEVER I WANT THEREFORE I COMPLETELY DISMISS IT!

Get real, man. We vote, the votes are counted (usually, excepting Florida in 2000), and the winners rule the republic. Pointing out the imperfections of how the democracy is administered doesn't make it not a democracy. You sound like a child. Grow up.

He's right

[Cornwallis]

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.

Re:He's right

[Simulant]

Except we're discussing the UK tax code.

Re:He's right

[girlintraining]

Please. Someone go after them.

Many have tried. They're all awaiting trial now or in jail. The main purpose of law enforcement is to maintain the status quo. You're not going to beat the system working within it or exposing yourself to it. That's been proven since the 60s in this country when, depite massive public opinion against it, the war in Vietnam continued. It's going to take more than words, banners, and a few picket lines to fix this problem -- our law makers do not listen even when they are surrounded by thousands of angry voters, because they know that voting and protest are both ineffectual. If you manage to get rid of one bad politician, another will take his/her place. The amount of effort required to overcome the bureaucratic inertia reinforcing and protecting these laws and legal mechanisms to extract money from the poor and give them to the rich is beyond the capability of even hundreds of thousands of organized citizens.

I cannot see this changing short of a major civil uprising.

Re:He's right

[ultranova]

I can't fault anyone for taking advantage of legal loopholes.

Why not? "I' won't be punished for it" is hardly good moral reasoning - indeed, it's literally infantile morality. And it actively harms society, not only by pushing tax burden on its weaker members but also by acting as an incentive to control all aspects of behaviour through laws.

Why on Earth should we not fault executives for refusing to grow up?

Re:He's right

[Cornwallis]

Do not be mislead by receiving 'insightful' ratings on this comment. It is anything but insightful. No matter how the tax code is structured, corporate attorneys will be able to devise methods to avoid paying taxes.

Not. If. There. Were. A. Simple. Flat. Tax. That. Applied. Across. The. Board.

Period.

Re:He's right

[iluvcapra]

A progressive income tax is just as simple mathematically and creates much less deadweight loss on the economy.

Re:He's right

[danbert8]

Even better, apply it to sales instead of income and make it easier as then you can see the direct effect of taxes at every transaction rather than hiding it in several layers of transactions. See http://www.fairtax.org/site/PageServer

Re:He's right

[danbert8]

Perhaps you didn't actually read the fair tax and the fact that you get a prebate to cover taxes basically to the poverty level. Or the fact that a rich man paying 20% on Christmas presents is significant if he is buying expensive presents.

More importantly, the VAT in Europe is ON TOP OF income taxes, not a replacement for it. The idea is that taxes discourage things (yes, economics says if you increase the cost of something, the demand goes down). Thus if you have to discourage something, you should discourage consumption (sales), not production (profit, income).

Mobile Capital

[SkunkPussy]

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.

Especially the robot CEO's

[Anonymous Coward]

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.

Do No Evil

[Anonymous Coward]

The more Schmidt speaks the less you can take the do no evil line seriously.

Re:Do No Evil

[K. S. Kyosuke]

Hmm. I'm not sure how much evil that is. After all, the money stays in the hands of a US company, or not? They're still going to spend it in the US economy.

Re:Do No Evil

[ArsenneLupin]

What the fuck has "do no evil" got to do with being a US company?

If it were an Iraqi company (or a North Korean one), it would be "do no good". Or did I just get that backwards?

Re:Do No Evil

[N1AK]

Not paying more tax than you are legally required to isn't evil; being honest about not minding doing it isn't evil. People need to stop throwing around hyperbole before we get to the point where it's "OMG Google are evil, someone died somewhere of something money could solve and Google didn't give them any!"

Re:Do No Evil

[jrumney]

Not paying more tax than you are legally required to isn't evil;

Evil is about morality, not legality. So yes, it can be evil when taken to the sort of extreme that Google and others have.

Re:Do No Evil

[K. S. Kyosuke]

Evil is about morality, not legality. So yes, it can be evil when taken to the sort of extreme that Google and others have.

So you say that screwing your shareholders is moral now?

Re:Do No Evil

[shutdown -p now]

If your shareholders want you to screw other people, and you "screw" them by refusing to do that, then yes, it's perfectly moral.

robot workers

[Iamthecheese]

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.

Re:robot workers

[chthon]

But you could tax the usage of robots.

I do not know about other countries, but here in Belgium there is a tax on power equipment, e.g. electro-motor based things, in function of the power.

Re:robot workers

[TheLink]

Look around you, just imagine the Chinese, Vietnamese, Indian, etc workers are robots.

How well is it working out now for the US people competing against these "robots"? How well will it work out in the near future? And how well will it work out when cheaper and more advanced robots arrive?

