'Making Amazon Look Bad': Microsoft Is Backing a Major Tax On Itself and Amazon (geekwire.com)

Microsoft is urging lawmakers in Washington to increase the tax burden on itself and Amazon (Warning: source may be paywalled; alternative source) to help pay for a new higher education fund. "The bill, which was introduced Monday by Rep. Drew Hansen and Rep. Gerry Pollet among others, "would pour about a billion dollars over the next four years into a 'workforce education account,' to be spent on more financial aid as well as more degree slots in high-demand subjects such as computer science, engineering and nursing," The Seattle Times reports. Microsoft and Amazon would be the only two companies included in the highest tax bracket. From the report: The premise now is to put a surcharge on businesses that benefit the most from a highly skilled workforce. That means high-tech of course, as well as professional services firms. The bill proposes increasing the state business and occupation tax by 20 percent on about 40 categories of technical services, such as telecom, engineering, medical and finance. And by 33 percent on tech firms with more than $25 billion in annual revenue. But here's where this goes off the charts, into politically unheard-of territory. It mandates a top rate, a whopping 67 percent business tax increase, for those "advanced computing businesses" with "worldwide gross revenue of more than one hundred billion dollars" per year. There are only two businesses headquartered here that fit that rarefied description. And one of them, Microsoft, is the tax's biggest booster.

But that other company that would also be most on the hook? Apparently it isn't so thrilled to have been volunteered for civic duty by one of its chief rivals. "Amazon was surprised to be included in such a public 'hey, let's do this' by Microsoft," said Rep. Gael Tarleton, D-Seattle, who said she heard that lament directly from an Amazon lobbyist. Added Pollet: "Amazon has groused in meetings down here that Microsoft is doing this mostly as a way of making Amazon look bad."

Comments

Yep. There's a West Coast "Solution"

[Anonymous Coward]

More taxes will fix everything.

Re: Yep. There's a West Coast "Solution"

[reanjr]

Actually, no, the solution to the actual problems being proposed is more spending. The tax increase is simply an implementation detail.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

How successful is your current system? You are what? 35th in education, 41st in quality of life, 36th on life expectancy. Socialism sucks, but just a little less than capitalism.

Re:Yep. There's a West Coast "Solution"

[AHuxley]

Taking more money from your company so people who can't/won't learn can learn to code.
The only winner is the brand making the GUI software and code ready robot kits to teach random people "code".
Want to learn to code? Pass the test and exams. Get accepted on merit.
All that money flowing from your company to big gov backed learn to code education.
Find a city and state that lets you keep your money.
That support investment.
That welcome private sector jobs.
Great parts of the USA with low crime and clean streets.

Re: Yep. There's a West Coast "Solution"

[ShanghaiBill]

Actually, no, the solution to the actual problems being proposed is more spending.

America spends more per student on education than any other country in the world except Norway. If money was the solution, the problems would have been fixed long ago.

Before anyone claims that is because we spend too much on rich kids while poor kids do without, I will preemptively point out that this is not true. America's school funding is a lot more progressive than many assume.

Re:Yep. There's a West Coast "Solution"

[Xenx]

First, you cannot have 100% failure rate when it still exists. Second, and more important, no system run to the exclusion of all else will succeed indefinitely.

Re:Yep. There's a West Coast "Solution"

[Anonymous Coward]

For years we've talked about the "Microsoft Tax", even though it wasn't an actual tax. Now comes an honest-to-God Microsoft Tax. What makes this one even worse is that people who live at the other end of the country get no benefit from it.

Captcha: travesty

Re: Yep. There's a West Coast "Solution"

[ShanghaiBill]

Socialism sucks, but just a little less than capitalism.

You are likely confusing "Socialism" with "Social Democracy". Although they both contain the root word "social", they are two completely different things. Social democracy is a form of capitalism, not a form of socialism.

Social democracy: Denmark
Socialism: Venezuela

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

How successful is your current system? You are what? 35th in education, 41st in quality of life, 36th on life expectancy. Socialism sucks, but just a little less than capitalism.

Correlation vs Casualty and all that.

The socialism scare in the US is mostly about winning an election. We are in 0 danger of becoming a socialist country, though it is possible government might become more involved in some areas.

Government doing its job is also not the problem. Government doing its job means that it continually looks for ways to improve and do its job more efficiently.

The problem is the country seems to be populated by people that are easy to manipulate, which leads to leaders that use those manipulation tactics, which leads to unethical leaders, failure of government to do a competent job, leaders more interested than power than getting the job done, etc.

Either way its not the isms, since at some point you have to take inputs, operate on them, and produce new settings to optimize the current running state of the country. Sure capitalism tends to self optimise a set of conditions, but the real world contains areas where capitalism doesn't really work, and then your back to government, one way, or another.

With a plan as big as this one, you have to ask what are the second order effects? Is it, for instance, likely that Microsoft and Amazon will just move all their new growth to a new area, and phase out of the expensive area?

Anyone who determines the impact of a proposed law like this without considering that companies have options to address the change you may not like, is a person that should not be trusted with power. That is not to say you avoid doing anything to upset big companies, but that consequences are considered.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

Actually, no, the solution to the actual problems being proposed is more spending. The tax increase is simply an implementation detail.

Where else would they get the money to spend?

