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Microsoft Offers Washington a Bargain: More State Taxes, For More Education
reifman writes: The Washington State Legislature and its budget is a complete mess this year but there's been an unusual bright spot which may quiet the protesters Slashdot reported earlier: Microsoft has volunteered for an exclusive $28 million annual tax — as long as the state funds a number of computer science degree programs. Visions of these faded after the 2008 recession when the legislature cut $4 billion from K-12 and higher education spending in part to cover the coming legalization and amnesty for Microsoft's Nevada tax dodge (students' tuitions only increased 58.6 percent.) With Microsoft's voluntary tax, the company will have fully repaid its $8.75 billion tax dodge by 2327, just 312 years from now.
Cisco for a long time inserted itself in schools by providing major discounts. They figured that if you train people to use and love Cisco, they will grow up buying Cisco. It's the common case of buy what you know. I did it, you did it and well all do it again.
Whats with the ironic tone used in this "article"?
Microsoft has cleverly figured out that it can spend $28 million to A) increase competition in the CS grad job market, thus driving down the cost of employees, and B) offload the costs they would incur training hires over to the state. How clever.
Microsoft, the 0.7% solution!
If the personal belief exemption for vaccines is outlawed. Otherwise I will throw a temper tantrum and use the equivalent of the taxes I should owe to hire lawyers to litigate until I turn blue in the face and the state gives up
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
really.
...
So you can save more on salaries later. More OMGZ NO CODERS bs from MS who doesn't want to actually pay their workers well.
How about, I don't know, starting a grassroots campaign? Maybe Microsoft could run its own damn schools if they want these education benefits so badly.
I love it! This is the WAY to do it. If you want more skilled people - with the skills you want - you work with schools to produce the type of people you want. None of this bullshit of "we can't get qualified Americans so we need H1-bs".
Caterpillar did the same when they were having problems getting welders.
The thing I find the most annoying about budgets especially at the local level is that when money gets tight they'll always raise money for "schools" or "police" or something when really the cost over runs are because of something completely different.
And instead of cutting spending where it got out of control... they instead jack up taxes for "the children"... and then divert all that money to some other project.
I've even seen tax bills written such that that was specifically supposed to happen... and they looted the fund anyway in contravention of the law... and who is going to prosecute? Not the AG.
I think we might need a fourth branch of government that does nothing but hold the other three accountable.
Anyone ever read Herbert's the "Whipping Star" or its sequel? It has this concept in it... he called it "the Bureau of Sabotage"... they did nothing but fuck up the other branches so they couldn't pull any tricky slights of hand, fuck over the democratic system, break the law, etc... the bureau slowed the other branches down... so that they couldn't subvert due process.
Something like that at every level might fix a lot of our problems.
People would point out that that would be expensive... I would would ask... more expensive than rampant corruption and subverted law?
I've decided to stop wasting my time responding to AC trolls/sockpuppets... so if you want a response from me... login.
Would Microsoft really leave the state if the legislature decides to end the exemption/whatever that allows such a tax dodge?
As for this "voluntary tax", I sort of want to say, "No, unless it can be spent how the state pleases. Otherwise, donate it directly to the schools in question."
I think we might need a fourth branch of government that does nothing but hold the other three accountable.
We have that - it's called the press. Combined with an informed electorate it's pretty effective in the long run. It's not official in the government but you really don't want it to be. An official branch of government that isn't accountable itself is called a dictatorship. I'm pretty sure you wouldn't like that.
I despise Microsoft as much as anyone. But it's, at best, a strawman (non-)argument to call them a tax dodge or to claim they owe your hypothetical billions. Tax evasion and tax avoidance are two entirely different things. Learn the difference, and maybe you can sit at the adult table.
If you think the tax laws are broken, advocate for whatever changes you think are appropriate. But if you're going to attack someone else for not paying more tax than they are legally obligated to; then put your money where your mouth is, file a new W-4 with an extra $1000/cycle withholding yourself, and don't cash the refund check when it comes to you next year. I'll bet a dollar that says you won't though.
Imagine all the people...
did they save legally through bigcorp tax breaks?
that single people must pay
Look, I love the MS hatewagon but "... the company will have fully repaid its $8.75 billion tax dodge ..."
Did they ACTUALLY BREAK THE LAW?
