Slashdot Mirror
Facebook Paid 0.3% Taxes On $1.34 Billion Profits
theodp writes "Facebook is unlikely to make many new (non-investor) friends with reports that it paid Irish taxes of about $4.64 million on its entire non-U.S. profits of $1.344 billion for 2011. 'Facebook operates a second subsidiary that is incorporated in Ireland but controlled in the Cayman Islands,' Kenneth Thomas explains. 'This subsidiary owns Facebook Ireland, but the setup allows the two companies to be considered as one for U.S. tax purposes, but separate for Irish tax purposes. The Caymans-operated subsidiary owns the rights to use Facebook's intellectual property outside the U.S., for which Facebook Ireland pays hefty royalties to use. This lets Facebook Ireland transfer the profits from low-tax Ireland to no-tax Cayman Islands.' In 2008, Facebook COO Sheryl Sandberg cited 'local world-class talent' as the motivation behind Facebook's choice of tax-haven Dublin for its international HQ. Similar tax moves by Google, Microsoft, and others who have sought the luck-of-the-Double-Irish present quite a dilemma for tax revenue-seeking governments. Invoking Supreme Court Justice Potter Stewart's famous common sense definition of ethics ('Ethics is knowing the difference between what you have a right to do and what is right to do') is unlikely to sway corporations whose top execs send the message that tax avoidance is the right thing to do and something to be proud of."
but they're still actual human beings - not a faceless entity - who make the decisions and understand the ramifications, so they and all of the other corporations (and individuals) who seek tax havens are essentially privateers and definitely scumbags.
www.chihuahuarescue.com- Help to end dog abuse, abandonment and cruelty
Oh so you would like to pay for the police, the firemen, the roads, and everything else? We can argue about a bloated government, no doubt. But to argue that we should pay zero taxes make NO SENSE WHATSOEVER.
For if we don't pay taxes you better be prepared to pay Vinny down the street a bit of money to make sure that you don't get mugged, robbed, or killed.
Simply put, you sir are a nutter! Even Adam Smith knew we had to have a government and had to pay taxes!
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
You live in a complex society where the police are obliged to protect your personal property and your life, where food is not full of melamine, where we have a military that enforces our economic interests, where roads improve the flow of goods and services.
Pay for it.
--
BMO
Government makes stupid laws.
Companies follow those laws.
This is the fault of the companies and requires more government.
t
Tax avoidance is good business. But I would also want to make sure that USA companies don't totally offshore their revenues ... and jobs. This is why we need tax reform.
Tax avoidance impoverishes the job creators in order to transfer wealth to the leaching class.
Job creators being the working people who actually create wealth through their labor, and consume goods to drive the capitalist system.
Leaching class being the plutocrats who do nothing but extort and siphon off the labor of others.
Because it is flamebait! Some folks have this fantasy that you can get everything for nothing. Things cost money! As I was writing to the GP, sure we can argue about a bloated government. But to argue that tax avoidance is a good thing is not correct either.
Police, military, firemen, judges, etc, etc all cost money. Adam Smith who was a capitalist wrote in his papers that government and taxes were needed. The question is how much government, not whether or not government there is a government.
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
...is to pass a law which states that the government will not provide material support or assistance to companies who offshore their profits.
Your container ship full of product headed to Europe gets hijacked by Somali pirates? Well, you can either ask the Liberian government (your ship's flag of convenience) or the Cayman Islands government (your international HQ) to help rescue your ship.
Website breached or attacked? The FBI isn't going to help.
The Chinese pirating your IP out the back door? Sorry, the State Department won't be lobbying China on your behalf.
You want a real government's help? OK, well then you have to pay taxes to the real government. Having a shiny sign on some skyscraper where 1% of your workforce lives, 50% of your profit is generated and nearly none of your income tax is paid means you're really not a local entity and won't get the government on your side.
Seems logical to me. Ireland is happy to get 4 million that they wouldn't otherwise get at all. Ireland's simply undercutting other governments. Makes sense.
But if you want to collect tax dollars from companies that operate in the .U.S.A., you might want to assess their global revenues, period. Global companies paying global rates makes perfect sense.
Otherwise, you're looking at a future without tax revenue. Good luck with that. Let me know how it goes.
On the other hand, you can look at this as simple capitalism. Ireland made a better offer. You lost. Suck it up, or learn to compete.
Either way, don't bring ethics into it. You're talking about taking someone's money for "the greater good". And you're forcing them to participate. If you're going to discuss ethics, you might want to start with your own.
I like to pay taxes, with them I buy civilization.
That a lot of deluded "rugged individualists" falsely think they are entirely self-made and have no obligation to pay back into society amuses me. Seeing them frustrated and resentful at paying taxes makes me smile.
If you build it, nerds will come. Soylentnews.org
Come on people, get with it! You realize that Facebook is owned by a member of the "family" right? Look at who the owner is related to, and what they are doing for the Government. I'll bet that after they get paid by the Government for spying, that US citizens actually pay them to exist and be a business.
/sigh
-The wise argue that there are few absolutes, the fool argues that there are no probabilities.
Good luck with the police thing.
How about we just close the loopholes? If you have a US based company that is clearly operating a subsidiary, that subsidiary (even foreign) will be subject to US taxation. Far simpler strategy.
THANK-YOU!!! I used to work a hedge fund and talked to a guy who lived in Monaco and worked on tax avoidance schemes. He was not happy about the idea, but liked the work because it paid well. The issue here is that governments have to clamping down on this royalty kickback scheme.
It is a really bogus idea. Here is how it works. You have a company, it does not matter what kind of company. This company produces a widget and sells it across the world. You open a subsidiary, and that subsidiary sells your widget. The subsidiary has to pay something for the widget. In the old days it was costs of subsidiary, and wholesale of the widget. Now its, wholesale of the widget, plus a royalty.
The royalty is the kicker here. For it is a nebulous value that the company can define to be any feather I pull out of my arse. In most cases it basically eats all of the profits generated everywhere.
Trying to get rid of this is hard for you would be circumventing tax law where you really need to be able to not be taxed on foreign income. What needs altering is the concept of royalty and the governments have to say, "royalty, see this middle finger, that is your royalty."
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
"Some folks have this fantasy that you can get everything for nothing."
Some folks wish they got a lot less from government.
Some folks have this fantasy that they are entitled to someone else's money.
A vast majority of tax money, though, goes either to waste or to things that are outright harmful for the taxpayer. And even for police and judges, a big part is spent gathering the driving without disrupting traffic flow tax, and to patent/etc litigation, respectively.
The creatures outside looked from Alt-Right to Antifa; but already it was impossible to say which was which.
You are raising an argument that does not exist. I wrote very clearly we can argue about a bloated government, but not about taxes. You are saying that I somehow want people to pay high taxes for other people. I did not make this point and thus please stick to the argument.
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
I suspect the poster, as most people, choose not to pay more tax than they're required to pay.
In a simmilar way that his credit card legislation didn't result in banks raising fees and interest rates to recoup lost profits.
They didn't have to raise their fees, they raised their fees because they had an excuse to. If they thought they could charge more before that happened they would have charged more. Just because someone gives a reason as to why they are screwing you over that reason shouldn't be believed, but it should be acknowledged that you are being screwed over.
Don't know something? Look it up. Still don't know? Then ask.
Making corporations paying taxes on profits is double taxation and should not be done. Rather the profits should pass through to the owners (investors) and then the investors should pay taxes as if that was their earned income. Any retained earnings by the corporation (profits not passed through to investors) should be taxed as if it were earned income. This includes paying SS, Medicare, Medicate, workman's comp, federal, state and local income taxes.
While we're at it lets eliminate all the loopholes, subsidies and deductibles on the personal income taxes as well.
Wouldn't a simple fix for the countries involved just be to impose a tarrif on the importation of the "IP Rights"? Just set it to be equal to taxes on profits, and the problem is solved. So, FB UK doesn't make a paper profit of, say, 3 billion because their revenues of 3.2 billion are offset by "IP Licensing Costs" of 3 billion - just tax the importation of the right and collect the same amount as you would if they didn't try the shifting.
Yeah, and? I wrote clearly, we can argue about the bloat, not about the argument of paying taxes. Vast amount of money goes to things that are harmful? Please check the budget of governments. The stuff you mention is peanuts compared to what really sucks up the cash. It is things like military (depends on the country), and pension benefits (most countries). Unemployment, etc do not suck up much cash. Those are just populist arguments as people and politicians want to keep things the way that they are.
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
Only if you are a corporation. If you are an individual, you must support our troops.
May Peace Prevail On Earth
It is a fact of law in the US that the police are not required to protect you or your property (at least in most jurisdictions).
In its landmark decision of DeShaney v. Winnebago County Department of Social Services,” Stevens writes, “the U.S. Supreme Court declared that the Constitution does not impose a duty on the state and local governments to protect the citizens from criminal harm.
In Warren v. District of Columbia, it is a "fundamental principle of American law that a government and its agents are under no general duty to provide public services, such as police protection, to any individual citizen."
In Castle Rock v. Gonzales, "the police have no duty under federal law to protect the citizens."
There are other cases that more or less have the same result.
When seconds matter, the police are only minutes away. Maybe.
You are raising an argument that does not exist. I wrote very clearly we can argue about a bloated government, but not about taxes. You are saying that I somehow want people to pay high taxes for other people. I did not make this point and thus please stick to the argument.
Facebook paying no taxes is the kind of crap you get when you get a large powerful government that makes it worthwhile for entities with a lot of money to bribe, err, lobby that government to make rules favorable to them.
Don't like it?
Quit voting for candidates who want more and bigger government.
THAT'S the root cause of the problem.
I get it. You don't like paying for lazy people. Fair point, neither do I.
But what happens if you stop welfare? Crime rates go through the roof. People that can't eat get desperate and start doing things they'd never do otherwise. Poor people won't just starve and go away, they WILL rise up and take a lot more from you.
People are only complacent when they have something to lose. If you give them a little something to lose, then you can control them better. Create a society of have's and have not's and eventually the have's are all destroyed by the have not's.. It's happened throughout history, and apparently people don't learn from it.
If you need web hosting, you could do worse than here
where the police are obliged to protect your personal property and your life
http://en.wikipedia.org/wiki/Warren_v._District_of_Columbia
where we have a military that enforces our economic interests
did you just advocate colonialism 2.0?
The way this country was set up is if you're about to get mugged, robbed, or killed, you invoke your gun holding right and use it. This has been warped beyond recognition, but... if you've ever called the cops to come help you / do something for you that doesn't involve them harassing you... you're better off keeping your dollars and buying the gun.
On another note, I think the state fixes most of the roads, so cali would benefit from taxing facebook / MS / etc... the most there.
I'm sure the pro's of having the tech giants on shore with minimal taxes outweighs them moving most of their assets away as they're all about profits and stock holders. It would benefit us to see them pay more taxes, but it's a tough battle to win.
where the police are obliged to protect your personal property and your life
http://en.wikipedia.org/wiki/Warren_v._District_of_Columbia
where we have a military that enforces our economic interests
did you just advocate colonialism 2.0?
sorry, meant to reply to another post
When government spending is at a level where the bulk of it is for things that the overwhelming majority agree are important things for the government to do, then you would be correct that tax avoidance is wrong. However, the world we currently live in has few if any countries where the overwhelming majority agree that the bulk of government spending is on important things for the government to spend money on. There may be disagreement as to what the important things are, and you might not be able to get a majority to agree to cut any one thing (although I am pretty sure that if Congress were to start passing spending bills that each contained only one thing, the budget would drop in size overnight--not just because they would never have time to pass all of the bills).
The truth is that all men having power ought to be mistrusted. James Madison
Just WAIT til you find out how IKEA operates! Go on, look it up yourself, you wouldn't believe me if I told you!
Mostly random stuff.
As an individual or a business, you are supposed to look for ways to pay the least amount of taxes. That's life and there's nothing really wrong with that. If someone didn't look for ways to get as many deductions as possible on their tax return, you'd wonder if they were mental and just enjoyed paying a higher rate. The same applies for businesses. The government so far has said that there is nothing wrong with what they are doing.
The core problem here is with these loopholes. The tax system is a constantly changing cat/mouse game of people/companies finding loopholes and the government closing them. The REAL question is why hasn't this enormous loophole been closed yet?
This assumes that the govt officials are not in the corporation's pockets and have the taxpayers best interests at heart.
Are you that naive?
Start using the NSA for some good and uncover the people involved.
In addition, start taking advantage of the nature of these tax domiciles as being easily knocked over by a superpower's military. Offer to disclose each conquered country's information to other regions such as the UK and EU. In any case, move in a way that thwarts any effort to move out assets to "somewhere else".
Finally, be willing to use extraordinary rendition to moot jurisdiction movement. This would be viable for cases such as Eduardo Saverin, and assets of companies sent offshore.
In any of the cases, there will be no shortage of people willing to defend their country from tax jurisdiction abuse. With plenty of people out of work - more than a few leaving from good jobs - opportunity exists to discourage/deny the use of creative accounting.
(If you really want to turn up the heat, ensure that nobody involved, whether directly or indirectly, will have any protection from the US)
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
And if there wasn't a large and powerful government, then corporations would suddenly have no power over the system? How does that work?
Rob
Sure, that will go over well...right after the country that subsidiary is located in agrees to stop taxing it. Of course, if you pass that law and get other countries to agree to not tax the subsidiaries, pretty soon the "parent" company will be based in a no-tax country.
The truth is that all men having power ought to be mistrusted. James Madison
The problem isn't "more" or "bigger" government - but having a government that has the balls to stand up and say "pay your fair share"
Unfortunately - here in the UK we have the same problem... the people pay more while the corporations pay next-to-nothing
If you are actually paying a higher percentage of your income than your workers, then you're doing it wrong. Yes, rates at your income level are higher, but you also (should) have more options with which to shelter your income. Warren Buffet pays a lower percentage of his income in taxes than his secretary. So I think your sense of indignation that you pay a higher rate is misguided.
[Sir Garlon] is the marvellest knight that is now living, for he destroyeth many good knights, for he goeth invisible.
Corporations follow the laws of capitalism, not the laws of ethics. They will never pay more than they are legally required. If you don't like it, change the laws.
>did you just advocate colonialism 2.0?
We've already had it ever since the end of WWII.
What the fuck do you think the military is /for/?
--
BMO
Police, military, firemen, judges, etc, etc all cost money.
Well, when a fire erupts at the Facebook HQ, simply don't send the firemen when Facebook calls and tell them to contract a private firefighting company. They will have the fire put down by that company and will simply pay an invoice for the services rendered. :-)
Ezekiel 23:20
Set up an AMT for corporations that operate in the US. If they are bigger than a certain size in terms of US revenues, then they have to pay a minimum tax rate on those revenues or the usual taxes on profits, whichever is higher.
Yes, that sucks for low margin companies with lots of revenue, but it's likely better than letting very profitable companies like MS, Google, FB and many others get off essentially scot free through international tax games.
I think most of the disagreement depends on the definition of "society". Binning coarsely, we have group A who wants a libertarian anarchy. Group B wants to pay for shared infrastructure, but not the welfare state. Group C wants a social democracy with a variety of personal, non-infrastructure services guaranteed as rights. Lines blur of course, but that's the general idea.