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

Economist nice right wing website there

I raise you
https://nces.ed.gov/pubs/web/97916.asp
https://www.usnews.com/news/best-states/articles/2018-02-27/in-most-states-poorest-school-districts-get-less-funding
https://www.nbcnews.com/news/latino/segregation-school-funding-inequalities-still-punishing-black-latino-students-n837186
https://hechingerreport.org/the-gap-between-rich-and-poor-schools-grew-44-percent-over-a-decade/
https://edtrust.org/resource/funding-gaps-2018/
https://www.thenation.com/article/how-unequal-school-funding-punishes-poor-kids/
https://www.globalcitizen.org/en/content/cost-of-education-in-us/
https://www.kpbs.org/news/2011/may/19/schools-rich-neighborhoods-receive-more-tax-dollar/
https://www.theatlantic.com/business/archive/2016/08/property-taxes-and-unequal-schools/497333/
https://www.philly.com/philly/education/pennsylvania-school-funding-lawsuit-rich-poor-districts-20180706.html

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

Your sentence structure.
Reminds me of a haiku.
Outch! its just poor structure.

Re: Yep. There's a West Coast "Solution"

[renegadesx]

When liberal free market democracies are being reduced to eat their pets, give me a call. Name one socialist country doing a better job than us on any of those.
And before you start to say any of the Scandinavian countries, nobody except the American far left even classes them as socialists, they hate the word because they know what the rest of the world knows: Socialism is Venezuela, nor Norway. Social democratic countries are still capitalist with exceptionally low corporate tax rates and high income taxes on the middle class.

Re: Yep. There's a West Coast "Solution"

[war4peace]

America spends more per student on education than any other country in the world except Norway.

There is a difference between "money spent" and "money well spent".

Re: Yep. There's a West Coast "Solution"

[ShanghaiBill]

There is a difference between "money spent" and "money well spent".

That was my point. "More money" isn't the answer, because schools do a poor job with the money they already have.

In the last half century, per student spending has gone up over 300% after adjusting for inflation. The biggest portion of the increased spending went to administrative salaries.

Public schools have one administrator for every two teachers. Private schools and charter schools have one for every five teachers.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

Sorry, Scandinavian socialist governments are still socialist whether you like it or not, uneducated inbred retards. You know nothing about this.

Re: Yep. There's a West Coast "Solution"

[moronoxyd]

As somebody who spent half of his life in a socialist country (East Germany) and now lives in a capitalist country with social democratic leanings I can assure you: You are wrong and GP is right.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

I've moved on from Microsoft. Especially the Microsoft stores. There's always some guy in the doorway to hand you a flier but good luck getting any real assistance. The rest of the clerks are playing video games in the back

Re: Yep. There's a West Coast "Solution"

[mpercy]

They borrow it. Running a deficit where tax revenues don't keep pace with spending is hardly new to governments.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

Those are all Left wing extremist sources, citing false information.

Re: Yep. There's a West Coast "Solution"

[Billly Gates]

Why are Americans so batshit crazy when they hear liberal, socialism, government, or taxes? Is this some sort of cult?

If no government, education, regulations, or taxes were beneficial then why does America rank last of any 1st world country in standards of living, healthcare, shootings, and happiness?

Re: Yep. There's a West Coast "Solution"

[nehumanuscrede]

"Why are Americans so batshit crazy when they hear liberal, socialism, government, or taxes? Is this some sort of cult?

If no government, education, regulations, or taxes were beneficial then why does America rank last of any 1st world country in standards of living, healthcare, shootings, and happiness?"

Oh that's easy.

Because the American Government is horribly corrupt, incompetent and tends to f*ck up just about everything it touches and / or tries to fix.
( See Education, Immigration, Social Security, the Tax Code, Income Inequality, and just about everything that is wrong with America today. )

See we have no filtering in place for those who seek positions of power that will ultimately decide what America is. No test, no qualifications, nothing.

Is how we have folks like Super Socialist AOC who thinks she can fix the world with her delusions of grandeur and extensive political experience.
Is also how we have someone like Trump who has zero qualifications and / or experience in the decisions he has to make on a daily basis.

In other words, we typically have full blown, unqualified idiots running this country who are only looking out for themselves.

Trust me when I say, the less the Government is involved, the better.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

Then half your life is a lie, the other half is uneducated apparently - "Socialism" is defined by economic policies and Scandinavia has them. Sorry bitch. Venezuela is a poor country due to single export mismanagement.

Socialism is all over Europe. You don't have to know anything about it, that's true.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

America spends more per student on education than any other country in the world except Norway.

There is a difference between "money spent" and "money well spent".

A better way to phrase it would be "money wasted". WA state is a pronatalist extremist state. The money would be wasted on worthless, defective humans that are nothing but a drain on the economy, and the environment.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

Prove it or you're a faggot Republican headed for the gallows like Drumpftard. Your claims have zero weight bitch, just like "Shanghai" Bill's. You get caught lying and you never get out.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

The demographics of the USA mean that we have a lot of subhuman monkey people who will spend their whole lives on the the left tail of the Bell Curve. No amount of money or education will change that. It is hard coded into their DNA. If success were proportional to money, all the elite public schools in New York City would be filled with Negroes. But those tech academies are filled with Asians and Whites.