No?
So then what we're saying is that in a fantastically fucked-up tax code, MS took advantage of the rules-as-written to pay as little as possible, right?
Did you, timothy, cheerfully volunteer to pay more taxes than you had to last year?
How's your little "tax dodge" working out, then?
-Styopa
But it's, at best, a strawman (non-)argument to call them a tax dodge or to claim they owe your hypothetical billions.
If they took extraordinary action to avoid paying taxes while still staying within the letter of the law then they ARE dodging taxes. Any argument otherwise is merely equivocation.
Tax evasion and tax avoidance are two entirely different things.
Just because something is legal doesn't make it right. And I don't buy your argument because it is basically a "might makes right" argument. Just because they have the ability to hire lots of lawyers and accountants to do clever tricks avoiding taxes does not mean it should be acceptable. Finding clever loopholes that force others to make up the slack in civil society is not something to be applauded.
But if you're going to attack someone else for not paying more tax than they are legally obligated to
I'm not. I'm attacking them for paying less than they are ethically obligated to. I don't care for a moment that they aren't technically breaking the law. The fact that the laws were imperfectly written does not excuse their behavior. I assure you that I am paying a FAR larger portion of my income in taxes than Microsoft is AND even if we paid the same percentage Microsoft would feel less financial pain from doing so. So until Microsoft starts paying an amount of tax that hurts them as much as what I pay hurts me your argument is bogus.
Not to downsay that, but the tax rate for tech company stock owners is very very very low here, we don't have a state income tax or a capital gains tax, and they tend to pay 1/3 what most workers pay.
Also, they are rescinding the mandatory K-12 classroom size reduction the voters passed, ignoring it so they can build more roads and tax exempt property access for tech companies.
That said, it's a good move at long last.
Pay attention to what they do, not what they say.
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First, guy like Gates, Buffet, Soros, etc and their businesses hide THEIR money out of state or out of the country
Then they run around calling for higher taxes (which will apply to everybody) to fund all sorts of left wing causes they champion, and saying they would be "happy to pay more" (while already paying a smaller percent of their incomes than many individuals and small businesses). They count on nobody asking why they do not just go ahead and pay more without waiting for a tax increase, given that it's perfectly legal to overpay.
Then, when people realize that they have underpaid their taxes, these clowns offer to "voluntarily" pay (out of the goodness of their hearts, of course) over VERY long periods of time (long enough that the interest on the money they have not paid will generate enough money to pay what they ultimately DO pay) and they insist that the government do specific things to get the money (thereby becoming super-legislators without ever running for office).
The state of Washington should just seize all of Microsoft's assets to recover back taxes and penalties, just as it would to any individual or small business that ran-up such a huge bill via willful tax evasion. Of course, THAT would probably require a state government not politically-aligned with Mr Gates...
Who wants to count the number of wrong assumptions, straw men and red herrings in this summary? Bonus points if you count them in TFA.
Hint: You won't be able to count them on your fingers. There's at least four in the first sentence alone.
You are welcome on my lawn.
I imagine in the olden days you would also have complained when caravans took well-travelled and guarded roads rather than taking the back ways laden with bandits...
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Well, if they can't get the H-1B cap increased, then I guess growing their own talent locally, and flooding the market is the next best thing. The H-1B's would have been the optimum solution as that would have forced wages down more quickly.
Washington still has pretty onerous non-compete laws which Amazon and Microsoft pay their lobbyists to keep in place. Sorta sounds similar to H-1B indentured servitude...
No thanks. I'll stay in California.
Since before the Reagan administration, the shift from corporate tax to individual taxes has taken its toll on everything from streets to schools. Most municipalities have spent million (billions) providing tax-increment financing to outright paying for business (stadiums) with the threat that if we didn't pay for these things the "job creators" would leave. Now after Microsoft has establish its wealth, they're willing to pay taxes. They probably should have been paying this all along.
Secondly, while it's wonderful that Washington State has Microsoft to pay these taxes, Microsoft has made money from other states and countries that will not benefit from this. Washington probably provided funding of some kind to Microsoft that kept them in Washington which only perpetuates that view that we need to spend money retaining these companies otherwise they leave.
If companies like Microsoft want to show their dedication to a location, they can start by doing something like this without expecting RIO.