Choose your own definition of society. I'm not sure exactly who you mean with your comments - I agree with you on the group A nuts who think that private enterprise will develop useful markets, electrical grids, roads, etc. However, I agree with those who dearly want to pay for infrastructure, but don't want to have to pay everybody's personal bills as the cover charge into "society".
so... in the castle rock v. gonzales case, we have the supreme court taking a federalist position (can't sue a town under a federal statute), which is something libertarians generally like (smaller government and laboratory of the states and all that). at the same time, you're using that case to argue that public services are ineffective, because they aren't enforced at the federal level.
which one is it going to be, then? you can't have it both ways. (well, actually you can, but only because no one stops to think about it.)
there's nothing stopping the individual states from, you know, requiring a duty of their police to provide public services to individual citizens. the warren v. district of columbia case was, unsurprisingly, restricted to the district of columbia, which is infamously fucked up anyway. any state, and d.c., could trivially legislate a greater duty to its police. but of course that would cost money, and the libertarians would crow on and on about how we should instead have private security for rich people.
"They were pure niggers." – Noam Chomsky
When talking about income taxes, yes, you are member of the society, you benefit from such things, you should pay taxes. Companies, however, don't benefit from army, from healthcare and from any other things that society provides. In fact, when nobody uses the company, the company ceases to exist. Taxing the companies only forces the companies to spend every year the most so they don't have to pay such high taxes. For me, it is not bad if for example Microsoft holds great untaxed amount of cash this year and invests it the next year or the year after. The company is already punished for not spending their money by inflation, the income tax is just bad tool and shouldn't be used.
300K per year?
Have you ever actually seen an annual social security statement?
I suspect not.
A Pirate and a Puritan look the same on a balance sheet.
Even a libertarian can acknowledge the fact that you don't want Crassus Maximus as your fire chief.
A Pirate and a Puritan look the same on a balance sheet.
The Caymans and Ireland are tax shelters. It is not clear in a just system why these goverments should get any of Facebooks profits. How are Irish roads or Cayman firefighters providing a service for Facebook? Facebook profits come from advertising. It might be smart for countries to focus their taxes on the ads. Tax advertisement revenue instead of profits. This would distribute the wealth to locations where Facebook is used and where profits are generated.
>Companies, however, don't benefit from army
Bullshit.
It's like the Banana Wars never existed, eh?
--
BMO
If the community spent half the energy we spend flaming each other with the same argument over and over and over calling their Congressmen to yell at them, faxing their Congressmen copies of large checks written to their opponent in the upcoming election, etc., then things might start to change.
If Slashdot were chemistry it would look like this:Cadaverine
Short distance travel, even without motor vehicles, is facilitated by roads too. Just ask the Romans.
(do you live in some place that is perfectly flat for hundreds of kilometres?)
At risk of being modded down -1: Disagree, there's an important counterpoint worth mentioning here:
Companies have a legal duty to pay taxes according to the laws.
Companies theoretically have a moral duty to pay taxes according to the spirit of the law.
Companies have a legal duty to minimize expenses and maximize returns for their shareholders and investors.
Accordingly, corporations have a legal duty to engage in legal-but-potentially-morally-questionable tax sheltering to minimize expenses and maximize returns for their shareholders. If a director is not using every tool at his disposal to make a business profitable, then at best he will be fired or reprimanded for being a bad director, and at worst he will be sued for breach of his fiduciary duties.
It would appear that a better solution is simply to write simpler tax laws that don't create the loopholes in the first place rather than to try to patch the loopholes with more convoluted tax law. But that is so very much unlikely to happen while Congress is immune to the insider trading and securities exchange laws. Congress won't think that this is broken so long as they're the ones making money off of the loopholes, even if it's at the expense of the U.S. taxpayer.
Gunfighter does not use roads. Gunfighter does not depend on any sort of regulation. Gunfighter is a self made man, and has never relied on anything that society/civilization provides. Gunfighter is also either naive, or an idiot.
Actually there is. During Clinton's presidency they enacted Welfare Reform that required getting work to continue receiving welfare, no work meant no more welfare. We dropped welfare roles by record amounts and as far as I know there wasn't a spike in crime.
Or were you looking for an example like the guy who brougt it up where cutting welfare was bad? I don't know of any examples like that except maybe for current day Greece.
The truth is, facebook only collected X million dollars while making a lot more. As in, all their services and such cost a certain amount of money plus that owed to the government. It is known as embedded taxes, this is a great tool of governments to use in avoiding the general population from understanding their true tax load.
A tax on corporations is just an indirect tax on those who directly or indirect interact with that corporation. Any penny paid in taxes by the corporation comes from its customers and so on and so on.
The real fixes are open honest taxation. Let people really know how much it costs them for what they receive.
* Winners compare their achievements to their goals, losers compare theirs to that of others.
That tends to be the confusion. People forget that the US government is actually very weak. It feels powerful to average citizens, but is generally weaker then many of the quasi-state corporations living within its borders.
The less that a government can do the less that the power that the corporations have over the government matters to the rest of us.
Why is it so hard to only have politicians for a few years, then have them go away?
But to argue that we should pay zero taxes make NO SENSE WHATSOEVER.
Suggesting no corporate taxation is not the same as suggesting no taxation.
For if we don't pay taxes you better be prepared to pay Vinny down the street a bit of money to make sure that you don't get mugged, robbed, or killed.
Even if Facebook were paying more in taxes, that money wouldn't be paying police in my town. It wouldn't even be paying police in the town where Facebook's employees live. Or fire departments, or roads, etc. Taxes paid by Facebook employees, however, do pay for government services where they live.
Focus on taxing the money at the point it gets transferred to individuals and the only way the taxes can be avoided is to move the people... but if they move the people they move the costs as well as the revenues. Note that companies can't work around this by giving employees (or executives) cars, houses, etc., because those sorts of benefits are treated as taxable income.
Counties and cities can, and should, also use property taxes to get the cash required to maintain roads and other local infrastructure used by corporations and their employees.
Set corporate taxes to zero and focus on taxing the money as it flows out. This would include taxing capital gains. Then corporations would have no reason to move to Dublin... unless they really are looking to use Irish labor.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
Smith was not a capitalist.
When governments control more and more aspects of your life and take more and more of your money then of course the corporations that run the government have more power than ever. I don't mind paying taxes but I make less than 100,000 dollars a year and pay more than 50,000 a year in taxes by the time the Feds, State and local governments get through bleeding me. I remember when I was young and thought that 100,000 was a lot of money but after all these fuckers get through rifling my pockets it's a lot less. I can live on what they let me keep but don't think I'm happy at getting raped. My ass is sore and bleeding and I fucking hate those cocksuckers in DC....both sets of whores, Repukes and Dumbcrats.
...and its equivalent called avoidance as well. Perhaps the US could do so more aggressively(read: go international) and allow regular citizens to help.
Regardless of amount, purposeful evasion/avoidance shows contempt for a country and its constituents. That is, it makes you quite close(and blatant offenders like FB/Google already crossed it) to falling on the wrong side of the enemies foreign and domestic phrase.
If you want to be on the wrong end of a very capable and effective hyperpower(the US), do not be surprised when it(and its citizens) acts against you. You're free to become a terrorist, but not free to evade the consequences of your choice(which is the primary goal of tax avoidance/evasion, consequence evasion).
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
The problem to your solution is that you need to legally define "offshoring profits". You see, these systems get set up by lawyers in such a way that they are legal.
The solution, of course, is to pay taxes on revenue, not on profit.
But frankly, taxes are so heavily skewed towards corporations that I've thought about creating a company with the business purpose of running my life, only so that everything I do can be tax-deducted.
Assorted stuff I do sometimes: Lemuria.org
tax avoidance is wrong... blah, blah, blah
So, are you willing to go on the record claiming that you personally pay more taxes than you have to (for the good of society)?
An appocryphal quote comes to mind: Don't hate the player, hate the game.
the police are obliged to protect your personal property and your life
No, they're not. Numerous court rulings, all the way to the Supreme Court, make it clear that the police have no duty whatsoever to defend you. Lots of them are nice guys and will if they happen to be in the right place at the right time, but they have no obligation to do it, and many of them won't.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
Some folks wish they got a lot less from government.
How about the IP laws that seem to let these companies make all this money and/or let them fiddle the books so they pay almost no tax? The only reason a lot of these companies have such large profits is because our freedoms are restricted to let them do so. This is part of the social contract. We collectively agree to have our freedoms restricted in order for companies to make money. This lets them generate employment and contribute to public services through their taxes.
It seems to me that these companies simply want to have it all: restricted freedoms for us and they make off like bandits without contributing some of those profits back to society. Not everyone agrees that the amount they are expected to pay is fair but likewise not everyone agrees with the freedoms we collectively give up. However what we seem to be getting is increasing demands to give up more and more freedom so companies can continue to make money while the same companies are using legal loop holes to dodge the social contribution part of the bargain. If we carry on in this direction it will not end well for either us or companies.
Unfortunately - here in the UK we have the same problem... the people pay more while the corporations pay next-to-nothing
This is a complicated issue in my mind, I'm conflicted. One the one hand, my thought is that as long as we're going to tax corporations, we should do so effectively, limiting/eliminating the tricks that international companies use to avoid taxes like this. Note: To me tax avoidance is using legal means to lower your tax burden. Tax evasion is using illegal means. Using the former is shady, but not illegal, and we should expect companies to be immoral when it comes to saving millions of dollars.
But I also have the thought of 'why bother taxing corporations'? We suck at it, and ultimately companies are owned by individuals, everybody from fat cat industrialists to the retired grandmother who bought $100 of IBM stock 50 years ago. That makes taxing corporations both regressive and ineffective - it's regressive in that it hits those who have low incomes and low amounts of stock(mostly in retirement accounts) as much as it hits the rich. Ineffective in that the big companies have all figured out how to shelter the vast majority of their profits legally. It's the small to mid sized companies that are handicapped by actually having to pay the high US taxes.
Maybe make the corporations collect sales tax instead? What about VAT? Maybe put proper tiers on non-earned income(IE capital gains)?
My idea is to split personal income taxes into two categories - earned and unearned. Earned is salaries, piece work, etc... IE you 'did' something to earn that money. Unearned is capital gains, interest, dividends, and such, money earned from the simple fact that you 'owned' something. Your first ~$10k of income in either category is taxed at 0%, after that it's tiered in parallel like the current system. Assuming an average return rate of 5%, that's $200k in investments before you start having to pay taxes on the return, which is a good amount for emergencies, college, early retirement, and what not.
If you make as much as Romney though, you're going to be paying near the top rate, no matter how you structure your income.
I don't read AC A human right
How about we just close the loopholes? If you have a US based company that is clearly operating a subsidiary, that subsidiary (even foreign) will be subject to US taxation. Far simpler strategy.
You miss the whole point of the story. This story isn't JUST about US tax being avoided.
paid Irish taxes of about $4.64 million on its entire non-U.S. profits of $1.344 billion
The problem here is that Ireland offers ridiculously low tax rates to attract investment and employment.
They realize that the spending and the taxes Ireland gains from income taxes and sales taxes paid by the employees and the jobs that are created helps Ireland more than the corporate tax. So they set crazy low rates cor corporate taxes and Facebook and Google set up data centers there.
I'm hard pressed to declare this a totally bad idea. If it works for Ireland, good for them. If it works for Facebook and Google, how can you blame them for doing exactly what the law was set up to encourage?
The US can fix their tax laws too. They could easily make it more profitable to keep the investment mostly at home. Irish tax and legislation isn't exactly secret sauce. Washington State gives Boeing and Microsoft and Amazon astounding tax breaks just to keep its citizens employed. So do a lot of other states.
Side note: There is a school of thought that says taxing corporations is counter productive, and taxing the compensation AND THE PERKS of people that work for the corporations makes more sense. (Lets not start the corporate owned cars, planes, yachts and houses rant m'Kay? I said "compensation"). When you get right down to it, the reasons corporations are taxed is to gain some measure of government control over them, not to gain any real tax revenue that would not otherwise be collected from shareholders or employees.
Sig Battery depleted. Reverting to safe mode.
Greece is a perfect example. Also, take a look at the French revolution. Why did that happen? Because the peasants had no bread.
I like to pay taxes
I take it you routinely decline all of the deductions you're eligible for, come tax day?
The REAL question is why hasn't this enormous loophole been closed yet?
Because the companies are willing to spend millions lobbying politicians to make sure it isn't closed, and as most politicians own substantial amounts of stock in the companies doing this, closing the loopholes will cost THEM money.
I don't read AC A human right
You can use the United States as a prime example. I'm not here to do the job of educating you, we have complimentary public schools for that. Since you couldn't be bothered to participate in your education, then you can just research crime rates in the US.
Also, since you couldn't be bothered to participate in your education, you can research the Roman Empire and its welfare system and the reasoning behind it.
In addition, since you couldn't be bothered to participate in your education, feel free to research communism and the reasoning behind it.
"I don't want more choice, I just want nicer things!"
-Jennifer Saunders as Edina Monsoon
Also, how about military ships patrolling trade routes to deter pirates?
But to argue that we should pay zero taxes make NO SENSE WHATSOEVER.
You should look into the history of income tax in the United States of America.
You will find that we got along JUST FUCKING FINE (sorry I had to mimic your use of caps) before the American Civil War, during which income taxes were first imposed.
Yes, import tariffs is how the fucking government used to get most of its funding.
I'm sorry I had to resort to caps and expletives, but you cocksucking SHILL FUD'sters are fucking SHILL FUD'sters.
I agree we can't undo the welfare state overnight. The problem is that we give people incentive to have children they can't afford. Stop paying for more children that will have even more children that will also end up on Welfare because it's all they ever know. I don't really blame them, if I'd grown up under that system I'd no doubt fall right in with the path of least resistance too. I blame Lyndon Johnson and his stupid "Great Society." What a load of crap. He and others created this problem and now we're going to reap the pain.
Citation needed.
"I don't want more choice, I just want nicer things!"
-Jennifer Saunders as Edina Monsoon
He might be including medicare expenses in there, even then it'd only be the most expensive retirees getting $300k worth of medical benefits a year.
I don't read AC A human right
Could you please try explaining that again in a way that makes sense? I have no idea what you're trying to say here.
Where would you like the populations found within these population centers to go? Did you want a few more neighbors in your rural backwater? I thought the rural folks were already up in arms about losing their land to suburban sprawl.
Two of my imaginary friends reproduced once
I don't mind paying for that. I think everyone should pay a fair tax. Until the tax system is fixed so these loopholes are gone that will never happen. The working stiffs will continue to foot the bill for the welfare state while the Mitt Romney's of this country hide their money in the Cayman Islands.
contractors are not included in the official headcount yet for all intents and purposes they are govt employees. And they are not cheap.
It's simple - see through the bullshit and judge the size of the govt by what it spends.
Company is abstract construct. Company doesn't care about anything, it is the people that are controlling it. When we say Google did this or that, it means people in Google in the name of the company did this or that. When people in Google decide to destroy it, the company won't fight back. When the company has the money, nobody benefits from that and thus there should be no tax from that money (inflation is good enough).
I like to pay taxes, with them I buy civilization.
Please feel free to hand your entire paycheck to the government. There is no law stopping you. It will make you much happier knowing that you are getting much more civilization than your neighbor.
