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Protesters Blockade Microsoft's Seattle Headquarters Over Tax Breaks
reifman (786887) writes "A thousand unionized healthcare workers protested outside Microsoft's Seattle offices over its Nevada tax dodge on Friday. Microsoft shareholders have pocketed more than $5.34 billion in tax savings as Washington State social services and schools have taken huge cuts. In a hearing Wednesday, the Supreme Court suggested it may hold the Legislature in contempt and order it to repeal all tax breaks to restore proper funding to K-12 schools and universities." I suspect Microsoft's lawyers are careful to engage in legal tax avoidance rather than illegal tax evasion. Geekwire notes "The South Lake Union satellite facility is not a major office for Microsoft, compared to its presence in Redmond. It’s not clear why the workers didn’t protest at Microsoft headquarters."
I suspect they protested at S. Lake Union because that is very close to downtown Seattle and an extremely visible location. Microsoft Campus in Redmond is in the in a much more suburban atmosphere, it would be much less of a visible protest there.
The difference between Microsoft-style tax avoidance and tax evasion is that MS just donate to politicians to reduce the amount of taxes they pay in the former while you don't pay politicians in the latter
The state chose not to pursue over a billion in unpaid taxes. That would put a nice dent in the amount the State owes to schools. The state just gave Boeing NINE BILLION in tax giveaways. It's disgusting. These corporations should pay their taxes.
Itâ(TM)s not clear why the workers didnâ(TM)t protest at Microsoft headquarters."
- this is not the question, and really, the answer is in TFA:
But Jeff Reifman, a technology consultant and writer who used to work for Microsoft, is pointing the finger at his former employer, saying that Microsoft has used a subsidiary in Nevada to avoid paying Washington taxes. Heâ(TM)s written numerous articles about this over the years, and now published a recent commentary on Crosscut.com linking Microsoftâ(TM)s tax policy with the stateâ(TM)s school funding shortfall
There you go, that's why they are in Nevada.
By the way, this is again compared to Burger King for all the wrong reasons:
In response, Hunter said that he and many other legislators tried for years to figure out whether they could tax the money Microsoft sends to Nevada. He said the answer from the stateâ(TM)s lawyers was always, âoeNo.â And he said itâ(TM)s similar to the recent move by Burger King to buy a Canadian company as a way to lower its U.S. tax bill.
âoeTo move that big chunk of revenue to Nevada â" itâ(TM)s legal,â Hunter said. âoeSo this is just like the Burger King thing. Itâ(TM)s frustrating, and youâ(TM)ve got lots of people in Congress who are frustrated about it, but itâ(TM)s legal.â
Burger King is a BRAZILIAN COMPANY, not American. Hasn't been American since about 1989. 70% of its stock is held by a Brazilian conglomerate. Fucking Americans are idiots, crying about a Brazilian company merging with a Canadian one, but what else is new?
However the point is that Microsoft is a victim of unconstitutional, illegal government system that usurped power and is stealing people's money. Income taxes are illegal and are collected illegally for a wide range of reasons.
Of-course the reality is that so are these government monopolies on education and health insurance and care. There should be no government at all in any of it, education and health insurance and care are just as much subject to free market rules as any other products, including food and shelter and clothing and energy and none of is any of government's business and the fact that government is in all of these things is the reason that these socialist / fascist economies are dying and good, the sooner the better. The sooner these socialist/fascist states disappear the sooner people can rebuild their individual freedoms and real economies.
MY OTHER COMMENTS
I don't get this at all?
If a business has avoided paying some taxes *legally* and citizens are angry about it? The proper channel to go through is protesting the government that allowed it.
Any "for profit" business has the responsibility to maximize profits for the sake of its continued existence and growth, and as a duty to its stockholders if it was publicly held. Therefore, it would be irresponsible of it NOT to take advantage of legal tax loopholes or tactics to minimize costs.
It sounds like some people have the idea that they can "shame" businesses into volunteering to pay more tax than they're legally required to pay. I'm not saying that might not have a small measure of success in some situations -- but you'd probably achieve similar results by just randomly picketing ANY profitable business and demanding they give more to charity, or pay more of their profits to improve the local area, or ??
The crux of the problem here is the way the laws are written, so only your legislators can correct it.
People don't bootstrap their earning potential or marketable skills from nothing, nor could they continue to prosper without social cooperation made possible by tax-supported infrastructure and institutions. If you want to be a completely unencumbered individual, find a deserted island.
No, they are saying that the more you earn in this country, the more you have benefited from all of the things the taxes pay for: military, infrastructure, education, etc.
It is a flawed system, and there are better ones (I prefer everyone paying a flat income tax with no dedications), but saying that there should be only sales or use-based taxes is wrong.
Grammer Nazis - I mod you "troll" unless you actually add something on-topic. Yes, I know I have mispellings in my sig.
Corporations are legally separate entities. They are to pay taxes. Then when they dividend their earnings, the shareholders pay taxes. Yes, the government may incentivize corporations to do all manner of social good through tax breaks but it has gone too far.