Now consider a race horse. You can pay for the best trainer, and the best veteranary care, and the best equipment, and the best conditioning. But unless that horse has the DNA to be a winner, it will be all for naught. If money equaled success, then every race track would be full of Secretariats instead of nags who finish out of the money.

Re: Yep. There's a West Coast "Solution"

[oh_my_080980980]

Interesting, so then I suppose you support a major military spending cut...

It depends on how the money is spent. So it's overly simplistic to say spending more money didn't not solve problems in education.

Re:Yep. There's a West Coast "Solution"

[oh_my_080980980]

As opposed to corporate welfare...

Re: Yep. There's a West Coast "Solution"

[lgw]

Actually, no, the solution to the actual problems being proposed is more spending. The tax increase is simply an implementation detail.

Problem: medical costs are simply too low, especially for the elderly and disabled.

Solution: lets add more taxes! The tax on medicinal devices worked so well, let's tax anyone who employs nurses. That's will surely keep medical costs rising.

Problem. Solution.

Re: Yep. There's a West Coast "Solution"

[Anonymous Coward]

You are likely to want to suck on deez nuts.

Re: Yep. There's a West Coast "Solution"

[Shotgun]

Yes, and removal of our troops from places like Syria and South Korea.

Re: Yep. There's a West Coast "Solution"

[Shotgun]

Then why are people lining up at our southern border to get in here?

Re: Yep. There's a West Coast "Solution"

[dunkelfalke]

What's your phone number? Because I actually do have a few examples. The socialist dictatorship of Belarus is doing much better than the liberal free market of Ukraine despite roughly comparable starting circumstances (Ukraine actually started on better terms). The socialist dictatorship of Cuba is doing somewhat better thwn the liberal democratic Jamaica.
If you compare economical systems you should do that with similar countries, otherwise it would be a comparison of something else and by that logic an absolutist monarchy with the most part of the economy being family owned would be the most effective way, like in Qatar, Brunei or the UAE.

If anyone makes Amazon look bad, it's AMZN

[reanjr]

Microsoft doesn't decide how Amazon operates. If Amazon looks bad, it's down to Amazon alone.

Re:If anyone makes Amazon look bad, it's AMZN

[cascadingstylesheet]

Microsoft doesn't decide how Amazon operates. If Amazon looks bad, it's down to Amazon alone.

You are being played.

This is common business stuff. Usually it's large businesses getting in bed with government, because they have the heft to comply but small competitors don't.

In this case it's a bit more nuanced, they are leveraging this against a large competitor.

It's hardly virtuous. In fact, pouring money into computer science education is just a ploy to drive down wages of their own employees. It's a twofer.

Re:If anyone makes Amazon look bad, it's AMZN

[omnichad]

It's more than that. They want everyone else to help pay for a higher standard of education in the tech sector. Yet for their relatively small share of the cost, they will reap a larger share of the rewards by recruiting the very best of those. It might drive down wages, but haven't the H1Bs done that even more?

Re:If anyone makes Amazon look bad, it's AMZN

[chispito]

Microsoft doesn't decide how Amazon operates. If Amazon looks bad, it's down to Amazon alone.

You are being played.

This is common business stuff. Usually it's large businesses getting in bed with government, because they have the heft to comply but small competitors don't.

In this case it's a bit more nuanced, they are leveraging this against a large competitor.

It's hardly virtuous. In fact, pouring money into computer science education is just a ploy to drive down wages of their own employees. It's a twofer.

So you're optimistic that the programs will work, but pessimistic as to the motives? I'm rather the opposite: I do not believe pushing people into STEM will result in many more people competing in the field, though I think it's from a misguided effort on the corporations' part to do something about job opportunities for under served groups. I do think in ten years there will be a lot more middle managers who make their careers fiddling around in Python rather than the current crop that have made their careers twiddling around in Excel... but they won't be the ones writing the modules or supporting the databases.

Microsoft thinks they control the legislature

[Anonymous Coward]

And so can tax both Amazon and MS, and divert all the money back to MS. So the moribund MS prospers, Amazon is hurt, MS can virtue signal -- "See, we pay mucho taxes". Win win win.

Re: Microsoft thinks they control the legislature

[Anonymous Coward]

I am speechless

Re: Microsoft thinks they control the legislature

[Anonymous Coward]

y'all forgot about a few places paying the tax

Re: Microsoft thinks they control the legislature

[Anonymous Coward]

*pulls up a chair*

*crunch* *sluuuurp*

This will be good. Go on...

TEXAS

[Anonymous Coward]

Is always open for Business.

Re:TEXAS

[gtall]

and including the that paradigm of capitalism, the patent loving courts in East Texas.

Well played Microsoft

[mykro76]

Who employs more degree-holders in the US?

• Amazon - 600K worldwide, but only about 60K it calls US corporate workers (likely to be degree holders) - the rest are low-wage fulfilment workers. Will pay tax on gross of 230 billion (2018).
• Microsoft - 130K worldwide, with 80K in the US, likely to be virtually all corporate workers. Would pay tax on gross of 110 billion (2018).

So Microsoft is likely to hire more degree holders than Amazon, yet forces Amazon to contribute twice as much to boosting the graduate pool.

Re: Well played Microsoft

[Anonymous Coward]

Are you ready to bunglllllllllllllllllllle!

Re:Well played Microsoft

[Anonymous Coward]

So Microsoft is likely to hire more degree holders than Amazon, yet forces Amazon to contribute twice as much to boosting the graduate pool.