I suspect, however, that you really mean that you like the concept of taxes paid by others because it pays for the control over them that you appreciate (and that you call "civilization").
That a lot of deluded "rugged individualists" falsely think they are entirely self-made and have no obligation to pay back into society amuses me.
I have an obligation to pay back into society that which it asks me to pay and I have agreed to. There is no EULA or "shrink-wrap license"; no unilateral contract. If "society" wants to promote home ownership and does so by creating tax deductions, then I will use them and feel no sorrow at paying less in taxes. Ditto for energy-efficient appliances, weatherization, charitable donations, etc. If the sum of the deductions meets or exceeds the "tax liability", then why should I have any obligation to pay at all? After all, society has told me what it expects; I have met that expectation.
This same concept applies to corporations. Obeying the laws and paying what is owed is their obligation; paying extra because you want "more civilization" isn't.
Seeing them frustrated and resentful at paying taxes makes me smile.
Why would anyone be resentful at having to pay for things that you think they should pay for but they don't? How silly of them. And isn't it such a wonderful feeling of accomplishment when you can force them to do so, and feel superior to them at the same time?
This is perfectly acceptable.
You seem to be stating that having a company 1% in the USA is better than a company that's 0% in the USA. This clearly isn't true when the company in question is raking in 90% of it's money from the USA, and giving virtually none of it back. They soak up our real estate and resources. I'm sure a company that pays tax on 100% of its revenue would do a lot better for the USA in that plot of land than one that pays tax on 1% of its revenue.
Let the tax evading bastards evade their taxes and fuck over the economy of a different country. Let the entire operation and everything regarding it run out of the Cayman Islands. SURELY those running the country will look kindly on this big, massive organization giving nothing back to the government, and no blood will be spilled by anyone corrupt.
That also puts the grandparent poster's real name(which is NOT Anonymous Coward) on a quarterly published list of people that have denounced their US citizenship. That, and it aggressively values assets to maximize collections(arguably it should include a few years back to discourage strategic transfers).
I would not be surprised to see that used to track where prominent denouncers, such as the traitor Eduardo Saverin, go and what they do.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
You are thinking of a company in a vacuum. A simplistic construct in a gedankenexperiment, that owes nothing to the society and laws that allow it to operate.
In short, your argument stinks.
--
BMO
They can be justified, just not by ethics. They are justified by force.
"His name was James Damore."
Maybe a simple solution is to not tax corporations income at all and to pass the taxable income to the owners of the corporations like a partnership. If you own 10% of the company, then you must claim 10% of the net income on your personal taxes. If you own .0001%, then you claim .0001%. In this modern age of computers, corporations can issue 1099 statements with your weighted average share of income.
Doing so treats corporate income like any other business income for tax purposes and dividends just become a return on capital investment. The downside to all of this is that some very wealthy people won't be able to shelter their money in off shore corporations any more because they will have to claim it as personal income just like a sole proprietor or partner.
What about the invasion of Iraq?
It certainly wasn't because of WMDs. Obviously the reason was economic. For who? Well, that's a bit more obscure, but it certainly wasn't about the defense of the US.
--
BMO
sure but if you want to convince anybody, you shouldn't mention global bullying as a beneficial way to spend tax revenue. That won't win you many allies.
When talking about income taxes, yes, you are member of the society, you benefit from such things, you should pay taxes. Companies, however, don't benefit from army, from healthcare and from any other things that society provides. In fact, when nobody uses the company, the company ceases to exist. Taxing the companies only forces the companies to spend every year the most so they don't have to pay such high taxes. For me, it is not bad if for example Microsoft holds great untaxed amount of cash this year and invests it the next year or the year after. The company is already punished for not spending their money by inflation, the income tax is just bad tool and shouldn't be used.
Complete bullshit across the board.
Example: Halliburton rebuilding the Middle East
I work in the Healthcare analytics world, a healthy population has a DIRECT correlation to higher productivity from your workforce, ergo higher profits. This is why companies track Health and Productivity Management and implement programs designed to change employee lifestyles to be more healthy.
Drop the corporate shill routine that companies don't benefit from the government. They benefit a hell of a lot more than most citizens and at a lower effective tax rate.
I'm a mix of Bin B and C. I go downright socialist in the sense that because I believe in Keynesian economic theory, I think that the government should shift between deficit spending and a surplus in counterpoint to the private economy. Ideally this should be set up to be as automatic as possible.
Combined with our not being willing to let people starve in the streets, not wanting people in prison to have better lifestyles than those out of prison, etc... I think that we should have a sort of universal employment option instead of most forms of welfare. Call it the 'Federal Jobs Program'. It'd be a typical government job: Low on pay; high on benefits. I'd try to keep it paying slightly less overall than private jobs in the same category. Meanwhile it provides medical*, training(technical, OJT, and college), perhaps even food and housing. I'm picturing how we used to treat junior enlisted in the military - eat at a dining facility(where junior enlisted to most of the work), live in the dorms/barracks, family housing for the married. Anyways, haven't even addressed what I'd have them do - which is mostly 'build infrastructure', which to me is anything that should still be in operation and providing benefits 20 years later. Roads, bridges, schools, parks, government buildings, etc... Heck, maybe even put them to work putting solar panels on people's houses in areas where it makes sense. Running fiber. Helping to set up a community cooperative internet provider. To try to keep private businesses from using it to get their projects done cheaper, I'd require all infrastructure to pass in to the hands of a cooperate(IE customer owned)/not for profit, not a for profit business. The details would fill a book, of course.
The trick is that when deciding whether a project would be profitable, you deduct the welfare we'd be paying the worker otherwise if they weren't working. So with laber discounted something like 50%, you can now, on paper at least, have a lot of projects be profitable/worth it if it wasn't for the otherwise high cost of labor.
*Until we get some sort of universal system set up; as a libertarian I find the idea of your job providing your healthcare abhorrent. You should be getting your own healthcare insurance INDEPENDENT of your job, outside of military/professional sports and such.
I don't read AC A human right
I don't see any arguing, I see a statement of facts. The U.S. government does not have the constitutional powers to legislate local law enforcement policy nor legislate any other matter having local jurisdiction. Ironically, U.S. citizens traditionally look to the federal government to ensure liberties, equality, and welfare even though local governments, not federal, have the jurisdiction to do anything about it.
Two of my imaginary friends reproduced once
There's a difference between supporting the troops and supporting the military complex. You have to be careful about the lines drawn.
Getting our troops out of Iraq, Afghanistan can be supporting the troops while not supporting military industry/spending. Lowering overall military numbers gradually while increasing pay can be supporting, etc...
I don't read AC A human right
You know, I only mentioned that the US's dependence on military superiority for economic stability, but it's hardly the US that does it.
Everyone does.
Why the hell do you think the Danes and Canadians send ships and planes to the arctic to argue about what island is Danish and what is Canadian?
"Global bullying" is done by everyone.
--
BMO
no more retirees getting 300k/y off the rest of us
Citation required.
Two of my imaginary friends reproduced once
These charges are known as "Transfer Pricing."
And a small government will be any better at collecting taxes from big corporations?
Sure they'll need to collect less money, but don't expect them to lower taxes for individuals. Less funding for the IRS will just lead to even more corporations implementing similar tax avoidance schemes, since the chance of being audited will be near zero.
And since there will be more money left over, our corporate overlords will be able to bribe even more politicians (well bribe each of them more).
Big government means and has always meant big in terms of budget. It has nothing to do with number of government employees.
Outsourcing a government employee does not reduce the size of the government.
As an individualist I'm certain you will feel quite at home away from us collectivist apes were you to transfer your residence to Somalia.
Two of my imaginary friends reproduced once
They why is this a problem? If they are paying what they are legally obligated to pay, then why should they be forced to pay more? Who's the authority on how much more they should be paying? Why should they pay more? Ethics? Does that mean there is an ethics tax now?
If we don't like how companies use the laws that are set up, I guess we know what we need to do, don't we? Make laws that force companies to pay what we feel is justified. Just don't be surprised by the outcome.
Mod me down with all of your hatred and your journey towards the dark side will be complete!
Does this mean that the people who pay no income tax should be held to the same standards? If so, I'd vote for it. No more "ObamaPhone", no more public education or police protection for deadbeats, no more food stamps for people who do nothing more than produce more mouths to feed... I'd be happier to see those fucks go too.
But I'm sure you'll have some bullshit excuse for those fucking leeches. At least a company hires people, that's jobs. The welfare fucks are like a cancer.
insure yourself so you won't have to sell your property for peanuts when it's already on fire - problem solved.
it's in the interest of insurance companies to lower the impact of fires and some even fund their own firefighters.
http://www.sfgate.com/bayarea/article/Private-firefighters-role-growing-in-state-3275585.php
If you are really at a 50% tax bracket, you need to do one of two things (perhaps both). First, get a tax adviser and second, consider moving out of New York City or wherever it is that you're getting shafted for on local / state taxes. That's about 20% higher than it should be unless you have some really odd financial issues.
Faster! Faster! Faster would be better!
well the USA is the land of the free and a capitalist beacon, so it would be awfully hypocritical to allow a market economy to prosper and then impose all sorts of rules limiting such a free market just because those who help make it happen figure out ways to get more out of it
It is not in vacuum it is the reality. When I create a company, the company starts to exist. Its money are not my money. When I want to use that money, I have to pay income tax. I'm the one who benefits from the things that society provides. The company does not, the company doesn't care.
I will not repeat this again. If you are going to react to my post, please try to be more specific than "your argument stinks" argument.
Because "-1: insane delusional wishful thinking" isn't an option.
And some folks believe they should get a lot while giving very little.
This is called tax avoidance and is legal, immoral and unjust.
If Facebook thinks 0.3% tax is reasonable than their fire protection should be limited to a tall glass of water, their access roads should be reduced to trampled grassland and they should dispose of their sewage waste using government-provided paper bags.
Slashdot social media options: AIM, ICQ, Yahoo, Jabber and Mobile Text. Why no MySpace?
As an example 15-years ago there were far more government employees than there are know and the national debt was about 3-trillion dollars, yet now in 2012 after all the out-sourcing, and privatizations the national debt is approaching 16-trillion.
The thing that started this began more than 15 years ago. It was the creation of an unofficial 4th branch of government, called private contractors. Not all private contractors belong to this branch, but the ones that do.. oh boy..
They arent called federal employees, but these 4th branch payrolls mainly consists of federal money. When you count these 4th branch employees, federal employment has gone way way up over the past few decades. It isnt just the growth of defense contractors either, as a lot of technical and social services are now contracted out and they are growing rapidly too.
Its actually plainly obvious that this is the case when you consider that spending must ultimately end up somewhere. If spending grows rapidly then the number of people dependent upon federal money for their wage also grows rapidly. Plainly obvious stuff. You've got to get pretty convoluted with your argument before you can hide this truth.
"His name was James Damore."
Stop using Facebook.
"If any question why we died, Tell them because our fathers lied."
I use roads, including both private and public roads.
I depend on regulation from both the government and private entities.
I am, in some ways, a self made man; however, that's not to say I have not relied on others to get to where I am today.
You may think me naive or an idiot if you like. Keep in mind, though, that the government already taxes the income earned by the individuals who work at the company. The company's retained earnings will eventually be taxed when they are paid out in the form of dividends or wages down the line.... or I guess the company could just lay off a bunch of people and hand the money over to the government as a corporate tax now? Personally, I think the money is better off staying with the company and they owe it to their employees and other stakeholders to try and make sure they can continue to make payroll and deliver the goods and services expected of them. If that means taking legal steps to avoid taxes, then that's what needs to happen.
P.S. Your comment made me laugh when it conjured up this image:
http://184.173.194.236/~worm64/wp-content/uploads/2012/05/statistRoadsZombies.jpg
-- Stu
/. ID under 2,000. I feel old now.
TFA was about Facebook not paying very much to Ireland. I have no idea what taxes they pay (or don't pay) to the U.S.
paid Irish taxes of about $4.64 million on its entire non-U.S. profits of $1.344 billion
The problem here is that Ireland offers ridiculously low tax rates to attract investment and employment.
This isn't due to a ridiculously low corporate tax rate in Ireland (it's 10% or more according to wikipedia, depending). The country with ridiculously low corporate tax is Cayman Islands (no corporate tax). Ireland's subsidiary pays licensing fees to the subsidiary in Cayman Islands, so that on paper the Ireland profit becomes miniscule, and thus the tax sums are low too.
Yes. The solution is helping people to be gainful members of society. We all know that.
The problem is that the current right wing philosophy is cut cut cut, with no money to spend "Teaching a man to fish". He just wants to take the fish away and say "Go get a job" when there are few jobs to be had, even for those that are motivated and educated.
I'm not arguing Welfare is good, but it's a far sight better than simply throwing people to the wolves.
If you need web hosting, you could do worse than here
Yes, but part of the reform included spending money on programs to train and educate people. That part is missing from todays calls for "reform".
If you need web hosting, you could do worse than here
facebook is not real - it doesn't drive on roads and it doesn't shit. Employees and shareholders who do these things paid for them with their own taxes.
However, the world we currently live in has few if any countries where the overwhelming majority agree that the bulk of government spending is on important things for the government to spend money on.
Indeed. In America, between federal, state and local governments more than $21,000 per person is spent per year (FY 2012).
Now think how much easier it is for someone that only pays $4,000 a year in taxes to go around not thinking that their tax dollar isnt being greatly wasted.... after all, even if "only" 80% of the money is being wasted, they still get (on average) $4,200 worth of value for their $4,000.... a net win for them.
Its when they turn around and say that the rich arent paying their "fair share" that it goes into the absurd.. The guy paying $20,000 a year in taxes is also only getting (on average) $4,200 worth of value with that same 80% waste.. its simply not possible to explain to this person that their $20,000 isnt a "fair share" because the claim is absurd.
A case in point. We spend more per student than any other country on earth, and what do we have to show for it? Very large amounts of systemic waste, obviously.
"His name was James Damore."
Are we going to have one article for every multinational corporation that uses tax shelters/accounting tricks to avoid paying taxes?
Personally, I don't think what they are doing is "morally" right - but then again, I'm one of those morons who don't think that corporations are people. Frankly, I'm not sure why companies pay taxes (specifically taxes on profits) - I think the rate should be 0 percent. The employees pay taxes (from the CEO to the night custodian). Employees pay taxes to drive to work, use facilities, etc.
If they are using land, they should pay tax on that (i.e. physical presence) - just like any homeowner. If they are using electricity, the pay the utility company (and they shouldn't get a subsidized power bill, unless they have an agreement with a private utility company). A company can't do much with money in isolation. It needs to spend it or invest it and pay capital gains tax.
The biggest flaw that I see is that the company starts "gifting" executives cars and accommodation. The employee might not pay tax on it - it isn't bought from their income. The executive is happy - they get "lower" tax rate effectively (since they don't pay for the car/house). But you can't stop companies from having their own vehicles - Fedex can and should own aircrafts. I don't see a clean way to distinguish these cases.
Maybe someone can enlighten me on why companies are taxed, and other flaws with eliminating corporate tax?
so you say no property taxes, which supposedly fund the fire protection, were paid on the HQ building?
http://market-ticker.org/akcs-www?post=215290
I.e. diminishing returns.
