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For Microsoft, $93B Abroad Means Avoiding $30B Tax Hit
walterbyrd (182728) writes "Microsoft Corp. is currently sitting on almost $29.6 billion it would owe in U.S. taxes if it repatriated the $92.9 billion of earnings it is keeping offshore, according to disclosures in the company's most recent annual filings with the Securities and Exchange Commission. The amount of money that Microsoft is keeping offshore represents a significant spike from prior years, and the levies the company would owe amount to almost the entire two-year operating budget of the company's home state of Washington."
Why should they repatriate it? What's wrong with keeping money earned abroad, abroad?
If they want to be multinational, they better be prepared to pay multinational, 'natch.
What is wrong with that?
Bill Gates openly supports creating an income tax in Washington to pay for education.
Separately, doesn't Apple have even more money outside the US?
If business are people, and people pay taxes, businesses should pay taxes.
And what's really wrong with a business owner doing his or her share? Our economy works because we put money into it, and not paying taxes harms the economy.
I know the answer is "greed", of course.
Good for Microsoft! Why should they be paying any more of the money the earned (and not even in the US) to those that decidedly did not earn it than they absolutely have to?
American Third Position
Finally, a real choice!
They should be dissolved. They America and they hate American workers.
To hell with them.
I think this is not avoiding taxes. This is more a proof that governments are asking too much taxes...
That is money Microsoft earned offshore. It's foreign money. If Microsoft moved that money to the US, the money would not be "coming home", become American money again. It never was American money.
Any corporation that does take advantage of tax law loop holes is stupid. Bitching about it here is also stupid. Go ahead and see what happens if you try and change the laws in the US. Nothing, no more income, less jobs, etc. If you want to attract business, make it cheaper here, not in the Ireland, Bermuda, or the Far East.
Yes, we all need to share the love of a company that insists upon importing labor while hording money in off shore accounts. But to really be totally offensive and obnoxious they claim that this is good for America while screwing everyone in sight. Now please remain calm. Please do not get upset or disgruntled and actually do anything to stop this wonderful cluster that is using us without lube.
I'm not a US citizen, nor I live in the US, but AFAIK, US citizens have to keep paying taxes even if they live abroad, until they resign their US citizenship. Why doesn't this apply to US companies? Even worse.. if they are people (or they have the same rights as US people), why can they do this?
So why this assumption that they should be paying tax on this money to the US taxman? ;-)
Presumably it was all earned outside of the US.
As a UK taxpayer, I'd be much happier if they would pay UK tax on it (maybe we should offer them a deal - 1% of something is a better deal than 50% of nothing
And no doubt French, German, Japanese, Australian, etc tax payers would feel the same way.
So what's so special about the Americans?
Just send them the tax bill as if the money had been repatriated.
Even though that $93B is over seas - it is in US Treasury bills holding overseas
Is Adam Opel AG the same company as General Motors? Is General Motors UK Limited the same company as Adam Opel AG? etc.
because fuck 63 billion; I want it all.
all the more reason to end the stupid tax code that we have. I had a theory I put together the other day, im sure im not the first but hear me out
What if we had a 1 penny tax on transactions, any transaction. For example there are 300 million bank transactions in the country a day. thats 30 million in taxes per day, JUST on bank transactions.
add in all the rest, fast food, shopping plazas, and wallstreet with micro/nano transactions
i need to do some more of the math, but if we add up 1 penny to all transactions (regardless of costs/ or items) everyone will be paying their fair share, no more loopholes, and things would be good.
have you seen my sig? there are many others like it but none that are the same
...means $30B less they need to charge consumers. Or $30B more they can spend on their workers. Or $30B more they can provide to their shareholders.
In fact, thinking about it, the only way the government really gets screwed is if they charge consumers less, since that's also less tax revenue - both giving more money to their employees, or their shareholders, will end up triggering more taxes.
Taxes may be necessary, but they should be as minimal as possible.
All corporations operating in the United States of America for profit should be made to pay 10% of their gross income to American public infrastructure annually.
Microsoft is right to hide this money from the united states as it would only be exploded in bombs.
Microsoft are simply copying what Apple does. IBM and others are doing it too.
They're all hoping that they can get the tax law changed so that they can repatriate the profits without paying the current tax rate.
you mean 0% - stop being an idiot socialist
With articles like these, who needs legitimate news?
If it waz me that had money overseas that the Idiots in Ridiculous Suits IRS wanted, id be in jail until they got it. Corporations are people so jail the ceo veeps and board. Theyd pay then. Microsoft has been picking pockets for far too long. Not to mention the frequent "INNOVATION" AKA THEFT of IP from a ywhere they find it.
corp tax rate = 0%
start cutting worthless fed employees - EPA first
Obviously what American people need to do is clone themselves in low tax jurisdictions and have all their earnings paid to their clones. Isn't that effectively what the big corporations do?