So? People repeatedly defend amazon for not paying taxes by only doing what their legal responsibility is.

Fine. The majority of people see Amazon's responsibility as greater than what they have been doing. Let this democracy's people increase Amazon's legal responsibilities. Bezos and the shareholders can decide to assent to this new responsibility or dissolve. Their choice.

Re:Well played Microsoft

[Anonymous Coward]

What do "this democracy's people" have to do with what legislation is signed into law?

Pretty sure that phrase only refers to corporate people.

Re:Well played Microsoft

[Anonymous Coward]

... likely to hire more degree holders than Amazon ...

Perhaps corporate taxes should include a pro-rata cost for their tertiary-qualified employees. That 'user pays' mechanism can be re-directed to the US polytechnics and state universities.

Re:Well played Microsoft

[Kohath]

If Microsoft wants to pay for education, they don't need a tax. They can just write a check whenever they want.

Just like always, tax supporters — like Microsoft here — only support taxing themselves so they can benefit themselves by spending money other people earned. Every time.

Re:Well played Microsoft

[stealth_finger]

Who employs more degree-holders in the US?

• Amazon - 600K worldwide, but only about 60K it calls US corporate workers (likely to be degree holders) - the rest are low-wage fulfilment workers. Will pay tax on gross of 230 billion (2018).
• Microsoft - 130K worldwide, with 80K in the US, likely to be virtually all corporate workers. Would pay tax on gross of 110 billion (2018).

So Microsoft is likely to hire more degree holders than Amazon, yet forces Amazon to contribute twice as much to boosting the graduate pool.

When amazon is so profitable the owner can have his own fucking space program yeah, maybe they should be paying more tax.

Re: Well played Microsoft

[Anonymous Coward]

Ding!

Something about that atomic clock in the mountain...

Re:Well played Microsoft

[Anonymous Coward]

Stop driving on public roadways. Also, move to a bad school district with no professional fire department so you don't benefit from public goods and the works of others, you hypocrite.

Re:Well played Microsoft

[Anonymous Coward]

Government policy allows the process to scale. One-off volunteering efforts are generally dwarfed by policy.

Invest any state with great care

[AHuxley]

Do your homework before investing in any part of the USA.
The politics, laws, SJW, homeless populations, education levels, power prices, political activism.
Rank each state/city by the tax and costs they create for a larger brand.
Dont allow your band to become a flow fo money for city and state SJW projects and state/city virtue signalling.
Once a city/state wants to extract your profits to fund their political virtue signalling have the ability to move to a really great state.
A state tat welcome investment and that has low crime and less of a homeless problem.
That allows your brand to keep your profits, invest in your brands growth.

Avoid the state/cities that want to extract more of your money for their own side of politics.

Find the states with good housing prices for your workers, good eduction so your workers can work.
Stay away from union and political demands to hire in set parts of a city.
To "create" new jobs for random people after community talks.
Low 24/7 power costs, low tax, less political activism and fast networks.

Re:Invest any state with great care

[Plus1Entropy]

It's amazing how you can type so much and yet say absolutely nothing.

Re:Invest any state with great care

[AHuxley]

How much new tax can only one brand pay before another state looks like a better location to move to?
When is a new "learn to code" tax going to grow to remove all profits?
Why stay in a state who views all productive private sector profits as something to place a new education tax on?
Learn to rank each city and state.
Move to the states that allow growth and who support the private sector.
Why stay and pay ever more virtue signalling taxes? That money thats extracted from the ability to invest and grow a brand.

Re:Invest any state with great care

[stealth_finger]

Do your homework before investing in any part of the USA. The politics, laws, SJW, homeless populations, education levels, power prices, political activism. Rank each state/city by the tax and costs they create for a larger brand. Dont allow your band to become a flow fo money for city and state SJW projects and state/city virtue signalling. Once a city/state wants to extract your profits to fund their political virtue signalling have the ability to move to a really great state. A state tat welcome investment and that has low crime and less of a homeless problem. That allows your brand to keep your profits, invest in your brands growth. Avoid the state/cities that want to extract more of your money for their own side of politics. Find the states with good housing prices for your workers, good eduction so your workers can work. Stay away from union and political demands to hire in set parts of a city. To "create" new jobs for random people after community talks. Low 24/7 power costs, low tax, less political activism and fast networks.

Basically what you're saying is move in, take everything, give nothing, move out.

What is that state is China?

[Anonymous Coward]

Then what do you suggest?

Re:What is that state is China?

[AHuxley]

Find any state/city that actually welcomes new investment and that wants job creation.

Re:What is that state is China?

[Impy the Impiuos Imp]

But paying your fair share* is American!

* Your taxes increased to pay for every last freebie I want to hand out for votes, praise me.

if new_tax cost_to_move then move.

[Anonymous Coward]

if new_tax > cost_to_move then move.

Now tell us what cost_to_move is...

Businesses do not pay tax

[SirAstral]

Notice that line item on your receipts that say "Tax:$$$"... you pay that, not the business... they just collect for uncle sam from you.
Did you also know that businesses calculate the total cost of a product they buy from whole-sellers and vendors, which they paid taxes on, which is a cost they transfer to the consumer that buys the end product?