The higher you raise corporate taxes, the more inventive ways large profitable companies are going to find to avoid them. So we end up taxing the crap out of small players that can't afford to globablize (and are a small percentage of oerall tax revenue), while the big boys just offshore their financials. If the USA were to lower corporate taxes 80-90% it probably wouldn't be worth the effort for a lot of companies to maintain foreign entities to get the tax benefits. This might make for an interesting economics investigation...
Maritime law dictates that anybody who is aware of piracy has to intervene to stop it if they have the means, no matter what flag the victim flies.
Careful with names containing L slashdot.org/~AiphaWolf_HK slashdot.org/~AlphaWoif_HK slashdot.org/~AiphaWoif_HK
Tax avoidance is not the correct solution. It benefits those with better knowledge of tax law and how to avoid paying. It would be better to simplify the tax laws to prevent the ability to avoid taxes. Then, if the simplified tax laws are bringing in too much money, lower the rates.
>I will not repeat this again.
Stuff a sock in it.
--
BMO
Canada and Denmark have their teritorial waters there, but i don't see them blowing brown people up half the world away or threatening independent states. There is nothing global about their tiny little posturing.
I see maybe 3 candidates that are the real deal (the US, China, Russia) and really the US is in a league of their own. What is it, defense budget equal to the next 20 countries combined?
>Canada and Denmark have their teritorial waters there, but i don't see them blowing brown people up half the world away or threatening independent states.
If they were bigger, they would be.
This is what you don't understand.
--
BMO
You might try introducing yourself before speaking to a complete stranger. I'm not going to read anything more than two sentences without being introduced. I'm just not interested.
It also can't have profits and can't pay taxes - it's a company, not a human being.
So I suggest we get rid of the notion of "companies". It's harmful to society. Instead, let's have the employees and the shareholders responsible for taking the profits and for paying taxes. That'll be a lot simpler, and would require them to actually relocate to the Cayman Islands before they can enjoy the tax benefits.
And if specific employees and/or shareholders find ways not to pay taxes, then the government can find ways to withhold services such as education, health, roads and sewage. Agreed?
And this is what I point at when I suggest flat taxation, and everyone says it would hurt the poor. The poor are already being hurt by the super rich paying almost nothing. I include businesses in this definition of super rich.
wrong.
The government is accountable to the people, when all is said and done,. Money doesn't vote, people do.
We have seen time and time again where the government has fought and one against a multitude of corporation and their abuses.
With strong government regulations, you can limit damage corporations do. With out it it means corporation can do whatever they want. We have seen that. we have seen the results from that, it's not pretty.
The Kruger Dunning explains most post on
Actually, a lack of money doesn't cause crime. Just look at India if you don't believe me, they're quite literally the happiest people on earth.
Indeed, does welfare reduce crime? No, in fact, it actually increases it.
http://www.neoperspectives.com/welfare.htm
Im not so sure about the marriage issue, but I do know quite well that single parent kids are far worse off, and our current welfare and child support laws encourage. Black people are especially bad here, not due to their race, but due to the cultural values (or lack thereof) of most urban black males. It's not society's fault, it's their own fault, but politicians and the media are so afraid of being labeled racist that nobody will speak up about it.
Careful with names containing L slashdot.org/~AiphaWolf_HK slashdot.org/~AlphaWoif_HK slashdot.org/~AiphaWoif_HK
...we're going extinct.
We are?!
“He’s not deformed, he’s just drunk!”
Not if there is no capital. Capital comes from people who are able to defer consumption today in order to accumulate savings to invest tomorrow. And no, government funny money fiat fraud currency systems are no substitute for capital, as their collapse is what we are currently living through. Credit != capital.
XanC was being sarcastic as he quoted Schmidt.
So?
They question is not about taxes. Just saying Lower taxes otr raise taxes is meaningless.
It's don't to create an emotional argument and fear mongers.
What do you get for those services? Do you kniow what it takes to keep a city running? the 1000's of miles of infrastructure?
Safety, etc...
For the record I make nearly 100K, and pay 21% in taxes, all said and done. Minus fuel taxes, I don't want to figure that out. No time, but it's not much. I get about 8 gallons of fuel a week, most weeks.
If my taxes jump to 40%, but in exchange health care an all education was free I would be fine with that becasue it has value to myself, and more importantly, society as a whole.
The Kruger Dunning explains most post on
Nonsense. Facebook drives on roads and shits. When their employees and shareholders are driving on behalf of the company or taking a shit on company time, Facebook's responsible. When they do those things on their own time, in their own cars, on their own toilets, they're reponsible.
If they don't like the benefits afforded by society as a whole, they are allowed to leave. If they're that worried about losing a small amount of money to taxes, then they are free to go find some unclaimed land and protect it themselves.
The US defense budget is over $700 billion [2], which as a component of the overall US federal budget is only exceeded by Medicare/Medicaid and social security [3], and is also equal to the sum of the military budgets of the next 14 highest military spending countries [2], which for a country of only 4.5% of the world's population (compared to China's 19% and India's 17%) [4] is rediculous by any stretch of the imagination.
The US spends more than $450 billion [1] just to service the interest on its debt, which is more than 3% of total GDP [1, 5], and that's with an average debt interest rate of just 2.5% [7] on a debt of over $16 trillion [6]. "As the debt ratio increases, the exchange value of the dollar may fall. Paying back debt with cheaper currency could cause investors (including other governments) to demand higher interest rates if they anticipate further dollar depreciation. Paying higher interest rates could slow domestic U.S. growth." [8].
The debt to GDP ratio for the United States now exceeds 100% [9], which is a position shared by countries also with financial problems like Ireland and Greece. The US may have its own financial printing press, but inflationary pressure will either limit its use or risk total collapse of the US dollar as a global reserve currency in favor of the Euro or IMF SDRs [10].
Anyone who denies that the USA is in deep financial doodoo is living in laa laa land with their head in the sand.
[1] http://www.treasurydirect.gov/govt/reports/ir/ir_expense.htm
[2] http://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures
[3] http://en.wikipedia.org/wiki/File:U.S._Federal_Spending_-_FY_2011.png
[4] http://en.wikipedia.org/wiki/List_of_countries_by_population
[5] http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28nominal%29
[6] https://www.fms.treas.gov/fmsweb/viewDTSFiles?dir=w&fname=12122700.txt
[7] http://www.treasurydirect.gov/govt/rates/pd/avg/2012/2012_11.htm
[8] http://en.wikipedia.org/wiki/United_States_public_debt
[9] http://en.wikipedia.org/wiki/List_of_countries_by_public_debt
[10] http://en.wikipedia.org/wiki/Bancor
OK, so let's all stop paying taxes. Let's see how many days it will take until it looks like Zombie Apocalipse. Really, go ahead.
And does it matter? I think the entire debate falls into the "what is less evil" category, rather than "what is good". I think I have better things to think about.
Corporation also cost society money. SO they shoudl also pay. 20% on the net no deduction except RnD, 30% on any money leaving the US.
I would also tax 100% on all net over a billion dollars.
Put that money into RnD, or hire more people, or get it taxed.
What people discussion economics seem to for get, is that the only way money has value to society is if it is moving.
When you pay a dollar to buy and orange, the dollar is only worth something at the moment of the transaction. In fact, it's worth exactly 1 orange. The orange gets consumed, but the dollar will be a dollar again at it's next transaction.
Yes, yes, I know it's radical idea. Lets all horde are money and watch society crumble. The we can use it to heat out homes as we go back to living in mud huts and afraid of the lightning god.
The Kruger Dunning explains most post on
Yes, society can function with private services, and a lot better.
Citation needed.
pensions in california:
http://www.youtube.com/watch?v=BH91X-5X40Q
You are correct that the tax laws should be simplified, but I am not sure how that would correct the problem of the government spending money on things it should not be spending money on. Our problem in this country is NOT insufficient government revenue. Our problem is excessive government spending.
The truth is that all men having power ought to be mistrusted. James Madison
that is,at best, a simplistic use of work force development, and at worst(and probably) you are ignorant and just spread lies to fit your agenda.
http://en.wikipedia.org/wiki/Workforce_development
The Kruger Dunning explains most post on
So, you are against progressive taxation? The rich guy also gets back a lot more from the society he lives in than the other fellows, so why should he complain that he pays more taxes?
I'd LOVE to pay a million euro of income tax every year!
The people primarily hit by higher taxes are regular wage earners. "The one percent" and corporations have many ways of getting around paying taxes, and there is no law that can fix this (short of turning a country into a totalitarian state). That's why it is so fascinating that the "educated middle class" so often votes for tax increases and the politicians that favor them.
I guess thats we birth rates are down.
You might want to get a reality check on that opinion.
The Great Society worked. The money for it has been stripped by the pubs.
I used to be poor. very poor. No one I knew was having more kids for money. Even the most poor not that doesn't make sense. However low education, emotional stability and boredom can lead to more sex.
The problem we have no has NOTHING to do with Lyndon Johnson. A bunch of banker and financial 'experts' from around the world at the largest institutions lied, cheated, and stole. THAT is why we are in this mess.
Had Greece(and the world) been given correct data, they would not be in this mess. Note that countries with strongly regulated financial system weren't hit that badly at all. Countries with good education and health care system. The impact they did feel was do to the country with not so well regulated financial systems being hit.
It's the same thing. Every financial scandal that impacted the economy at large cause the pubs to scream 'it's the social program fault' and never at the actually liars who created the mess.
no no, all these problems are becasue poor people have kids.
The Kruger Dunning explains most post on
And they should not be able to use any backbone paid with tax dollars.
The Kruger Dunning explains most post on
The problem with your argument is that you assume that the ONLY way these things can be provided is involuntarily by government via taxation. There is no basis for asserting that this assumption is valid. Thus, your argument is void.
Corporations pay lots of taxes, but they are mostly local taxes (e.g., on property) and state taxes (e.g., on sales). Those are incidentally also taxes that go to services corporations actually need and want from their community. They pay even more taxes indirectly through personal income tax, because they need to adjust their salaries accordingly.
What corporations are avoiding is federal taxation. They can do that because there is really very little they get for high federal taxes.
And there is little governments can do about it. We've entered an age where corporations (and increasingly individuals) look at nations like shoppers look at products: cost, service, and performance. Politicians better get used to it, because there is not a whole lot they can do about it.
So people get taxed at the point of earning, but companies get taxed at the point of spending? Why is that?
I suggest amending the definition of a company so that it cannot own any assets (nor be liable for anything). Get the shareholders and/or employees to own the company, pay taxes at the point of earning, be directly liable for the company's actions etc. That'll solve many problems, and once that's done, I will see absolutely no reason to tax companies (because they will not earn anything and not own anything).
And I'm sorry, but I don't buy the argument of "do you prefer that employees lose their jobs?" Many companies have folded and many people have already lost their jobs - having the abstract concept of a company doesn't guarantee anything. The concept was invented to allow people to invest in an enterprise, enjoy the profits and let it sink if it needs to (instead of the owners being directly liable). It's a great concept if you want humanity to take risks (on which progress depends), but it does have a price.
"Its when they turn around and say that the rich aren't paying their "fair share" that it goes into the absurd."
no, it isn't. You just don't know what fair share means.
Hint: the more lopsided that holding of money is, the more the the people with the most wealth have to pay to be fair.
SO when 10% if the people hold the most wealth, their percentage will go up to maintain the same level of services.
It's not a direct numbers game.
The Kruger Dunning explains most post on
Well, when a fire erupts at the Facebook HQ, simply don't send the firemen when Facebook calls and tell them to contract a private firefighting company. They will have the fire put down by that company and will simply pay an invoice for the services rendered. :-)
Actually, this is exactly what used to happen before (roughly, and depending on where you live) the early to mid 19th century. The earliest firefighters in modern times were either volunteers or employed on a private contractual basis (ie they would literally turn up at the scene of a fire and try to negotiate payment before putting it out). As insurance developed in the 17th century, naturally insurers started to provide their own firefighters to reduce the losses sustained to fire. The insurers in London, for example, set up a system after the Great Fire of 1666 whereby each had their own group of firemen and they placed "fire insurance marks" on each house so that they could identify whether their unit was supposed to fight a particular fire or not. Eventually the usual pressures of commerce meant that these units usually merged into a single unit covering the whole of London across multiple insurers in the early to mid 19th century, however, still under a model of privately funded provision.
What happened next could be viewed as an example of "corporate welfare"... the insurers lost large sums in a few particularly bad fires and they decided as a result of this that they would lobby the government to provide a beefed-up firefighting service at taxpayers' expense. At the same time, there was a growing movement to "profesionalise" the remaining voluntary provision in other parts of the world which led to them becoming paid rather than voluntary. Following the model set in the insurer-led markets, these areas paid their firefighters out of the public purse.
I would suggest that it seems the right thing to do to fund fire defence by extracting the costs directly from insurers on an incident basis rather than simply relying on general taxation - i.e. if my house catches fire, my insurer would then have to pay the government back the cost involved in calling the fire brigade out (you can argue about the corner case of how to deal with people who are uninsured and whether you fund their costs from general taxation, a levy on those who are insured, or by trying to pursue them individually). One benefit is that the insurers then have even more incentive (beyond just the threat of loss) to ensure that fire prevention measures are adequate. You could also compare this to the idea that the court system should be self-funding through filing fees etc. Just because it's a legitimate use of a government monopoly, doesn't mean it has to be funded through general taxation.
"If we didn't have these services provided by government with all the associated graft that makes them more expensive than they need to be
HAHAHAHAHahaha. wow.. simple stupid.
The Graft is US government is tiny, tiny, tiny amount, and the risk for doing so is huge.
Graft in private corporation? it's huge. The penalty for doing so is nearly non existent.
I hope those Facebook fire dept travel on Facebook roads, over Facebook gas lines, and Facebook water lines, and Facebook sewer lines and got contact from the Facebook phone. and be prepared to pay for anyone time the inhibit and that the chemicals and smoke never leave Facebooks property.
" then that is exactly what Facebook would have done before a fire started. "
maybe, maybe not. I have seen a lot of companies skimp on needed servidces to save a buck today.
Server backups? naw too expensive right now(i.e. will impact bonus). Redundant power maintenance? naw it will be fine for now.
And many more.
No one is an island.
The Kruger Dunning explains most post on
This is also for people. Of course the companies that own the ships traveling in that area are profiting from such protection, BUT - once again, the companies are just people, the shareholders, management, employees - those people benefit from the protection from pirates. The company as a juridical person doesn't care.
Another example would be: If I have company and the company and this company generates some profit. As long as I don't withdraw the money from my company, I can not use the money. The company can reinvest the money (before the end of fiscal year) and pay no taxes, or save the money (during the end of fiscal year) and pay the taxes. Even if the state for example by protecting its ships increases its profits, nothing changes, the money is still stuck in my company. If I want to collect my profits, the money will be taxed by income tax, otherwise my company will reinvest the money in some point in the future (inflation is the force causing this and is strong enough).
When I state it as simple as possible, income taxes are just forcing companies to reinvest their profits the same year and don't save anything for future.
How about we just close the loopholes? If you have a US based company that is clearly operating a subsidiary, that subsidiary (even foreign) will be subject to US taxation. Far simpler strategy.
You miss the whole point of the story. This story isn't JUST about US tax being avoided.
paid Irish taxes of about $4.64 million on its entire non-U.S. profits of $1.344 billion
The problem here is that Ireland offers ridiculously low tax rates to attract investment and employment.