Legal tax avoidance:
http://www.investopedia.com/terms/d/double-irish-with-a-dutch-sandwich.asp
The number one priority of corporations is to increase their profit and investor value. Since they have all of the money, they write all of the laws. Complain about it when it is not legal.
I don't think there's any other country in the world that taxes money coming INTO the country from foreign operations.
The US tax code is insane.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
The less you get of it. One of those damn Econ 101 rules.
Wait a minute. Let's follow legal reasoning.
Corporations are people, right? When a person lives and works overseas, even though the money is earned overseas, they're still supposed to file a return and pay taxes on those earnings, right? How can Microsoft claim legal personhood, and then neglect to pay taxes on their offshore earnings?
The Christian Right is Neither (Christian nor right). See: Matthew 23, Matthew 25, Ezekiel 16:48-50
Every one of us do whatever we can to reduce the tax we owe. If they transfer the money to the US they will be paying the taxes, as it is, they are paying another country's taxes. Which is lower where ever it is, since the USA has the highest corporate tax in the world.
This is one reason why raising tax rate dose not result in more tax revenue.
You've invented a regressive tax - great if your goal was to reward the wealthy at the expense of the poor.
Notice the numbers in TFA are following the Nokia and Skype purchases from several years ago. Skype cost Microsoft about 8 or 9 billion. Nokia cost Microsoft about 3 billion dollars (50% less than Ballmer paid for the Los Angeles Clippers basketball team, and using his own money).
In other words, The U.S. based Microsoft Corporation (HQ'd in Reno, NV to avoid paying taxes to Washington State) bought those non-US companies with off-shored income having paid very little tax to anyone, for anything. You and I can't buy companies so easily, but Microsoft can, and did.
Google paid 1.5 billion dollars for prime London real estate to build their office there, with the same type of Non-US, double-Dutch sandwich money. This is the way the game is played. And these large companies seriously lobby the US congress for a special tax repatriation holiday, as a way to negotiate a lower rate, if they are to chose to pay US taxes.
At least when Facebook paid 16 billion dollars for WhatsApp, they didn't use non-taxable offshore money, because they bought a US company.
You can't be ahead of the curve, if you're stuck in a loop.
Bill Gates and Warren Buffet help their liberal politician friends push for more government spending and higher taxes by doing interviews in which they say things like "I'm not taxed enough" and "rich people like me SHOULD be taxed more". They curry favor with the poor (who would otherwise DESPISE them as "robber-barons" and chase them down with buckets of hot tar and feathers) by calling for big increases in social and education spending (as though THEY, the super-rich, would actualy be paying their "fair share" for those things rather than letting the added costs get heaped onto the national debt). But the TRUTH is that the resulting taxes only actually hit the middle- and upper-middle class people and those government programs never actually end poverty or increase highschool graduation rates etc. Gates, Buffet, Soros, and the rest of that toxic crowd of uber-rich left-wingers keep MASSIVE piles of their assets parked in corporations which, in turn, keep the money parked outside the US un- or under-taxed. Middleclass people lack the lawyers and accountants to park their money overseas.
Anybody who earns less than $500K per year who falls for the crap these jerks shovel is a FOOL
Why should they repatriate it? What's wrong with keeping money earned abroad, abroad?
Every (other) post here was written as if it's the 99% pushing for Microsoft to repatriate these profits and that's just not the case.
Wall Street and the 0.1% are the ones pushing so hard for Microsoft and other large companies to repatriate those fat profits so that they can be siphoned off as juicy special dividends to boost the profits of Wall Street banks, hedge funds, etc. That's why every story has a focus on how much of those profits would have to go to Uncle Sam instead of being available for the dividends payment.
We gave these companies a tax holiday once before and practically none of the money they brought back was used for jobs ... it did provide a nice boost to Wall Streeters profits though.
They aren't paying for any protection provided by the US.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
That's almost $30B available for productive investment that will not be poured down the US tax rat hole.
If you want to sell in the United States we get to tax your global profits?"
More like "If you want to operate in the US and want its protection, forget about using jurisdictional shell games"
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
If they're willing to go far enough to pass that law, I wouldn't put it past them to pre-emptively shut down some tax domiciles.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Congratulations, you just proved that it won't fail the test of targeting one party.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Of course they're using tax shelters to avoid paying taxes that they legitimately owe.
And I'm also... not sure if amused is the right word... at the GOP/Libertarians here who think this is just great... and then turn around and yell about the US national debt, and raising *their* income taxes.
mark "there are two kinds of Republicans: millionaires and suckers"
more government spending, he can shove it right up his own exhaust port.
just like Warren Buffet.
all these rich people talking about how "we" gotta pay for other people's health/living expenses or increased cost of energy for "saving the planet" yet they refuse to open their own wallets to do what they want, but expect those of us who cannot expect to own a home ever to do so.
Goes for all you rich folk with two homes and multiple european sedans and big international vacations every year. Yes, you're rich. And if you feel guilty about your place, pay for your own guilt. Don't make the rest of us do so.