Did you know that when you cheer on a business paying MORE tax you are actually just cheering on the poor paying more for all of their products? People cheered windfall taxes... prices at the pumps when up... then they cried about it. I was like... huh? you cheered for this you numb-nuts!

The poor tax is real, and it has everything to do with being ignorant about how the economy works. Microsoft is a big company, the money they make filters down to you... the lowly consumer, and NO you do not escape that cost just because you don't use windows. You buy food, your store might use Windows, you pay bills, that company might be using Windows. They all pass down the cost of buying their licenses from Microsoft to you... their customer.

Have you wondered why your dollars do not go as far as they used to? It's not just inflation... inflation is just one component, in fact inflation is more a tax on your savings than anything else.

Let's make this simple.

You own a Burger Joint.
Taxes today for a $5 burger is 10%
Customer pays $5.50 for that burger.
Taxes tomorrow for a $5 burger is 15%
Customer now pays $5.75 for that burger.
Those that cheer for taxes like this, is like the customer cheering that their burger just went up 25 cents. Hurray for you, your senators thank you for your gullibility! They will happily take 20 cents of that 25 and give it to their cronies... D or R it matters not.

It is not a joke when they say that the poor pay for everything and it is not a joke when a reasonable minimum wage is enforced to ensure a minimum viable economy, because if the poor have no money the rich soon lose theirs as well. Look at how many rich folks also suffered in Venezuela when it ran out. Only the super rich are finding ways to survive and that is mostly because they are connected to power, not just because they have $$$.

Couple this with the fact that another poster mentioned that Americans already pay more than enough for education, you might as well call that more than enough evidence that foul play is afoot and you need a sanity check to cheer this on any longer.

And lets not forgot how many businesses that still get out of paying taxes through loophole laws, brought to you by none other that the very elected officials everyone that cheers for this voted in. Do you feel the daggers in your backs yet? No? Okay, that's great... it means they can dig it in further and twist a little more!

Re:Businesses do not pay tax

[Anonymous Coward]

If I own a burger company, and my customers will happily pay $5.75 for a burger, why would I only charge $5?

When you own a business, you price your goods to maximize revenue. You don't need a tax to raise prices.

Given an opportunity to raise prices without alienating customers, the logical thing to do is raise prices. In some philosophies of business, the ethical thing to do is raise prices in that situation.

When you understand that modern business ethics puts maximizing revenue above all other considerations (including profit), then asking for higher taxes makes sense. This allows you an opportunity to increase revenue.

Re:Businesses do not pay tax

[anarcobra]

You are simplifying things in the other direction from GP.
Yes, businesses will raise their price as high as they can, but burger places are competitive, so consumers have the choice of going to a cheaper place. So there will be an equilibrium between maximizing profits and not going to far from the competition. (assuming there is no price fixing)
A tax will affect all the competition as well, so there is a good chance the price of burgers will go up across the board.

Re:Businesses do not pay tax

[Whibla]

Let's make this simple.

You own a Burger Joint.
Taxes today for a $5 burger is 10%
Customer pays $5.50 for that burger.
Taxes tomorrow for a $5 burger is 15%
Customer now pays $5.75 for that burger.
Those that cheer for taxes like this, is like the customer cheering that their burger just went up 25 cents. Hurray for you, your senators thank you for your gullibility! They will happily take 20 cents of that 25 and give it to their cronies... D or R it matters not.

The manufacturing cost of a burger (including fixed costs to simply the point) is $4, and your burger joint sells 1000 burgers per financial year.
Burger sells for $5, excluding sales tax at whatever rate you set it -> profit before (corporation) tax of $1000 dollars.
Corporation tax @ 40% -> net profit of $600, which can be distributed as dividends back to the shareholder. tax of $400 which can be redistributed.
Corporation tax @ 60% -> net profit of $400, which can be distributed as dividends back to the shareholder. tax of $600 which can be redistributed.

Not all taxes are the same, not all taxes 'incentivise' in the same way. Conflating sales tax with corporation tax is woolly thinking of the highest order.

Re:Businesses do not pay tax

[Anonymous Coward]

I agree that sales tax and corporate taxes are incredible different. I don't argue that point at all.

However, you are kind of ignoring the point that the price of the burger will likely go up and not stay the same.

Let's say your burger company has 10 investors, each of whom invested $1000 into your burger company and use the rest of the numbers you provided.
Your investors are used to getting an annual return of $100 each (10% rate of return).
After the 40% tax, your investors are now getting an annual return of $60 each (6% rate of return).
After the 60% tax, your investors are now getting an annual return of $40 each (4% rate of return).

Why would I invest in your company if I thought my rate of return is only going to be 4%?

Now, let's assume that $1000 I invested in your company came from a fund I manage and those funds originally came from grandma and grandpa who were looking for a good investment vehicle to live on in their retirement. Let's say they divide their retirement nest egg of $500,000 among many similar investments. At a:
10% rate of return, their investments are making them $50,000 a year to live on. Not a bad living.
6% rate of return, their investments are making them $30,000 a year to live on. Budget is getting kind of tight.
4% rate of return, their investments are making them $20,000 a year to live on. Where are the cans of dog food?

Now grandma and grandpa are yelling at me, because grandpa has to go back to work in his 70's because your just took away his retirement earnings. So I come screaming to you to raise your rates so grandma and grandpa will get their retirement back on track.