Somehow when employees are forced to compete for jobs, its okay, when companies are forced to compete for marketshare, thats okay too, but when goverments/countries are forced to compete to attract international business, politicians scream bloody murder.
How about we just close the loopholes? If you have a US based company that is clearly operating a subsidiary, that subsidiary (even foreign) will be subject to US taxation. Far simpler strategy.
You miss the whole point of the story. This story isn't JUST about US tax being avoided.
paid Irish taxes of about $4.64 million on its entire non-U.S. profits of $1.344 billion
The problem here is that Ireland offers ridiculously low tax rates to attract investment and employment.
You hopefully do realize that this amounts to a taxation rate of 0.3%, which is way below the lowest corporate tax in Ireland - 12.5%.
This is not simply an issue of placing HQ in a tax haven (within the EU) - it also requires an ample dose of transfer pricing. Whether this is a "moral" action or not I'll leave for others to decide (I personally believe that the practice should be outlawed), but it is not a case of simply following national law.
I'm not sure if it would help reduce spending by simplifying the tax code. It would make it harder for politicians to pull misleading values out of the tax code (like the effective rate some corporations pay) and push the focus on to the actual spending of the government.
Job creators won't have any capital if they're not being paid enough to accumulate anything let alone spend. By this, I mean the low wage workers. Believe it or not there is a huge swath of this country that lives borderline poor and works full time. With little or no opportunity for advancement regardless of what they do. These people pay taxes too.
C|N>K
>The purpose of our military is not supposed to be to protect our economic interests...
But that's the point of most militaries.
--
BMO
You are absolutely right, that's exactly the purpose of a corporation. It's allowed to exist because this lack of responsibility (or the ability to take on risks that are too great for individuals and groups) is seen as a positive. But this shouldn't give corporation the right to do whatever they want, which is what currently happens in some cases.
This puzzles me. Does this mean that if I call my local police to report somebody (unlawfully) breaking into my home, the police are not obligated to respond to my call and defend me from criminal attack?
Correct. They have no legal obligation.
Or to put the question another way, why do the cops bother to come when I call 911, if they have no duty to do so? It's been my experience that they do respond.
Well, it is their job, and if they do it badly enough the voters might get upset and replace the police commissioner/chief/sheriff. But if they choose not to come help you or, if as is more likely, they come and decide to wait outside until they're sure the situation is safe, you (or your remaining family) can't sue them.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
You're thinking of this supreme court case: http://www.nytimes.com/2005/06/28/politics/28scotus.html?_r=0
Even with a restraining order, the police had no legal obligation to respond.
It further encourages companies to move all operations to places with low wage labor. Taxing profit, wages, and cap gains all have purpose. If a company is extracting money from a country, they should pay for what makes that country worth selling to.
Offshoring doesn't change the argument at all. They can offshore whether they pay corporate taxes or not.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
No, but yes and yes.
Jobs are created by consuption (AKA demand). Investiment opportunities are also created by consuption, investiment requires both capital and demand to happen. Jobs only require demand. That's why people have work to do at the poorest places of Africa, and can be without a job at the richest places of Europe.
The problem that you probably are thinking about is that capital enables productivity gains. Jobs that don't apply much capital normaly don't create much wealth. But that doesn't mean the job doesn't exist, only that the people that depend on it (all of them, suppliers and consumers) are poor.
Rethinking email
I think this issue points out the obvious problem: US income tax law--let alone the income tax law of many countries--needs to be MASSIVELY overhauled.
Think about it--why are we having problems like:
1. Businesses incorporating--and often operating--in low-tax countries for tax avoidance reasons? Indeed, look at how many businesses are incorporated in Nevada or Delaware so they could enjoy much lower state tax rates.
2. The existence of "offshore financial center" banks, where both individuals and businesses are placing their money so they can't be touched by the IRS in the USA, HM Revenue & Customs in the UK, and so on. Why do you think there are so many "banks" in various Caribbean island nations, Switzerland and Monaco? Indeed, a recent economic estimate of money sitting in OFC's could be around US$33 TRILLION dollars. (!!)
This is why radical tax reform is needed. For example, the no-loophole flat tax proposed by Steve Forbes in 1996 eliminates taxation on bank account interest, capital gains and stock dividends, which would drastically slow the "offshoring" of businesses and liquid assets for tax avoidance reasons. I'd take it further and replace the income tax with something like FairTax (there is a bill in the US Congress to do this--H.R. 25), which would essentially end all taxation on the process of EARNING money. Such major reforms would put an end to most companies engaging in these practices, helping the local economy tremendously in the long run.
I think he's pointing out that taxes on corporations are just a form of double taxation where the taxation is "hidden" - you see more expensive goods and services, but have no idea what the cause is.
I'm in agreement, and I'm someone who would happily see higher taxes in exchange for better public services, and am as anti-corporate as the next guy. Corporate income tax just doesn't make any sense. Tax sales, tax employees incomes, tax dividends, etc, but the process of moving money around (which is, after all, what a corporation is) shouldn't, by itself, be taxable.
You are not alone. This is not normal. None of this is normal.
It's also true that it matters less to the corporations; with government out of the way they can just do it themselves. As a bonus, they don't need to worry about accountability or similar socialist nonsense.
P.S. Congratulations, your post is the worst technically correct sentence I've ever read.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
it's a not a psuedonym, I've paid for this name. it's a not a psuedonym, I've used this name for decades, and never any other name.
It's not a tantrum, I simply don't debate legitimate issues with strangers.
Which ones? The Red Lion? The Rose & Crown? Fergus O'Fuckery's?
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Making corporations paying taxes on profits is double taxation and should not be done. Rather the profits should pass through to the owners (investors) and then the investors should pay taxes as if that was their earned income.
No, it's single taxation. Corporations are people, remember? And people pay taxes.
Corporations even have basic human rights like free speech (demonstrated through their ability to make unlimited political campaign contributions), so if they enjoy rights as if they were citizens, we should expect them to perform the other basic duties as if they were citizens as well.
Well look down the road a ways. If the problem keeps growing at the current rate eventually the system will break. I don't know when it will happen but sooner or later the money wont be enough. What then? Will blood flow like a river?
"And some folks believe they should get a lot while giving very little."
Righto. So what it sounds like you're proposing is a cost-benefit balance for taxpayers-vs-government, so basically people get back in some sort of essential service just as much as they paid in.
Am I receiving your implication clearly?
Like I say, I can afford it but it pisses me off. I understand infrastructure but I also understand waste and corruption. Still, if they'd just fucking stop where it is I could live with it. No! The greedy fuckers want more and more and more. It's like a meth addict, they can't get enough money. The more they take the more they want.
We can easily reach a compromise between Democrats and Republicans on this matter. The answer? Make guns illegal and get rid of welfare and other entitlements. Then the poor people can't rise up and destroy you, because they can't get guns, while the government is still heavily armed with non-lethal weaponry. (That's me being facetious, for those who cannot detect it).
but they're still actual human beings
Who take money from other human being and promise to pay them dividends at some future time (that's what a stock is -- a right to vote in an entity which promises but does not guarantee future dividends). And that money which they take from those human beings has been taxed at least once (and in many case multiple times).
Any guest worker system is indistinguishable from indentured servitude.
Not gonna convince me that FB are the good guys. Not going to open a FB page anyway. Although kudos to them for getting *one* thing right. They sell information. Creation of that information does not take roads, public telecommunications (the info goes over private networks), etc. Why should they pay for services of which they consume none?
Any guest worker system is indistinguishable from indentured servitude.
Why do corps get to pay tax only on profits? How would you like it if individuals paid tax only on their leftover "profit"?
1. Lower the corporate tax rate, and raise the unearned income rates in response. This fixes the problem with richer people paying an effective tax rate lower than poorer people and makes it less likely that companies would want to set up such complicated shell corps. It has the negative effect of hurting the retirement of anyone that has all of their money in non-Roth investments suddenly subject to the new higher rates.
That's a pretty common solution. I think this one also works and is more novel:
2. Require companies to pay taxes based on the nationality and/or country of residence of the majority of their executive officers and board of directors. The tax rate is based on the income earned by all subsidiaries. This means that Facebook wouldn't have to just set up shell corporations in other countries, they would have to find a board made up of non-US people, and likely move the top executives out of the country, too. And at that point, well, they aren't really a US company any more at all, and it doesn't matter if they pay US taxes on their non-US income. But really I don't think most companies would go to that effort, as that is far beyond their fiduciary duty to their American shareholders. While business is offshore-able, most people still want to live in the same country as their friends and family. I think this can be used to "fairness'" advantage in tax law.
It doesn't hurt to be nice.
Great idea.
You've done the hard part.
Now run out and have every country pass the same law. Post back when you are done.
Sig Battery depleted. Reverting to safe mode.
By your own logic cax avoidance is the right thing to do if you want to force government to do less.
You miss the whole point of the story. This story isn't JUST about US tax being avoided.
paid Irish taxes of about $4.64 million on its entire non-U.S. profits of $1.344 billion
The problem here is that Ireland offers ridiculously low tax rates to attract investment and employment.
Ireland's corporate tax rate is not "ridiculously low" and, contrary to what TFS suggests, Dublin is no tax haven. The Irish corporate tax rate is low by EU standards, but let's get real here: it's a far cry from being at Cayman level.
Let me to requote TFS with a bit more emphasis:
paid ***Irish*** taxes of about $4.64 million on its entire ***non-U.S.*** profits of $1.344 billion
What's the going corporate tax rate in Ireland again? 10%? 15%? Whichever it is, this means that they booked well under $100 million in profits over there. $1.344 billion is the profit booked in the Cayman.
Also, if Facebook is indeed siphoning profits out of Irland the way TFS says it does, I'd be very surprised that the Irish taxman won't eventually knock at the door. EU governments have little sense of humor when they need money, and $1.2 billion for having the rights to Facebook's IP is a bad joke that is virtually guaranteed to be investigated.
There is no obligation to "pay back" for anything to anybody. Every payment is done at the time of consumption.
Take slavery, add cannibalism, and you get roman_mir! The remaining question than is at what point do you consume your slaves? Or is just taking them in considered consumption?
More than that..
Who also said the powerful only understand one thing, violence. They surely only respect actual pressure, not words, not ideals. They don't understand those words, and they don't share those ideals. They are kinda like dogs who got used to sleeping and shitting all over our beds.... we really, really ought to start acting accordingly, instead of wagging the finger and rolling our eyes. I wish it was legal to suggest killing a bunch. But apparently it's only legal to be killed, slowly, and over generations. Well fuck.
It has been business that has demanded government provide roads, firefighters, schooling etc. Business demands socializing these things that aren't cost effective. Insurance companies used to pay for firefighters. Then there was a couple of bad fires and the insurance companies demanded government take care of it. Business wanted cheap roads to move their goods so they demanded government roads. They wanted an educated work force as workers who can read are more productive so they demanded government run schools.
Here we are now, a society geared for socializing infrastructure for the benefit of business and they don't want to pay for it.
https://en.wikipedia.org/wiki/Inverted_totalitarianism
"Modern economics" does not make demands. And the idea that businesses are colluding to produce unemployment is silly. If a businessperson can hire someone that will add more to his bottom line than they cost, all things being equal, they'll do it. But demand for people, especially at minimum wage, is limited. There are plenty of people who cannot add even minimum wage to a company's bottom line: and companies are not charities (or if they are, they still want efficient employees). Already, a clue has been given as to one of the causes of unemployment: minimum wage. If a person is willing to work for less than minimum wage, and they provide over that amount of value, then they can be profitably employed - but that's not legal, so the company and the potential employee loses the value they could have gained (note that nowhere have I stated that a person can comfortably support a family of eight on minimum wage, nor that minimum wage is the only cause of unemployment).
And again, it is not "when a resource becomes short its value rises" - values are individual and subjective. If you fix that to prices rise, it's about right, but the usual term used is decrease in supply (and an increase in demand tends to have the same effect). It requires no conspiracy for there to be no buyer for a particular good or service - or worker - especially at a given price, and again, when a price floor such as minimum wage is in effect, it's easier for there to be a lack of a buyer. If a particular used car commonly goes for $3000 - that is, it is valued at $3000 by knowledgeable buyers, compared to equivalents etc. - and there is a price floor in effect requiring it to be sold for at least $3500, it will not sell as well, and not because customers are conspiring not to buy it to avoid the price being driven above $3500.
Consider Japan, which is very much in the situation of having higher demand for minimum wage (untrained) workers: did they just keep cranking up minimum wage until highschool grads can make the equivalent of $100/hour? No; they invested in robots for things like homecare for their aging population. There is no conspiracy against paying present minimum wage workers $100/hour; it's just about the value they add to the business. Even if there is reduced supply, businesses are not going to be able to pay more than the value gained for any resource, including employees, and stay in business for long. That's even more fundamental than economics: it's basic math.
I'd rather pay and use fair courts, or at least ones that pretend to it and can compete on reputation (hah, government "justice" system) and a protection service that doesn't spend most of its time and my money harassing people for using drugs and passing yet more laws against victimless "crime" to enrich public/pseudo-private prison owners/operators - but that same government "justice" system doesn't let me opt out of its depredations.
I too would like to see someone take you up on this, and since I don't have mod points now, perhaps this response will produce something of a bump.
I also feel compelled to ask you, sir, why you hate roads, want your house to burn down and/or be attacked by roving barbarians/British troops, and prefer to eat food which would indubitably kill you and everyone you have ever met instantly were it not for government food inspectors (blessings and peace upon them for-ever)?
I still wonder what's good about corporations paying taxes anyway.
Wouldn't it be more beneficial if they didn't pay taxes?
So, if corporations didn't have to pay taxes. They would hire more people or pay them more. Those additional hires or higher salaries will then be taxed again. So the Gvt. does get it's money.
The effect is, that corporations won't have to go offshore for the best tax deal and pay taxes there.
So we would benefit a lot more if the corporations stayed here - tax free - but in return hire more people or pay higher salaries.
Example: Halliburton rebuilding the Middle East
PEOPLE in charge of Haliburton profit from it
a healthy population has a DIRECT correlation to higher productivity from your workforce, ergo higher profits
PEOPLE are using the healthcare services ad PEOPLE realize the profits
Roads and other public infrastructures allow your employees to come to work and customers to purchase your product/service.
true, both employees and customers pay for their right to use the infrastructure with their taxes plus property taxes dependent on value dependent on quality of infrastructure are paid on company's real estate
Police and Fire departments help to protect corporate assets from theft and destruction.
property taxes cover that
Legally Corporations are defined as people, only they officially lack the capacity to vote aside from lobbying. However, if you are really going to push the people ticket, then Capital Gains tax needs to be raised to 35% across the board instead of the 15% cap as the investors have the most to gain by corporate operations. The normal workers are actually producing and already paying full income tax on their wages while investors merely front capital with no additional effort.
Haven't you heard? Taxes are for the little guy. The person who can't afford to hire an expert to guide them through an endlessly complex code. The person who can't afford to hire an expert to guide them through an audit. The person who can't afford to hire a lobbyist to badger Congress for tax breaks. In other words, the middle-class American taxpayer. The sucker.
Wow. Wow. Wow.