It's an awful nice economy you have there, it would be a shame if all these taxes made us layoff or move out of your state...
Little guys have no such clout, while the Intel's, Nike's, and Microsoft's can swing their weight around pretty readily. the result is that companies over a certain size effectively are able to become tax exempt for state and local purposes.
The argument is always that they employ enough people at high wages who pay plenty, which is a real cop out. Somehow I can't reconcile the behavior with the equal protection clause. Taxes need to be levied evenly and fairly, and letting important people and rich companies dodge these is really corrosive to society.
Could you put a little more socialist bias in your description of the events?
Why no complaints about the 50,000+ six-figure jobs Microsoft created in King County? Or about how Seattle and the Eastside have some of the best public schools on the planet, funded by property taxes, paid by homeowners who work for MS, Amazon, and Google among others? Or about how the technological innovation these companies, and others, provide, funded by the money they don't have to pay as taxes, has improved the abilities of humans around the world to access information and training?
I'm guessing that as a typical socialist, you're unable to understand the concept of opportunity cost (i.e. when taxes remove money from the private sector, the private sector has to cut R&D, expansion, or other expenditures). You probably think that a broken window is good for the economy, despite what Bastiat proved.
So Microsoft is 100% responsible for legislation that benefited numerous other companies, not just Microsoft?
And that $4BN in education cuts, how many years did those cuts accumulate (10?) to reach $4BN, or was it $4BN/year?
Ken
Microsoft has been dodging WA State taxes at least since 1997 by redirecting ALL of its profits to a shell company in Nevada.
This petition here has a good analysis here showing running totals between $2.1 BILLION to $8.4 BILLION in dodged taxes.
Microsoft has effectively corrupted and captured the WA State's government, which routinely passes legislation to forgive Microsoft's back taxes, some as large as $100M a year, at times where the state is running deep into deficits.
Offering to "voluntarily" "contribute" 28M annually is like robbing a bank and then "offering" to return a few cents on the dollar.
"Mr Escobar has offered $100 meellion, if the State of Washington commits to no longer search lockers"
Is it Microsoft's fault that the US tax system is so fucking broken? No, it's not. Microsoft isn't obligated to "repay" its tax savings. You're a shitty editor and you should feel shitty.
So they don't have lobbyists? ...
Are you sure?
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This is a 'donation', not a tax. If it were a real tax, it would be written into law and/or tax code, and wouldn't be a one-time thing. The taxpayer does not get to decide how the specific taxes they pay are spent, and certainly a corporation doesn't.
They should have just donated the remains of Nokia to its employees.
John Chambers, unabashedly stated the strategy at the 2000 Networkers conference in Vegas in front of 12,000 people. Only, Cisco went way further than Microsoft (or Apple) ever did. They created a win-win-win.
Cisco created high quality curriculum (version 5 at the moment) for schools to use. They created a simulator (Packet Tracer) which gets better every day. They supported non-Cisco, "sponsored" curriculum, such as Linux Essentials (NDG), IT Essentials (HP), Cabling (Panduit), etc. Now they are rolling out classes that can be used in middle school, such as Entrepreneurship and Internet of Everything.
The cost that the Cisco Networking Academy (a not-for-profit) has passed on to schools for the curriculum $0. Support Academies are supported by fees, but nobody pays Cisco for the curriculum.
This is a win for schools starved for high quality curriculum, a win for students to get a head start in various technical fields, and a win for Cisco. There are students creating and maintaining every aspect of technology who got their start through Cisco.
How about just paying the taxes you're ostensibly ALREADY SUPPOSED TO BE PAYING!?
It's like they're a mafia don who owns the police department, saying "OH, I might pay those traffic tickets... for a few favours..."
What arrogance.
MS is laying people off left and right. What do they need more CS grads for?
What does that have to do with law makers making shitty laws? Fix the system if you want to fix the system.
I see you're new here. Unlike you, I've managed to get many of my ideas put into practice in this state, when others said it couldn't be done. I've also managed to see that something was not going to happen and predict that with a high level of certainty, due to the nature of this state, on a regular basis.
You can waste your time. I'm not going to.
Rail against the dying of the light if you wish, and battle with the tides. I'll be collecting clams on the beach and having a clam bake instead.
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