So you raise your prices to $6.50 a burger with same expenses. So now, net profit is $2500
Corporation tax @ 40% -> net profit of $1500, grandma and grandpa are actually doing better than before but their cost of eating out just went out.
Corporation tax @ 60% -> net profit of $1000, grandma and grandpa are doing the same as before, but now paying more to go out to eat.

That is the REALITY of what you are proposing.

So the real question is... Why do you hate old people and want grandpa to go back to work?

Re:Businesses do not pay tax

[AmiMoJo]

You are describing sales tax. Corporation tax is on corporate profits, not on sales.

The obvious flaw in your argument is that you ignore where the $5 price tag for the burger comes from. The company chose $5 based on what the market will pay for its product. If the tax increases the market won't magically be willing to pay more for its product, so price rises may result in losing more from lost sales than the tax increase is worth.

Did Google's prices go up when they were forced to pay the back tax they owned in the EU? Were the EU fines they paid for anti-competitive behaviour passed on directly to their customers? Of course not, the online advertising and cloud computing markets are highly competitive and they are in both for the long term, so they aren't going to jack up costs and damage their competitiveness over a relatively modest tax rate.

Re:Businesses do not pay tax

[drinkypoo]

You own a Burger Joint.
Taxes today for a $5 burger is 10%
Customer pays $5.50 for that burger.
Taxes tomorrow for a $5 burger is 15%
Customer now pays $5.75 for that burger.

Right. The Customer now pays $5.75. The person walking by on the street doesn't pay anything. So it's the people who use the resource who pay the taxes. That's fair, and efficient. Just look at how many people pay required sales taxes if not assessed at purchase time, it's basically nobody. So you tax the business, not the customer, and the customer pays for it — the business makes sure they do, because otherwise they've got a problem.

This is why we need to increase taxes on commercial trucking. Heavy trucks do virtually all the damage to the road surface that's not done by weather itself. Light cars do basically none. RVs do more damage than cars per mile, but they don't move around much, so they don't do much damage overall. Without GPS tracking, the fairest way possible to account for road damage is to charge more fees for commercial trucks, probably those over 26k GVWR (because of the way the current fees are structured, and 26k is a magic number in the eyes of the current law.) The cost of the additional taxes will be rolled into the cost of goods, and then the people who buy those goods will wind up paying them. Those who buy things sourced from shorter distances will wind up paying less of the tax, so that will encourage buying local.

Re:Businesses do not pay tax

[squiggleslash]

That's not what he means. He means that if ACME Burgers Inc has to pay 20% income tax instead of 10% income tax, and makes 5% (25c) profit on a $5 burger, then ACME will have to charge $5.03 for the burger because it'll treat the income tax rise as a rise in costs.

In reality, the situation is more nuanced. An increase in taxes on corporate entities raises the price floor for the products they sell, but there's still an "ideal price" where profit x sales is maximized, and that's usually higher than the price floor.

ACME has to compete with O'Burgers and BurgerEmperor, and that competition will drive down what it can realistically charge for a burger too. But O'Burgers and BurgerEmperor will also see the same rise in "costs", and so there's a limit to how low they'll go.

So in practice, you're unlikely to see any business having to pay more income tax have a noticeable affect on prices. Even if they do pass on the raise, it'd both have to be a huge increase in income tax, AND they'd have to be already making HUGE profits, which they cannot afford to see less of, for the tax to show up as a noticeable increase in prices.

Re:Businesses do not pay tax

[squiggleslash]

You own a Burger Joint.
Taxes today for a $5 burger is 10%
Customer pays $5.50 for that burger.
Taxes tomorrow for a $5 burger is 15%
Customer now pays $5.75 for that burger.

While I agree with the general point, sorta, these numbers are hopelessly wrong as they assume that the burgers are 100% profit and the business has no costs. Taxes on a $5 burger that costs $4.75 to make (assuming 5% profit, which is not unusual in that industry, and includes all amortized costs) would, at 10%, be 2.5c. The increased cost would be less than 2c if taxes went up to 15%.

In all honesty if you doubled corporate income tax tomorrow, between the fact it's a tax on profits and the external pressures keeping costs down, I doubt you'd see a blip of more than a fraction of a point on inflation for the year.

Re:Businesses do not pay tax

[Whibla]

Good points.

But now you're ignoring a couple of other issues: If the price of your burgers jumps 50% will you really still sell the same number of them? If you raise your prices, hence your total sales, will you move up a(nother) tax bracket? If your tax bracket changes what's to stop a smaller company selling burgers at the lower price, undercutting you and taking your customers?

Of course perhaps a more pertinent question might be, why the emotive appeal? Apart from the fact that I'm not responsible for grandpa's investment decisions, and the fact that the targeted tax is intended to strengthen the industries being taxed by providing them with better workers, hence increasing their revenues, profits and dividends, no company should be insulated from the market or the regulatory environment based on who is invested in it.

If you're really worried about Grandma & Grandpa's retirement perhaps some of your tax revenue could go towards providing a national pension scheme ... we could call it Social Security or something...

Re:Businesses do not pay tax

[Anonymous Coward]

That's not what he means.

Then why did he write it like it was? Why was his only example using sales tax if he was actually talking about income tax?