They produced the software in Washington, that's where they're supposed to pay taxes on it. This is settled case law. It's just that the state chose not to enforce the law and throw executives in prison for tax evasion. Which IMHO sets a bad precedent that you can just not pay your tax bill if you're rich enough.
They claim to sell the software from theri branch in Nevada. But, since the items were produced in WA, they're liable for tax there as well.
I suspect they protested at S. Lake Union because that is very close to downtown Seattle and an extremely visible location.
You have that right on the money.
This year at WWDC there were Apple tax protestors out front before the keynote with the classic protestor drum circle and some kind of chant.
Well the moment the cameras outside are gone? So are they. I had some respect for them before that for at least making a stand, even if I disagree with the position. But they weren't making a stand - they were making a TV show.
Given the behavior it's hard to believe they were not all actors of one form or another. It certainly didn't seem like anyone had the kind of protesting spirit that really meant anything when they couldn't be arsed to protest longer than a few hours. I have to wonder if the Microsoft protest is of the same spiritless form.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Sigh.. It is only made possible by tax-supported infrastructure and institutions because the government injected itself. Before the governments injected themselves, it was sustained by private industry or the people themselves. Those costs were either passed on to the consumers of simple born by the people involved.
You act as if no one could ever function without the government hand holding people through life. Some of the more prosperous years in our history were when the government was not in schools, limited themselves on the roads, did not deliver water and so on. And even to the schools issues, the feds were hands off it when we put man on the moon. It wasn't until years later that feds got involved and now not only do we have a department of education that cannot even do the math to account for their budget at times but we lack sufficient knowledge and resources to put a man on the moon again.
Now what would happen if nobody could hide economic development decisions, such as the relocation of companies between states? That is, that any decision to move, no matter how small or early, had to be publicly disclosed - and that all existing records had to be made public? That would anger thieving states like Georgia, who have no qualms about removing history from Northern states, while providing a chance for states to make an agreement.
Or, you can have the status quo, which encourages blood-feud between states.
On some level this sounds like playing dirty pool but it's really not... it's the exact same thing you would do if you had your employer behind the eight ball in salary negotiations: "Other companies are willing to pay me X for my skills, so why don't you match it or I will leave?"
Statistically speaking, that's a rare enough position that it is an exception. Besides, employers can do more damage with the same position over multiple people and jurisdictions - as they are favored by government over workers.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
I happily invite you to go back to the living standards of the time where the government was not in schools, limited themselves on the roads, did not deliver water and so on. I think you'll find that economic prosperity does not necessarily mean they were living the good life. I sure as hell would never trust a private corporation with my water supply or education, there are way too many juicy corners to cut.
A flat income tax with no deductions? Seriously? You know that'd benefit the rich. Right now, a lot of poor people pay no income tax. I pay no income tax. I just have to worry about self-employment tax (equivalent to FICA taxes for employed persons) and that's it. I don't earn enough to pay income tax, and I don't think I ever have. Came close while in college given my grants.
A flat tax that somehow benefits the rich? Wow, how did you arrive at that?
Let me see here. Under a flat tax I make X dollars and pay Y tax on them where Y = some% of X.
Another person makes 2X dollars and pays 2Y in taxes.
Uncle Money Bags makes 100X dollars (I hope I'm in his will) and pays 100Y in taxes.
You know, that really sounds very fair to me -- although truly fair would be that everybody pays the same amount of tax each year because everybody benefits the same from roads, schools and other provided services.
Anything else is punitive from envious people who hate that someone else had more than they do.
People are weird that way. Take the social experiment where the researcher offers you $50, which you can take or refuse. But there's a condition: If you take the $50 then I get $100. But if you take nothing then I get nothing either. While you'd think that it's a no-brainer that you now have $50 that you didn't have before, you'd be amazed how many people will refuse to take their money because someone else "unfairly" is getting more in the process. And that attitude carries over into other areas.
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Because 10% is very different for someone who makes minimum wage than it is for someone who makes millions. We may use the same roads, but we don't use them at the same level. Someone in a city who can't afford a car will be riding a bus with others, which will result in one less vehicle on the road. Flat tax only works in a case where everyone is on an equal starting point.
So? Apple developers don't care, customers may care. Protesting is about two things, PR and disruption.
Lots of disruption cases are illegal especially in a public setting so disruption is typically reserved for private cases but then how can you be disruptive if you don't have access to the private premises? Disruptive protests are normally done by employees internally but they aren't going to complain about the tax breaks their employer received.
In cases like this the protest is exclusively a PR campaign to raise awareness. Disruption will likely end them in jail, fined, or worse still as in the cases of the Google Buses people may not sympathise due to a misdirected attack.
What they did here was get their face on TV. It's about the best form of public protest you can have. Who cares about a few thousand developers when you have the evening news and media sites picking up the story? In some cases getting your face on TV is the end game and there really is no point it wasting your time beyond that.
And even to the schools issues, the feds were hands off it when we put man on the moon.
Oh deary me! Let's not even consider that Eisenhower sent the Army into Little Rock before Sputnik went up.
“He’s not deformed, he’s just drunk!”