That article appears to be a textbook example of the old adage "Correlation does not imply causaility". It cherry picks data, then tries to imply a correlation and causation without examining the other factors that affect such data points.
And it's funny, but I work with a lot of people from India, all of them say they are better off her than at home and they all want to bring their families here (many have). If they're so happy, why are they in such a hurry to get out of India?
Crime rates in india are also hard to determine, because reporting policies are different, classification policies are different, etc.. many crimes are simply not reported in public statistics and many crimes are mis-classified.
For instance, Rape in india is almost never reported. It's widely under-reported world-wide, including in the USA, but in countries like India where it is a huge societal stigma (the woman is considered to be at fault in a rape), and where women are considered property (and thus rape is not considered possible in many situations that would otherwise be).
Then, let's not even get into the huge levels of corruption within the police and other law enforcement organizations.
Now, having said all that, India is still probably below the US for crime, but part of that is historical. People have always been poor, for centuries. There is also a relatively peaceful religion in place in much of the country, which helps, as well as the fact that most people grow up in large families that are self-policing, with people living in the same household.. that means that people have a place to live and a large number of people to pool resources.
None of that is true in the US. Plus, weapons are hard to find in India, while in the US there are more guns than people.
If you need web hosting, you could do worse than here
And I'm sure the employees and shareholders that pay taxes have excellent fire protection, access roads and sewage disposal for their own homes.
Slashdot social media options: AIM, ICQ, Yahoo, Jabber and Mobile Text. Why no MySpace?
Well stated. Thank you.
Look where all this talking got us, baby.
No, what I tried to make clear is that tax avoidance may be legal, but it's also immoral and unjust.
What I'm proposing is that companies pay a tax rate that isn't based on setting up shell companies in Cayman islands.
The whole concept of government is basically protection of it's community. Services such as fire brigade, police and wellfare work as insurances. Common services such as roads, waste disposal and even jail are usually paid based on usage in most governments.
Slashdot social media options: AIM, ICQ, Yahoo, Jabber and Mobile Text. Why no MySpace?
Its an open question as to whether corporations should be taxed at all, a question that even economic theory can't agree on.
I can see both sides of the issue.
There is an interesting article on this issues located here http://www.econlib.org/library/Enc/CorporateTaxation.html
The upshot seems to be that the appearance of fairness is the best rreason any one can come up with. The counter argument is that shareholders own the corporation, so why not tax them.
In any event its s fairly good read.
Sig Battery depleted. Reverting to safe mode.
Your post made me smile.
Look where all this talking got us, baby.
Well, actually, if we made huge megacorporations with subsidiaries all around the world unfeasible because of double taxation, it would solve a lot of our problems. It would essentially force those corporations to break up into smaller companies that operate independently on national level. They would still do business with each other but they would have to work in their own interest (and consequently in the interest of national economy), not in the interest of HQ that is on the other side of the world.
This is not the solution at all.
The solution is to completely repeal absolutely every income tax on the books, and then the 16th Amendment that allows what is simple theft by the government to exist. We stopped the draft because it was wrong. We should stop the income taxes because they are wrong, again being simple theft, which is wrong.
The thing to do is to replace the income taxes with the Fair Tax, which taxes new goods and services sold at retail. In that scheme, no businesses are taxed. That is as it should be, since these taxes harm businesses, but we can only tax such businesses if they do business in the USA. That is a great incentive to business to NOT do business in the USA, which they take to its logical conclusion and work to set up their manufacturing operations in foreign countries, resulting in a job scarcity in our country. In short, the income taxes are tearing this country apart, and have been ever since the rest of the world recovered from WW2 and began being able to compete with us. First textiles went to Italy and other places in the 60's, followed by consumer electronics in the late 60's and 70's, followed by great harm being done to steel and auto industries in the 80s, and then great impact to the intellectual industries like software in the late 90's to present as software development went to places like India and Russia. Income taxes in the USA are at the bottom of all of this. Their repeal would get a lot of these jobs to come back to the USA.
Its an open question as to whether corporations should be taxed at all, a question that even economic theory can't agree on.
You keep saying that. You sound like Fox news reporting "the controversy" by stating there are two sides, even if the controversy isn't nearly so contentious. Corporations are people. While they gain the rights and privileges thereof, they should be taxed like it. It isn't an issue of economics, except as a distraction to the massive rights boost corporations get over people. all (or most of) the rights, and none of the responsibilities.
Learn to love Alaska
I've seen papers indicating that taxing the moving of money would remove all future crashes. The crashes happen from bubbles that pop. The bubbles in recent time have usually been based on some manner of money juggling that encouraged more juggling. Like Enron, it wasn't about profitability or sustainability, but about revenue. You can't sell at a loss and make it up on volume, but there have been companies who did that long enough that the revenue numbers were high enough to get bought out, then crash (AOL managed to buy Time Warner with worthless stock). If you restricted stock purchases to every 30 minutes on trades locked in 10 minutes before the trading moment (randomly matching buyers and sellers of appropriate prices at an instantaneous point), then the nanosecond arbitrage would be gone. With the arbitrage speculators out, stocks would even out in price and fluctuate less. No more booms, no more busts (well, the bubbles would be dampened, people will still have runs on tulips). Another way of doing it would be small charges on moving the money. With the flow of money being more restricted, the arbitrage opportunities would be reduced. Investments would go back to being investments, and not opportunities with traders with direct links to steal from investors.
Learn to love Alaska
The counter argument is that shareholders own the corporation, so why not tax them.
They do.. the problem is their "income" isn't usually all that great. I doubt the check Zuckerberg cashes at the end of the month is more than a couple times more than mine. (Heck, maybe less.. depending on his day-to-day spending habits and how much he can avoid charging directly to his personal accounts.)
Of course on paper he probably makes more in a couple minutes than I do in a year, but as long as its all just tied up in share value, he doesn't really have any "money" as far as taxation is concerned. He'd be hit like a truck with taxes if he randomly decided to completely cash out one day.. not that he has any reason to do something like that.
I can think of an obvious solution to that problem -- consider share increases as taxable income.. but I think we're a century or two too late for that to go over very well.
when goverments/countries are forced to compete to attract international business,
You are so naive it's almost funny.
You think that all those countries are "competing" for business, so all the $1.3bn of business goes to Ireland?
It doesn't work like that. The company gets that business from all over the world and does business in many countries. Ireland isn't winning business. And a company wouldn't give up on something the size of France or Germany basically ever.
SJW n. One who posts facts.
no, it isn't. You just don't know what fair share means.
You say that, but you never justify it...
Hint: the more lopsided that holding of money is, the more the the people with the most wealth have to pay to be fair.
Yes, but they already pay significantly more. Until you explain why the amount that they are paying isnt a fair share, all you are doing is claiming without justification that it isnt a fair share.
Lets go to the numbers (2009 figures from the Congressional Budget Office), broken up by quintile:
Lowest quintile pays 0.3% of the federal tax burden.
Second quintile pays 3.8% of the federal tax burden.
Middle quintile pays 9.4% of the federal tax burden.
Fourth quintile pays 18.3% of the federal tax burden.
Highest quintile pays 67.9% of the federal tax burden.
Now you might start trying to claim that they make sooo much more than these numbers indicate, that the ratio between their income and their liability doesn't also increase in this same progressive manner... but lets look at the numbers from the same source, the congressional budget office:
Lowest quintile averages $23.5K in income.
Second quintile averages $43.4K in income.
Middle quintile averages $64.3K in income.
Fourth quintile averages $93.8K in income.
Highest quintile averages $223.5K in income.
Now lets divide the current share of the tax burden in each quintile by the average income:
Lowest quintile 0.3 / 23.5 = 0.01276596
Second quintile 3.8 / 43.4 = 0.0875576
Middle quintile 9.4 / 64.3 = 0.14618974
Fourth quintile 18.3 / 93.8 = 0.19509595
Highest quintile 67.9 / 223.5 = 0.30380313
To be clear here, thats is their share of the tax burden divided by their share of the income. If the income grew faster than the share of the tax burden, then the numbers on the right hand side would be decreasing.. but thats not the case.. they are increasing.
Now, are you able to justify the argument that the rich do not pay their fair share? As income grows, the share of the tax burden grows even faster, so you are going to have to try a different argument.. one that doesnt simply appeal to the emotions of the ignorant.
"His name was James Damore."
There's this risk in bringing in terms like "immoral and unjust" into any discussion of taxation. It is way too easy for someone else to argue the opposite position upon the same basis.
If you bring in value-for-money arguments like insurance, OK, but then you also ignite the ire of those who point out to what extent governments perform wealth-transfer, where the value of government to some class of entities is net highly negative -- quite possibly immoral and unjust.
All taxes ultimately fall on people. Only people consume economic output, so it's only people control over it can be taken away from to provide government services. Don't fall in to the trap of thinking that taxes on corporations are not taxes on you. Instead of looking at corporations, look at the outcome in terms of what different individuals pay in total, and look at the effect of the tax on behaviour.
The little old lady with her 200 BT shares left over from privatisation pays the same corporation tax on the profits that become her income as a wealthy investor. No tax allowances, no graduation of rates. And the wealthy investor can use corporate shells - offshore and otherwise (trivial companies can be moved more easily than people) - to manage his tax burden in a way often not available to most people. He can, in the UK, earn up to 300k in profits via a company he owns without paying any corporation tax at all, and if he can get his income that way he can avoid the national insurance (payroll tax) that most people have to pay. And, of course, in the US there's the ludicrous situation with capital gains tax rates.
Looking at behaviour, taxes on corporate profits encourage companies to over-borrow and so increase the risk of bankruptcy and the imposition of default costs on others. The returns on loan financing attract much less tax - in the UK just income tax, and so it's much more lightly taxed than earned income or dividends. It also causes economic effort to be wasted in operating tax avoidance schemes - less useful production, more lawyering and accounting. Finally, the ability to avoid taxes like these favours large corporations over smaller ones and new entrants, reducing competition.
Identifying objectively what profits are made where in a corporations with costs, assets and revenues all over the world is a next to impossible task. It's just not a number which exits. Total profit is slippery enough, allocating it to particular jurisdictions can easily turn in to a nonsense. That's one reason why we have the spectacle of Starbucks and Amazon essentially deciding for themselves how much UK tax to pay. What they pay may be obviously ludicrously low, but how, exactly, do you calculate the right number?
Given that corporation tax is pretty much the national insurance of profits instead of labour income, I think it'd be much better to move towards abolishing corporation tax and NI, and raising all that revenue through a single set of income tax rates for all kinds of income. It would save collection costs for governments and accounting costs for companies, as well as addressing the above. Countries should introduce transitional arrangements for pensioners (who paid corporation taxes as they built up their pensions and currently pay only income tax on the income they're getting from it), and should charge an income tax on dividends going to foreigners based on the corporate tax rate domestic countries pay in the foreign jurisdiction. But, in the end, I think it has to go....it's just not tenable as a way to raise tax.
This would be a huge mess to deal with, policing every company and deciding if they are worthy, there will be so many shades of grey on the issue it will be too much trouble to figure out. There are much simpler solutions:
1) Remove all corporate taxes! simplifies the government, simplifies the tax code, reduces company waste of dealing with the tax code. Just image the influx of companies, jobs, and boom to the economy this would be, it is unimaginable. All profit all companies earn is already double taxed, once when the company earns it, and secondly when it is paid out as a dividends.
2) To cover this loophole simply tax the royalties Facebook USA is paying to Facebook Dublin. Is this already the case and the story is sensationalized garbage?
Certain companies, notably those dealing as real estate trusts or energy companies, already do not pay taxes on taxable income if they distribute almost all of it to shareholders within a designated 12-month period. In the case of mREITs, at least 90% has to be paid out, which is done so in the form of monthly or quarterly dividends.
To-do List: Receive telemarketing call during a tornado warning. Check.
The very way campaign contributions work in America, and undoubtedly elsewhere, allows corporations to get these petitions for favorable tax treatment written into law. Unlimited donations via the Super Pac loophole has essentially taken the teeth out of the Federal Election Campaign Act of 1974.
Happiness in intelligent people is the rarest thing I know.
Ernest Hemingway
Except that it would not work that way. It would just result in more shell corporations and a more complicated corporate structure.
The truth is that all men having power ought to be mistrusted. James Madison
With the current tax system - yes. This requires more than just changing one tax, you would have to re-think the entire system.
Assorted stuff I do sometimes: Lemuria.org
I am not sure that I want to allow Facebook to arm its own militia.
The Wise adapts himself to the world. The Fool adapts the world to himself. Therefore, all progress depends on the Fool.
Except individual offices all pay their share of employment taxes, property taxes, and sales taxes for their location... That's what pays for those things, and why local over menus in the US shouldn't give them up.
Income tax is easy to move around. That's why Michigan went to a VAT-based business tax for so any years... Effectively taxing the increase in property value of the parts that went in versus what went out at each factory.. It kept companies from claiming manufacturing "below costs" in one state while the mother ship in Nevada claimed the retail price but didn't pay taxes. Facebook doesn't have a physical place you can pin physical value at, so it's difficult to tax that way.
You could claim Facebook uses Internet that was created by the government as a type of "roads" the government provides. But even then, that backfires because all "last mile" connections are privately owned by companies... They were subsidized but those subsidies work AGAINST the common people. If you tried to tax access it would just provide more corporate control over the little people at the ends.
The government has to turn this around... It's an awfully nice corporate property you got there Steve... I'd be ashame if the angry mobs visited...
A disproportionate amount of people are in prison for "property" crimes. Because crimes that affect PROFITS are punished more harshly than crimes that affect people. That's why murdering, raping and such go free in less time than drugs ... Drugs add liability to the system, and that reduces profits and increases costs. Don't forget all the crazy laws affecting robbing Banks. (Unless you own said bank) Raping and murdering doesn't really affect corporations, so they don't lobby for much more punishment.
What you miss is that the quintile is not at 20, 40, 60%... They are at more like 25%, 75%, 90%, 95%. The quintile used divides by slice of pie... So taxes from 100's millions at the bottom equal the amount the 1% pays. That's why the 1% is taxed at 15% for capital gains.. (The vast majority of the top 5% doesnt even get "wages", they are living off interest) While the middle is taxed at 28% on wages.
Is that Facebook is finally making a profit.
Corporation also cost society money.
I'm not sure of the intended meaning here, but certainly corporations costs resources (because it takes people's time, physical space, etc., to do all the paperwork, accounting, shareholder meetings, filing and so on). Those costs fall on the individuals involved, some mix of customers, investors, employees and so on.
SO they shoudl also pay.
Which is the same as making individuals pay. Corporate vehicles are proxies for people. An equivalent tax on those people, if it could be calculated and devised, would be no more or less fair than the tax on the corporation. But, of course, incentives have to be considered, too, because taxes always change incentives and behaviour.
I would also tax 100% on all net over a billion dollars. Put that money into RnD, or hire more people, or get it taxed.
Why do any of those things if you're not allowed to keep any of the benefits? It destroys the incentive structure (whilst creating an incentive to split companies in to little pieces).
What people discussion economics seem to for get, is that the only way money has value to society is if it is moving.
Money has value only as a control mechanism - because it allows coordination not otherwise possible. It's output (and leisure, and the environment, etc.) that has value. Not all movements of money have value - if we gave each other $10 all day long, moving it back and forth, no value is created. The same with taxation, welfare payments and payments for second hand goods, like most houses. And, of course, not all creation of valuable output is reflected in the movement of money.