Re:Businesses do not pay tax

[Anonymous Coward]

In Washington State, the Business and Occupation tax (B&O) is not on profits, it is on gross revenue. Even if that sale cost you money, you pay the B&O tax on it. I can't say I'm in favor of this tax increase, since it would affect my profitability as a small business IT Shop.

Re:Businesses do not pay tax

[Anonymous Coward]

Parent poster here.

"A tax will affect all the competition as well, so there is a good chance the price of burgers will go up across the board."

That kind of negates your second statement.

" burger places are competitive, so consumers have the choice of going to a cheaper place"

Yes, supply and demand will always play a role. A vast supply of burger places means more competition so overall lower prices (why you are already only paying $5 for a burger). However, if they all experience a tax hike, like you said, they will all likely raise prices to offset that increase in cost, like you said.

The end result is we pay more for burgers but the investors still receive the same amount of money (which I don't fault them). The poor and the middle class are the most affected (mainly the middle class) because the poor may receive more benefits from the government through their new tax windfall, but the middle class will get nothing except more expensive burgers.

Re:Businesses do not pay tax

[Anonymous Coward]

It was sarcasm and after I posted it, I though I should have labeled it as such. I was just trying to add some humor.

There are a lot of generalities in the scenario. I am assuming the sales volume stays the same and I am assuming that all other burger business are being taxed at the same rate.

My point with Grandma and Grandpa (other than to add a bit of humor) was that there are a lot of people who have invested in companies based on stability in those industries. Implementing a 60% tax rate introduces a lot of potential instability and additional risk thus hurting their investments. And people really do live on their retirement investments. It isn't just wealthy wall street individuals investing in business.

You aren't responsible for grandpa's investment decisions just like I am not responsible for the investment decisions of those whom this tax is supposed to help support. If they choose not to save appropriately for college or to choose a degree path that doesn't have a high employment rate or pay rate, or if they choose an expensive ivy league college over a state or community college, those are all investment choices too. Those investments, just like grandpa's investments come with risk. You have to weigh the risks vs the possible rewards and review your investments and potential investments carefully.

"Shanghai" Bill is a known liar many times over.

[Anonymous Coward]

Bill got caught lying 12-25 times repeatedly stating "Blood plasma is sterile" and then later that "The Chinese Govt does not directly censor Chinese citizens" and other absolute bullshit head-in-ass retard-level lies. You're not trustworthy.

You are not a source of information that anyone should or even could trust, knowing your dishonest history. Sorry. That's what accountability means when you get caught lying repeatedly, over and over, even after directly corrected.

You're a liar, Bill.

Plan: bring Amazon down, then suddenly back out

[Shompol]

This reminds me about that time Microsoft settled with patent trolls with the purpose of scaring Sony into paying. One of the conditions of their settlement was to get money back after Sony pays. They were not ashamed to try and enforce this agreement through court, thus making it public. Microsoft has always been a bunch of narcissistic douche bags, pretending to be a technology company.

Go Microsoft!

[Sivaraj]

I would have never believed I would say this 20 years back. That too on Slashdot. But,

Go Micro$oft!!!

Re:Go Microsoft!

[Anonymous Coward]

This is a tax on 2 businesses, and the money is supposed to go fund higher education. You won't see any benefit from this. Universities are still raising prices thanks to laws that prevent debt discharge on student loans. This money is supposed to go towards additional grants so universities will create additional slots... this is nothing more than putting more bodies into existing classrooms and driving down wages by increasing the available skilled labor pool in 4-6 years.

None of that tax goes to lowering yours. It does not go into K-12 education funding. It does not give you any benefit at all, and arguably does not benefit society either. Its just a PR stunt and won't pass anyways, as its not intended to, its just intended to make Amazon look bad if they fight it.

More evidence of Microsoft circling the drain...

[Anonymous Coward]

As if Windows 10 wasn't enough, now we have Microsoft virtue signaling instead of trying to legitimately compete against the competition in the marketplace.

Fiduciary duties

[Anonymous Coward]

Legally they could not do this unless it was in the shareholders best interest. They've probably maximised their offshoring of profits to the point where is economically viable to support local tax legislation. What do they get out of it? At least some positive media, and at most? Only Microsoft's accountants know.

Re:Fiduciary duties

[Daetrin]

A company can define what's in the best interest of itself, and thus their shareholders, and it does not have to be "maximize profits." Of course many companies decide that maximizing profit is the best path, but the idea that it is a legal requirement is a myth.

Source 1

Source 2

Source 3

Didn't they just ban April Fools jokes?

[Anonymous Coward]

It's a setup!

Why?

[Anonymous Coward]

Leave it to Microsoft to come up with a fucked up solution.

I agree completely

[Anonymous Coward]

If Micro$oft wants to fund STEM education, let them foot the bill.

This amounts to Micro$oft trying to make a competitor pay a tax to harm said competitor.

Always beware when a rich corporation says: "OOO! OOO! Tax me! Tax me!"

Where does Apple fit in to this?

[Anonymous Coward]

Apple makes far more money than M$ and Amazon, last time I checked.

"Shanghai" Bill is a known liar many times over.

[Anonymous Coward]

Bill got caught lying 12-25 times repeatedly stating "Blood plasma is sterile" and then later that "The Chinese Govt does not directly censor Chinese citizens" and other absolute bullshit head-in-ass retard-level lies. You're not trustworthy.