If you think it's going to be fine, that's great. Not really my concern - after all I'm a cheap worker/"robot" in a 3rd world country. FWIW seems I can read, spell and write better than many of the US slashdotters here. I suspect I even think better than a fair number of them...

Re:robot workers

[Billly Gates]

But you could tax the usage of robots.

I do not know about other countries, but here in Belgium there is a tax on power equipment, e.g. electro-motor based things, in function of the power.

Boy, if that wont get manufactures to leave your country and go to China I do not know what will! I hope your friends and family enjoy unemployment. It makes sense to move the office workers too close to where the Asian robots are. More money and a higher shareprice for the CEOs bonus

Corporate Taxes == Political Favoritism

[CajunArson]

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.

Re:Corporate Taxes == Political Favoritism

[Overzeetop]

3%-5%, but on gross receipts, not profits. The security, safety, and infrastructure the US Government provides is a cost of doing business, not a luxury which is consumed when profit occurs.

Re:Corporate Taxes == Political Favoritism

[Maximum Prophet]

10%, or tithing, has a many thousand year history.

He may have arbitrarily picked from many different tax schemes, but he did not "make it up"

Socialism may win after all

[Gr8Apes]

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.

Re:Socialism may win after all

[runeghost]

Extrapolating from current trends, we're going to hit the hyper-wealth singularity only to find out that it's a feudal nightmare.

Tax avoidance is abd for a simple reason

[aepervius]

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.

Re:Tax avoidance is abd for a simple reason

[MadKeithV]

*THEY* , the politician , have a lot to explain. not the company using it.

Capitalism is not a free ride for abdicating all sense of morality to the government. Nobody is forcing the companies to be creative in their tax avoidance either. "It's okay 'cause it's legal" is a moral cop-out and a dangerous argument, because then you imply that everything which is law is okay, so if the US would pass a law requiring unfairly high corporate taxation if you sold any product there, it would HAVE to also be okay with the same people, and it clearly is NOT.

The most interesting bit is about unemployment

[javilon]

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.

Re:The most interesting bit is about unemployment

[SuricouRaven]

That would be a very likely dystopia. Automation leading to mass unemployment, but without the foresight to shift society to a model able to operate under those conditions. The result being billions of people living in poverty because there is simply no work for them to do, while those who do control wealth have no incentive to share it freely. The only apparent solution is some sort of techno-socialism, but the S-word is considered obscene in US politics, so that isn't going to be easy.

Re:eric schmidt is text book hubris gross arroganc

[Half-pint HAL]

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.

Robots are already the cause of unemployment

[Overzeetop]

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.

Taxes are used for policy. US view

[Anonymous Coward]

*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.

Re:eric schmidt is text book hubris gross arroganc

[danbert8]

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.

Re:eric schmidt is text book hubris gross arroganc

[jrumney]

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.

Deliberate stance

[gr8_phk]

I disagree. I think they are focusing on exactly that; abuse of the tax system.

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.

Yeah. But what's "reasonably" angry?"

[Chas]

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 that easy in reality

[sjbe]

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.

Re:Not that easy in reality

[MightyYar]

it is really, really difficult to define income in such a way that it closes all potential loopholes

Agreed. I'm saying don't try. Only tax individuals. Sure, they can play games with getting things like company cars and not count them as income, but they already play such games and my proposal won't make this any better or worse.

Umm, then companies will stop paying dividends and companies can avoid paying taxes by avoiding realizing capital gains.

Companies paid dividends before the special dividend rate - stockholders will want to get paid, whether they pay more tax or not.

Companies would have no reason to fear capital gains, because they wouldn't be taxed on them.

Re:Yeah. But what's "reasonably" angry?"

[circletimessquare]

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.

Re:Yeah. But what's "reasonably" angry?"

[mjr167]

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.

Re:Yeah. But what's "reasonably" angry?"

[Kwyj1b0]

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.

Re:Yeah. But what's "reasonably" angry?"

[serviscope_minor]

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.

Artificially Low Interest Rates lead to Automation

[trout007]

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.

Re:Yeah. But what's "reasonably" angry?"

[Rob the Bold]

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.

Re:Yeah. But what's "reasonably" angry?"

[gfxguy]

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.

Re:Yeah. But what's "reasonably" angry?"

[serviscope_minor]

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.

Re:Yeah. But what's "reasonably" angry?"

[circletimessquare]

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

Re:Yeah. But what's "reasonably" angry?"

[TheCarp]

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.

Re: Leave

[Mr. Mikey]

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.

Re:Yeah. But what's "reasonably" angry?"

[Billly Gates]

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.

Re:Yeah. But what's "reasonably" angry?"

[DamnStupidElf]

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?