When you pay a dollar to buy and orange, the dollar is only worth something at the moment of the transaction. In fact, it's worth exactly 1 orange. The orange gets consumed, but the dollar will be a dollar again at it's next transaction.
Yes, the value to an individual (rather than a whole society) of money is defined by what you can buy with it. As such, all prices, including salaries, are relative. And the $1 in your example forms a part of economic output measures. Money (and the markets and structures governing its movement) has to do a lot of things at once, though - coordinate production, distribute information, determine distribution and set incentives, mediate exchanges that happen over periods of time, and so on. That's one reason designing taxes (and any economic policy) is hard....you can't control distribution (fairness) separately from decision making (incentives).
You forgot wanting to force children to work in the coal mines with no pay or education, and wishing to see piles of dead bodies in front of the doors to emergency rooms because they didn't have any cash on them to pay for treatment.
This topic doesn't just provoke strawmen, it provokes entire straw block parties.
"Suggesting no corporate taxation is not the same as suggesting no taxation."
True. But suggesting corporations do not benefit from the services supplied by government, and therefore have no obligation to help pay for them, is ridiculous. That's the implication of advocating no corporate taxation.
You apparently failed to read beyond the first line of my post.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
If done right, more shell corporations and more complicated corporate structure should also mean more tax burden, not less. That's the direction we need to go.
You're thinking of this supreme court case: http://www.nytimes.com/2005/06/28/politics/28scotus.html?_r=0
Among others, yes.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
Best comment on libertarians EVER!
You are welcome to contribute to government treasuries any amount you like. Don't expect your neighbours to be quite so cheerful.
According to that gang, the "fair share" from a rich person is always "more, more, more".
They do talk a good game. The "patriotic millionaires" were so patriotic about wanting to pay extra taxes, that all of their voluntary contributions, plus that of every other US taxpayer with similar inclination, is coming to apprx. $3 million for the whole year. Pretend-crediting that amount solely to the ~200 self-identified "members", that's $15000 of generosity per patriotic millionaire. Gee, thanks a lot, guys.
Resolution 1441 was based on absolute lies by the Bush administration, and Colin Powell was *used* as a *stooge* to *lie* to the UN. He has since recanted the WMD stuff and has said things like this:
http://www.minnpost.com/eric-black-ink/2012/05/colin-powell-discusses-wmd-blot-his-record
You're an AC because you are repeating the same lies of the Bush idiots.
You're disgusting.
--
BMO
If you won't associate your words with your name, then I'm not interested in reading them.
judging by the scores, it's just you.
What you miss is that the quintile is not at 20, 40, 60%... They are at more like 25%, 75%, 90%, 95%. The quintile used divides by slice of pie...
What you seem to miss is that the data I am using, from the congressional budget office, actually states how many households are in each quintile. You miss this so trivial of a thing because you never bothered to care about the facts.
Lowest quintile - 22.7 million households
Second quintile - 23.6 million households
Middle quintile - 23.7 million households
Fourth quintile - 23.3 million households
Highest quintile - 23.6 million households
What I see here is that the defense of the original theory, that "the rich dont pay their fair share" gets more and more convoluted as I repeatedly wreck a succession of justifications for the theory with actual data.
you have two choices..
1) think of something even more convoluted to try to justify a theory that cant be backed up with data, or
2) look at the actual data, from the source, and realize that you are wrong
Clearly you need to be told where the data is, because you never once cared about the actual data. Hopefully now you WILL start giving a shit about having theories that you cannot back up... you really should be embarrassed. Really.
"His name was James Damore."
"The significant problems we have cannot be solved at the same level of thinking with which we created them." --Einstein
Casteism
As you are no doubt well aware, the Constitution and Federal law are not the only sources of law in the country. Just because the police don't have a Constitutional obligation to protect the public, it doesn't mean they don't have a legal or moral duty to do so full-stop. Most police forces are not Federal agencies, they are State level, and local State laws are the ones that can (or not) define their duties.
Perhaps contract is the wrong word then may be "social understanding" is a better term. Certainly the terms are always open to negotiation. My point is simply that we can view company taxes as pay back for the legal restrictions that allows them to make money. The level of those taxes and the level of those restrictions is always open to negotiation. This requires some give and take. As it stands at the moment companies seem to have avoided paying almost any tax and are arguing for more restrictions so they can make even more money. So I would give companies a choice - either pay tax rate and have all the nice legal protections they enjoy or don't pay any tax but also don't have any legal protections and let them decide which is the most profitable route.
So, you think the way to go is to drive up costs? That will work out well for everyone. /s
The truth is that all men having power ought to be mistrusted. James Madison
http://www.irishcentral.com/news/400-Irish-Facebook-staff-set-for-windfall-several-hundred-thousand-euro-each-as-stocks-go-public---VIDEO-152143895.html?mob-ua=Y
The country goes by the name of Ireland, it's part of the UK.
Sig Battery depleted. Reverting to safe mode.
The way to go is to penalize corporate ownership complexity and reward simplicity. As a bonus, you can do both by removing a lot of crap from tax laws.
I think he means their tribe, "the Individualists"...
That's not social security.
Two of my imaginary friends reproduced once
Sorry, but "where the police are obliged to protect your personal property and your life" is an absolute load of crap. About all they are obliged to do is take a report after the fact. The courts back that up. They can be standing on an adjacent street corner and have no obligation whatsoever to protect you from a crime. Cops are historians.
Please show your working.
Corporations can't just pass all costs directly to their customers. The market will only pay a certain price for given goods or services, and if you charge more it just won't pay. So up to a point you can just pass tax increases on, but if you want to stay competitive some or all of that burden falls on your profits.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
It's pretty simple really. There are millions of people in the UK on Facebook. Facebook makes profit selling their private data off. Clearly much of that business takes place in the UK, involving UK citizens and UK companies all operating under UK law and regulations. Facebook even employs people in the UK, people who are a product of UK society, the UK education system and whose needs are catered for by UK government services.
Yet Facebook, and seemingly many other international companies, don't want to pay any tax here. What we are saying is that if you want to do business in the UK market you damn well pay our taxes and stop trying to subvert the spirit of the law.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
Hey, at least Vinny is a true patriot.
Let's be honest, the majority of Republican voters cheer for billionaires who skip taxes, from their trailers, in red states that accept money from blue states.
You have to love the success story of a party that convinces people to fight for the right to push their own families to the back of the bus in order to patriotically benefit the rich.
It's amazing how the Fark Independents come out and discuss a minor point largely irrelevant to the point at hand.
And by the way, I like to shoot, but I take offense at your name. Obviously not one of us who take shooting seriously, and you wear it on your sleeve as an "Internet Tough Guy."
At the range, I'd be the guy taking the booth on the opposite end from you as I'd be afraid you might not handle your weapon correctly.
In the future, if you don't want to be taken as a complete idiot, you might want to use a different name.
Bye.
--
BMO
You know the easiest way to reduce corporate ownership complexity is to reduce tax law complexity. Forget everything else. Make tax law simple and straightforward and lots of problems go away. Once you have done that, you can look at the remaining problems and start to come up with solutions. However, the problem with both offshoring profits and complex corporate ownership can for the most part be solved by simplifying the tax code.
The truth is that all men having power ought to be mistrusted. James Madison
I believe I just said that.
However, even if you simplify tax laws as much as possible, it'll still be possible to offshore profits by buying expensive nothing from shell companies incorporated in tax havens. This trivial accounting trick will bring your taxable profits close to zero. Apart from simplifying tax laws, you also need to make an official list of tax havens and make a new law which states that money paid to companies incorporated in those tax havens is never recognized as tax-deductible expenses.
You are not a legal entity in Ireland. You are not a legal entity in the Cayman Islands. You, in fact, are probably not allowed to be a legal entity in both of those plus the United States. (If you started out as a legal entity in the Cayman Islands, you sure as hell aren't going to be one in the US in less than a decade of effort.) Therefore this trick of simply moving money across jurisdictions isn't available to you. And that, in a nutshell, is why the trick of moving money across jurisdictions is a cheat. Because you and I can't do it. Not can't because we can't pay the fees (though that's true too). Can't because it's literally not legal. Corporations are NOT people. Corporations can pay a $50 fee and exist as a legal entity anywhere in the world, and multiply their existences into multiple countries for that same trivial fee. If you tried to do that, you'd end up on a Homeland Security watchlist.
Double taxation it may be, but you have the solution precisely backwards. It's the moving money around that is the source of these tax loopholes in the first place. Money is moved from the United States to Ireland and from Ireland to the Cayman Islands, while doing no work whatsoever along the way, and suddenly it is magically no longer taxable at any of those stops along the way? Bullshit. Tax each and every transfer like that, and watch all these tricks go away.
Meanwhile, eliminate taxes on individuals.
We're at a severe disadvantage as natural persons. We're either not allowed to hold multiple citizenships, or acquiring them is extremely expensive (relatively speaking) and extremely time-consuming (absolutely speaking). We're mortal. Corporations are not. We only have one income. Corporations have hundreds of millions. We only have one brain. Corporations have tens of thousands. The asymmetry is monstrous, unfair, and insurmountable. I would argue to abolish the legal concept completely, except that we humans seem unable to effectively organize collectively any other way. Certainly our attempts to collectively organize governments are universally pathetic. So we're stuck with the legal creature, at least for now. But stop pretending they're individual people, and stop pretending that we owe them ANYTHING. It's the other way around. They owe us EVERYTHING, and not just salaries.
Taxes are a necessary evil as long as a military is a necessary evil, and as long as we have the idea that we need to pay for necessary evils. So let's tax the legal entity that feels it the least, and leave the rest of us alone.
Why do you think the rich stepped up during the great depression? Why did the rockafellers and Getty's donate tons of money to the poor, and help out?
Because it was in their self interest to do so. Helping the poor meant improving a society that had all but collapsed. You can't make more money if nobody has any to give you.
If you need web hosting, you could do worse than here
Wow, let me guess: you have got to be Greek!
This guide is definitive. Reality is frequently inacurate. (from THHGTTG)
Worse are the corrupt politician who allow it to happen for a kick back of cents, not to the dollar but cents to the thousands of dollars and microscopic percentage which those corrupt cheats take to allow the richest to pay a negligible percentage versus the average wage earner. Now add to this the bullshit were those same lying cheating and stealing arseholes cheat of federal taxes also cheat on state taxes. Time to bust them up and lock them up, the corrupt politicians and those that pay them off.
Chaos - everything, everywhere, everywhen
We can see if there is any reason to do that after we simplify the tax code. Just because something is possible does not mean that it will be worth actually doing it. You talk about simplifying the tax code, but want to put a complication in there right off the bat. That is why it never gets simplified, everyone has one or two complications they want to add. Simplify the tax code, if, once that has been done, there is still a problem with companies offshoring profits (not just that some companies are doing it, but that enough are doing it that it creates a problem) then is the time to introduce your suggested solution. I suspect that if the tax code was simplified very few companies would find the overhead of offshoring profits worth it.
The truth is that all men having power ought to be mistrusted. James Madison
Simplify the tax code, if, once that has been done, there is still a problem with companies offshoring profits (not just that some companies are doing it, but that enough are doing it that it creates a problem) then is the time to introduce your suggested solution.
We're talking under an article that gives you all the proof you need that the additional solution is necessary:
The Caymans-operated subsidiary owns the rights to use Facebook's intellectual property outside the U.S., for which Facebook Ireland pays hefty royalties to use. This lets Facebook Ireland transfer the profits from low-tax Ireland to no-tax Cayman Islands.
Really, what part of the article tells us what they would do under a simplified tax code? The article tells us what they do under current tax law. It does not tell us what they would do under a changed tax law.
The truth is that all men having power ought to be mistrusted. James Madison
That was *exactly* my point.
Oh it's not just you: although, I can agree with some of what holophrastic is imparting, his behavior makes him out to be an incredibly picayune individual.
Corporation also cost society money. SO they shoudl also pay. 20% on the net no deduction except RnD, 30% on any money leaving the US.
1. PEOPLE cost society money(resources). The concept of a corporation also enables more efficient generation of resources. Just like people, some are better at it than others. Just like people, we pass laws and regulations to seek to limit the damage the 'bad eggs' cause.
2. You do realize that 20% of net basically equals a 20% sales tax, right? Though it would end up being a pretty hefty subsidy for sole proprietorships.
3. You specified a deduction for R&D, but not for hiring people, then mentioned 'hire more people' as a tax break, which is it?
4. Not all money moving has value, besides corporations are moving money all the time. Remember, when you own shares of a company, you own a portion of it's assets, not a particular number of dollars. Corps generally try to make the most use out of their assets as they can.
5. How do you define 'money leaving the US'? Is it leaving the USA when a company buys Italian champagne to stock in it's stores? When it imports aluminum bars(production in the USA being practically nil due to low amounts of Bauxite deposits) to fabricate stuff? When a dividend goes to a foreign stock owner?
Most rich/corporations don't actually hoard money. They hoard assets, which they rent out or allow others to use productively in exchange for a portion of the profits. Often expressed as 'interest'.
Sure, I think the idea that a corporation is a person needs to be killed, along with some other adjustments, but the idea of a corporation itself isn't a bad one.
I don't read AC A human right
That's pretty much what the UK has already. A certain amount of your annual income is tax free (about £8000 this year) after which income above that is taxed at 20% up to the next tier, above which income is taxed at 40%.
Capital gains are taxed at 18% or 28% depending on your total income, with the first £10000 in a financial year tax free. Dividend income is taxed at at the income tax rate, with a deduction to account for corporation tax (so you'd only pay income tax on the dividend if you're taxed at 40%). Bank interest is also taxed at your income tax rate (20% automatically witheld, if you're a higher rate taxpayer you declare the remaining tax on your tax return). Stock held within a tax-free account (pension, ISA) attracts no capital gains tax and no additional tax on dividends.
Obviously, if the corporation tax is abolished somebody is going to have to make up that tax revenue, which ends up being the tax-paying citizens, so the tax rate for us is only going to go up. And bear in mind that similarly to large corporations, many high net worth individuals take advantage of loopholes in the tax code to minimize their tax bill. It's not a sense of injustice that makes people go into the 'shady' areas of the law to avoid tax, it's greed.
Here's a question: Why does even the UK still give people making their money via investment preferential treatment over those that 'earn a living'? An extra £2k isn't an insubstantial amount. A top rate of 28% for capital gains is still a heck of a lot lower than 40%. Etc...
Obviously, if the corporation tax is abolished somebody is going to have to make up that tax revenue, which ends up being the tax-paying citizens, so the tax rate for us is only going to go up.
I think the critical difference in thought is that I see it as you're already paying that tax. It's just hidden, out of obvious sight. Like gas taxes - you see the final price on the pump, but in many/most areas over half that price is actually taxes.
And bear in mind that similarly to large corporations, many high net worth individuals take advantage of loopholes in the tax code to minimize their tax bill. It's not a sense of injustice that makes people go into the 'shady' areas of the law to avoid tax, it's greed.
I know that; it's just that the options for high-income individuals to avoid taxes is still more difficult than it is for a huge multinational corporation. I'd try to avoid raising the rate too much.