And the parent says "fair" as though there's only one way to evaluate that declaration. As with most things it's a more subtle question than simply declaring that some other position is morally wrong and therefore your position must by default be the only acceptable option. If you want to support a regressive tax feel free, but simply declaring that a progressive tax isn't clearly morally superior is not the same as providing rational in support of a regressive tax.
Moreover anyone who excludes payroll taxes from their definition of "income tax" is stretching credulity. Payroll taxes are paid by even the very poorest earners, are proportional to income, and are deducted from paychecks. The only people who avoid them are the very rich who either hit the upper limit -- though it's unclear why such a limit even exists -- or those who don't have earned income in the first place, like those living on investment income.
And of course most poor people pay both payroll taxes and sales taxes, even if they "pay no income taxes at all". Which is why taxation needs to be considered as a system and not as a series of independent pieces -- only they very rich have the freedom to choose which taxes apply to them.
I would like to point out to you that during those wonderful years without government intrusion, that the economy suffered regular cyclical booms and busts that devastated lives.
You could say that it was the effects of one of the greatest busts in history, the Great Depression, that kickstarted the government into creating the PWA, an organization that has done more public good than any Wal-Mart or Microsoft. Hoover Dam, Grand Coulee Dam, the Lincoln Tunnel, the Triborough Bridge, Fort Peck Dam, LaGuardia Airport.. just a few of the things that we depend on still, public projects that spurred further private growth at a time when private industry was deadlocked.
Microsoft would never have built a Hoover Dam, why would they? Where would the profit be for them? And that is the problem when you get to this Libertarian "The market will provide" nonsense. The market will not provide, and it will not provide for everyone, just the people who can pay for it.
Also, your sending men to the moon example? Back then businesses were paying about 40% in taxes and typical returns on investments were expected to be in the 5% range over a decade, not todays 30% returns every quarter and zero taxes nonsense. Because our grandparents and great grandparents respected the role of government in improving the lives of the citizens, and they had learned hard lessons from the Great Depression about relying too much on corporations. Lessons that we are throwing out as we sink further and further into corporate oligarchy.
Some of the more prosperous years in our history were when the government was not in schools, limited themselves on the roads, did not deliver water and so on.
You conveniently ignore the fact that in those years, that infrastructure was owned and/or maintained by communities, not by multinational corporations with a fanatical profit-maximizing agenda.
Assorted stuff I do sometimes: Lemuria.org
Technology would NOT have happened anyways. In 1934 an engineer at Bell Labs named Clarence Hickman created a machine that would answer phone calls and record a message on a magnetic tape. The first answering machine! It was large and clunky, but of course AT&T immediately saw the value of this device and started to work to put this highly profitable device in everyone's homes! Err... not. AT&T killed it because they saw no profit in the device. Worst of all perhaps, was the their suppression of the magnetic tape as a storage medium, which they perceived as directly in competition with their phone business. Why would people make calls, they thought, if they could record their voices and mail the tapes to each other. Magnetic tape recording wouldn't return to America until WWII, with German equipment.
That wasn't the only technology AT&T suppressed that could have changed our world, simply because the managers involved either couldn't see a profit in it, or felt it was directly competing with their own telephone service. Since AT&T had a monopoly on phone service, they kept anyone else from utilizing these inventions as well. Fiber optics, mobile telephones, digital subscriber lines (DSL), fax machines, speakerphones.. all developed or envisioned much earlier than you assume, and all suppressed as being dangers to AT&T's business model.
Those old modems where you put your phone set in acoustic cups? That was because AT&T owned your phone and would rip you apart in court for modifying or replacing their equipment. Even today they still drag their feet over letting equipment onto their networks, not because the hardware is risky (there are like 2 cellular radio chips, and every cell phone uses one of them but no you can't add an 'uncertified' phone to their network!) but because they are deathly afraid of disruption of their profits.
For every innovation that does break through, more are lost through endless litigation, buyouts and suppression. Businesses do not want to innovate, they don't want to create and R&D budgets have been steadily dropping. Businesses want to find a widget or an app that is indispensable, create a market around that with no exits or competition and then ride the profits for as long as possible.
You can rationalize it all you want, but tax "avoidance" really is the same concept as tax evasion.
One is illegal, one is not.
If you think there is some sort of moral obligation to give the government your money, then you're the one with the strange point of view, not Microsoft.
Magnetic tape recording wouldn't return to America until WWII, with German equipment.
That wasn't the only technology AT&T suppressed that could have changed our world, simply because the managers involved either couldn't see a profit in it, or felt it was directly competing with their own telephone service. Since AT&T had a monopoly on phone service, they kept anyone else from utilizing these inventions as well. Fiber optics, mobile telephones, digital subscriber lines (DSL), fax machines, speakerphones.. all developed or envisioned much earlier than you assume, and all suppressed as being dangers to AT&T's business model.
AT&T's monopoly was imposed by the federal government. Government using a lighter touch in telecom regulation in the 1930s would have allowed all those products to market under somebody else's banner. AT&T being an abusive monopoly until they were broken up in the '80s is NOT an example of "We need government because the free market is horrible."
How much would the state collect if they eliminated the income tax deduction for union dues? Seems fair that it goes both ways.