Most of the actual loopholes Romney exploited have been closed, and closed for a while. The biggest one remaining is our entirely too low capital gains tax rate. I'd argue raising it to the 35% over $400k we currently have for ordinary income, but put some rules in place to allow you to average your capital gains over a number off years, so selling off a property doesn't hit you too hard for a one time affair.
I don't read AC A human right
"Business owners and investors use systems, rather than their time, to generate income." --Robert Kiyosaki
Casteism
Shouldn't tax rates be part of the mix in global cooperation? Those that undermine the rest should be punished by the rest.
"If my taxes jump to 40%, but in exchange health care an all education was free I would be fine with that becasue it has value to myself, and more importantly, society as a whole."
How do you figure such math could possibly work? An extra 20% of your income that you can't spend on your own education/health care, but the government would spend on you *and society as a whole*? How can you come out materially ahead?
If FB doesn't pay taxes, that doesn't mean that the government is getting less money. It means ordinary people are paying more taxes.
How can that be fair ? Everyone in Ireland is giving tax breaks to FB for what, exactly ?
Re: "10s of thousands of projects are done by government entities in the US every year without a problem and using a systematic process which keeps the price low"
ignorant people like you (which there are many in the US) are why the US is so fucked
google peter shieff and ron paul... and educate yourself moron
the US people are dependent on the government and the government is basically the entire economy... which ironically is also the case in China and other socialist countries
"land of the free" is a fucking memory in the US... you can't even fart in the US without being scrutinized by the fucking government, and China has more capitalism (as in a real free market) than the US, where "companies" merely compete for government contracts, grants and payouts
But I also have the thought of 'why bother taxing corporations'? We suck at it, and ultimately companies are owned by individuals, everybody from fat cat industrialists to the retired grandmother who bought $100 of IBM stock 50 years ago.
Well,that is obvious. The corporations will buy huge mansions, expensive luxury cars, etc and the CEO will take home $50k a year... but have the use of all of those nice things like "private" jets and yachts used to transport them to 3 month long conferences on islands of paradise with hundreds of young females attending to their every need. And no tax revenue will be generated.
"Someone needs to talk to the tree of liberty about its ghoulish drinking problem." by ohnocitizen
Setting corporate taxes to zero would drive all of the money that exists towards corporate coffers. Are you sure that is a sane state of affairs?
"Someone needs to talk to the tree of liberty about its ghoulish drinking problem." by ohnocitizen
Under current tax code they can already do that, as the jets, yachts, and such are 'business expenses' and therefore deductible. Though more recent rules require them to account for 'payments in kind', IE if you get a company car for private driving, you have to put in the value of the car* as earned income for the employee.
*At least the portions used for private use. Which includes driving to/from work in most cases. It gets complicated.
I don't read AC A human right
why did obama get into office then? seems like the choir is full of dipshits to me
actually i should qualify that a bit more... obama is just another lying scumbag
ron paul has been consistent in his constitutional policies for 30 years and has served in congress for many of those (so he is definitely "electable" despite what moron journos may suggest), and if he had have won the presidential office he would have been your best hope at disbanding the fed and reigning in government, since he could have vetoed any measure to increase the scope of government
mitt romney is also a dipshit so thanks to the republican primary voters you lost that chance, but i still think voting obama in for a second term won't get you anywhere... it will be business as usual in washington
if you continue to think it's impossible, there's a good bet you'll never get where you want to be (and ironically you thinking you have no power is what you have been brainwashed into thinking)
americans really are a product of their environment, so i don't really blame them for the years of consumption and unscupulous spending, and i feel sorry for the position you find yourselves in now, but as much as the solution seems so hard, consider the result of doing nothing
have you attended any of the rallies or protests?
Re: "It's big money at the helm, not the politicians in office"
no actually its the other way around... you are only looking at the obvious consequence of increased government power. lobbyists get rich because the government has power to sell. if you take the power away from government, there would nothing to bribe the politicians for and the lobbyists would eventually go away
big businesses get rich off the government because of lobbying the government and funding election campaigns, which is essentially corruption... yes it may be hard to imagine that the very government who oppresses other corrupt countries into becoming more "democratic" is actually corrupt itself
the proof is in the pudding... if politicians were'nt benefiting from under the table deals (and over the table deals such as election campaign contributions) there would be no corruption in washington and no bailouts or anything like that. unfortunately politicians are merely human and every human has a price (possibly even ron paul - its just that his price probably far and away exceeds the price of most politicians and is beyond the affordability of even the biggest corporations)
don't be a fool and confuse the issues... it is true that you can't change how corporations operate and that's why you think you have no power, but corporations aren't the bad guy here. they are merely behaving like any pack of dogs (or humans) would in the same situation... if the government throws a bone to a pack of dogs, the biggest dogs are always going to get it... if you think its the dogs fault for taking the bone then you're wrong. the government shouldn't be throwing the bones to the dogs in the first place.
there are 2 solutions: either elect officials that are uncorruptable (good luck with that) or take away bone throwing power from officials, so there is really only one solution, and that's the solution that people like ron paul, peter sheiff, etc have been advocating for years (and being ignored because obviously government doesn't want to give up its power), but the people have some power through who they vote for, and if you vote for people like ron paul (and even though he has now retired you can be sure that there will be more "tea party" reps in future) you can vote in people who may have the balls to start slashing away at the edges of government, reducing department budgets (which will mean less government jobs) etc. yes there will be jobs lost, but the people who lose government jobs will go out and find more productive jobs in companies that actually make useful contributions to the economy
i could go on forever, but if you just type "peter scheiff" in youtube, you will see a man who has his head screwed on right talking to a lot of idiots in media and government who have absolutely no idea how the world works
oops i mean peter schiff (not scheiff) of course... dunno how i got that spelling in my head
i do see it (i've been listening to guys like ron paul and peter schiff... they have consistently been right, and everyone else has been consistently wrong), and you are right in describing signs and consequences of the problem (corporate campaign donations and corrupt politicans), but you are confused about the actual underlying problem itself.
if you keep thinking that the corporate sector is to blame then you will be stuck... the corporate sector isn't to blame
i repeat... capitalism is a good thing if left to work as intended
corporations should be allowed to make a profit, lobbyists should be abllowed to lobby, corrupt businesspeople should be free to run for president... these are all good things that real freedom and protection of liberty gives you... nobody should be able to judge the corruptability of a presidential candidate except voters
government intervention is a bad thing, because government isn't spending money that it has earnt, and it spends it without consideration of risk
corporations spend their money much more wisely because they have to earn it by selling things... EXCEPT when they receive government bailouts, in which case there is no risk and they can go as crazy as the government
it is impossible to stop corrupt businesspeople from running for office... barack obama seemed like a saint when he first ran for office... he said he was going to change everything, but he's not a saint and he's repeating all the same mistakes as bush, except much worse
corporations aren't your enemy.... the government is your enemy... the government is stealing your money, not the corporations
when you hear reports of huge corporate profits, in most cases (where the government isn't involved in bailing them out) it is because the corporations are selling things... look at apple for instance... it is doing well because they are selling a lot of ithings... don't hate them because they are selling stuff
apple's customers aren't forced to buy apple products... they do so by choice
on the other hand, the government is FORCING TAXPAYERS to buy all sorts of shit that they can't afford, and by printing money, the fed is stealing money off you buy devaluing your currency
don't bother looking at the stockmarket or housing prices to see if the economy is doing well... look at how much it costs for a loaf of bread... when was the last time the cost of a loaf of bread went down? your dollar is buying you less with each passing day. if you look at the value of the US dollar against gold (the original base used up to 1971, the value has dropped significantly (the table at http://en.wikipedia.org/wiki/United_States_dollar#Value shows it pretty starkly, and funny enough according to that table the dollar value really started dropping after the introduction of the federal reserve in 1913, but it only started dropping perpetually after 1971)
you are right that there are corrupt politicians... there have always been corrupt politicians though so you aren't making any breakthroughs there. corrupt politicans aren't the problem either. the problem is you have allowed government to become so powerful, that your corrupt politicians have lots of power to sell. take away the power of government, and there is less reason to want to bribe officials regardless of how corrupt they are.
THE SIZE OF YOUR GOVERNMENT IS YOUR PROBLEM
humans will always be human. you can't blame them for that. corporations can be corrupt, but they have always been and they are in Australia too... the difference betwee nthe US and Australia is that in Australia the politicans have less power so sell, so there is less incentives for corporations to bribe. a smaller government is a better government
i may not be living in the US, but that's good in a way because i can see the overall picture with more objectivity and clarity (i'm not affected by the consequence of bad policy as much as you)
don't believe what you see in movies, don't believe what you see on CNBC or Fox News..
i think we are on the same page, though i must admit i haven't figured out who i'm talking to... i don't really take much notice of what i do on slashdot... most of the time i just use it as a platform to rant (gotta love that freedom thing)
"Only way to do it? Get money"
don't bother. it won't be long till your money won't buy anything anyway. many of those rich scumbags you hate will be broke too. only those with real assets (commodities, property, etc) will be "worth" anything
your attitude seems like one of desperation and despair, but there are lots of people who are on their feet trying to make a difference, and when it comes to the crunch they have the best chance of success (obviously doing nothing won't get you anywhere)
there is a really good youtube video of peter schiff talking to protesters at the occupy wall street gathering... they share similar views but many still think the corporations are to blame so their rage is misdirected
who appear to have your head screwed on... to make sure its on tight, i hope you realise that corporations are what made your country great... allowing your government to increase in size and scope will destroy you (and it seems like you do understand)
you probably still have a job so protesting is difficult, but you have access to the internet... you have access to a phone most likely...
spread the word... help your fellow countrymen to wake up and see the writing on the wall... contact your local, state and federal representatives and let them know how you feel
it seems so hopeless but the consequences of doing nothing are so much worse than doing something... anything
even this conversation may help people reading understand, which can only be a good thing
there will likely be a bond market collapse in the near future (google "stockton bankruptsy" for starters), and when the debt ceiling is raised again soon holders of t-bonds will (hopefully) wake up and realise the government is never going to make good on them
the longer your economy prolongs the inevitable, the worse it will be in the end
cheers mate, and good luck in the coming months... you are gunna need it
zero income taxes, 10% goods and services taxes, and 7% interest rate
if you really want to punish the wealthy, punish their spending habits
that way the more you spend the income the government makes, and in a consumption economy like the US, the government is going to make A FUCKLOAD of income from GST alone
...the middle class (who spends less than the rich) starts to save more because they don't pay income tax
oh, and someone needs to "suicide" ben bernanke... check out this youtube clip
http://www.youtube.com/watch?v=LzhrphUG68s
fucking douchebag
well i must admit i'm surprised... apk
re: "not SO bad now, but I expect as you do, especially for us coders with NO UNIONS BACKING US. it will be worse shortly"
i agree that software development will be hard hit. i'm not in America but if Australia hits hard times I'm a bit more fortunate to be a professional engineer with representation by engineers australia (which is probably more of a lobby organisation, but they have a lot of clout having influence over australia standards, worksafe, minimum salaries, and inflence in the legislative process, etc... they really have too much power and are a pain to deal with actually because they are forcing the whole chartered status thing). i do programming in my job (i do get paid for programming), but its mainly development of specialist software (LAMP and some delphi) to support the engineering side of things.
re: "In today's "litigious society"? You NEED "the holy dollar" or you get NO LAW"
definitely true... but in tomorrow's mahem when the dollar collapses, it may well be 'every man for himself' and 'survival of the fittest'. you probably needn't bother with preparations unless you build a fortress, because if you prepare more than the unprepared masses, you will become a target of the unprepared masses. its probably hard to take seriously, but have you seen the "mad max" movies? or the movie "water world"? martial law will of course be declared at some point in the midst of the collapse, but that will only work as long as the government can support the soldiers (paying with commodities or land because dollars will of course be worthless). you'll probably find that little empires start to build, and the US becomes a feudal state. the idiot "new world" secret societies that think they are in control will be as surprised as the politicians at how uncivilized a country of consumers can get when there is no more left to consume. the UN might risk sending in some foreign peacekeeping troops but that won't save you. sorry this is getting really pessimistic, but as an outside observer, this kind of future for america wouldn't surprise me... that is unless obama goes crazy with his nuclear football and triggers world war 3.
re: "paying 3x what you actually have in that asset, imo is STUPID... but, some folks have no other recourse is all"
i'm one of those folks that has no other choice but to mortgage, but fortunately i didn't overextend (my mortgage payments are more than double the minimum, with a redraw facility that i use for some bills)
re: "NO man... GREAT MEN DID... selfless TRUE 'leaders'"
i agree, and there have been great political leaders, but also great corporate leaders that have spurred the US economy... henry ford, steve jobs, etc. government jobs don't build an economy... they simply take money from the taxpayer and spend it (inefficiently)... the government sector is an economic overhead in that they don't produce anything. not to say that government can't have a stake in private companies (as a shareholder)... but if the government has operational control it always fucks things up. government would have difficulty organising a fuck in a brothel. the corporate sector is efficient because it must be or it will die (except of course if tainted by government bailouts). even in the face of increased government regulation and continuous scrutiny and meddling, the corporate sector comes up with ways to stay competitive (by shifting production offshore or by evading tax with offshore shell companies). if the american labour market was as competitive as china's labor market, americans would have jobs. that seems unfair that americans should work for less pay, but your standard of living is based on debt anyway. in a balanced economy your standard of living would be lower anyway, and when the shit hits the fan your standard of living is going to plummet. most employers want to be able to pay decent salaries because people work harder when they are happy (henry ford is an example, along with google more recently).
as an aside i wanted to find out who australia's reserve bank was accountable, since i've been hearing the america's federal reserve is apparently accountable to nobody. from their website, the RBA is bound by the Reserve Bank Act 1959, and while the bank has certain freedoms to direct monitary policy, it must report to the treasurer and in matters of disagreement the governor general intervenes and can force the reserve to implement changes to its policy, so at least the Australian people have a some semblence of control over its currency, and the government would be unpopular to allow the RBA to go on a printing rampage and i think the governor general might be used in that case. given that our governor general is an australian and a woman (i think a little less corruptable than a man, personal opinion only), i think she would do the right thing by the people and force the RBA to pull its head in
http://www.rba.gov.au/about-rba/accountability.html#consultation_with_government
from the fed website i couldn't find much in the way of disagreement resolution between congress and the fed other than reporting, but i did come across this gem in the fed act itself, which may prove useful to congress if push comes to shove
http://www.federalreserve.gov/aboutthefed/section31.htm
The congress can amend the act to restrict the functions of the fed if it chooses to. I don't know why they haven't already... i guess the fed having a printing press makes it easy for them to buy members of congress
yea I was thinking pensions too, but those come out of state tax I believe. My example doesn't matter too much I don't think, there's definitely a bubble in SS regardless of max payouts... and as somebody mentioned Medicare is a part of social security and we're known for our health industry charging massive amounts of money off of medicare.
That's nice, for you. Where I live, taxes buy a whole lot of horrible, uncivilized things.
There's no time like the present. Well, the past used to be.
To which the US should reply, "we are $16 Trillion in debt, we don't have the means, so very, very sorry"
Pain is merely failure leaving the body
That's may or may not be true but what would happen with a "Fair Tax" if it's really such a thing, would be a huge growth in the underground economy.
Pain is merely failure leaving the body