You are not a source of information that anyone should or even could trust, knowing your dishonest history. Sorry. That's what accountability means when you get caught lying repeatedly, over and over, even after directly corrected.

    You're just a liar, Bill.

Finally

[Anonymous Coward]

Now that is a race to the bottom I would be happy to see happening.

Remember the Depression?

[Bruce66423]

OK - you're not old enough
Neither am I!

But that was when a 'liberal market democracy' fell into a deep hole. The hows and whys of how that happened and what got the country out of it are disputed. But it's a reminder that it can happen. And the crash of 2008 wasn't worse than it was because of 'socialist' actions by governments.

If this passes, Amazon new HQ plans to accelerate

[misnohmer]

They already were planning to leave, then decided to just build a second HQ in New York, then decided to just expand everywhere. If this passes, it will give them incentive to setup headquarters elsewhere sooner. Boeing did it, still has factories in Washington, but HQ moved to Chicago in 2001.

Who will get into those programs?

[mark_reh]

They're going to pour money into STEM at colleges? The big companies and filthy rich individuals have been getting tax breaks at the expense of education for so long the public schools can barely teach people to read, forget about STEM. It's been great for the Republicans- unsmart people do what they're told and vote Republican, but they aren't going to do well in STEM programs in colleges.

Maybe we'll have to let immigrants into those STEM programs... Hmmmm.... Maybe we'd better close the borders.

Republicans aren't racist. They don't care what color your skin is (unless you try to marry their daughter). The thing they fear the most is educated people.

Re:Who will get into those programs?

[Anonymous Coward]

You can say the EXACT same thing about Democrats. Both parties don't give a raging rats ass about you or your family! They only care about what's in it for them! How many white democrats do you see with daughters that are married to black or hispanic men? Both parties are out to fuck us all over. As long as they get theirs fuck everyone else! And all the bullshit "think of the children!" - it's more like think of how we can KILL the children, reduce population. OMG climate change! Man is the great evil! Great you want to do something about it - start with all the members of the democrat and republican party stage a mass suicide! Think of how much hot air (carbon dioxide) would be eliminated!

I don't want to pay 67% more for MS products.

[sabbede]

Which is what will happen, as businesses pass costs on to customers.

Re:I don't want to pay 67% more for MS products.

[grumpy-cowboy]

Then don't buy MS products. I don't and I save 100%. ;)

Why Pay Tax?

[Anonymous Coward]

Why can't they just donate the money straight into education? Award bursarys and scholarships as has always been done by benefactors. You know, it is possible to help others without extending the power of the state.

Re:Why Pay Tax?

[temcat]

Because when a large business entity asks to increase taxes "on itself" (mind the weasel words!), in reality it wants that tax to contribute to eliminating smaller competitors for who this tax increase will become a heavier relative burden.

That HQ2 move will come even sooner

[mpercy]

Why stay and get taxed punitively?

Here's a crazy idea

[VeryFluffyBunny]

How about govt. doing its job & making sure everyone pays their fair share of taxes in order to fund the stuff that everyone needs from their govt., e.g. public transportation, education, healthcare, urban planning, law enforcement & judiciary, & public health & safety, you know, all the stuff that improves the standard of living & quality of life for everyone?

That means everyone, including billionaires & corporations, who are currently starving govts. of the funds they need to provide opportunities, safety, health, & security for everyone.

Or you can carry on marching towards poverty & disenfranchisement because the billionaires & corporations fill the power void left by libertarian ideological "small govt." Does that sound democratic & civilised to you?

Re: "Shanghai" Bill is a known liar many times ove

[Anonymous Coward]

Victory at any cost!

Re: Plan: bring Amazon down, then suddenly back ou

[Billly Gates]

Plan in my opinion is to fuck with AWS. If this forces Amazon to move and loose money great. Remember MS desperately wants Azure to succeed to the point of making a MS Linux and MS freebsd distros to attract customers.

MS already has the upper hand with Office365 customers getting Azure already bundled since it runs off that anyway.

Re: If this passes, Amazon new HQ plans to acceler

[Billly Gates]

I think that is their plan. .coms hate it when you have options to jump ship with your trade secrets They don't want the AWS team to gain Azure and Office365 employees.

Moving across the country when you have a mortgage and life makes jumping a lot less attractive

They should take it a step further

[nehumanuscrede]

Impose an even higher tax on all companies who benefit from " highly skilled workers " but prefer to import the cheap versions from places like India vs the local workforce.

That whole H1-B " We can't find any 'skilled' workers locally ( who want to work for minimum wage ) " bullshit to cut costs would come to a screeching halt in a hurry.

Re: More evidence of Microsoft circling the drain.

[Anonymous Coward]

Has MSFT ever legitimately tried to compete based solely on the quality of their products? The real world is dirty, and MSFT knows how the game is played.

It will educate nobody

[scourfish]

It will get squandered, spent poorly, and there will be no accountability when the program goes over budget and the same lawmakers look for more money to squeeze.

Regulatory Capture

[Anonymous Coward]

It's almost like the government allows itself to be the whore that large corporations use to inflict pain on each other when they prove incapable of legitimate competition.

If you don't allow government to have such power, company's won't be able to exploit said power and will be stuck actually competing in the market instead of spending money on politicians.

Re:"Shanghai" Bill is a known liar many times over

[Anonymous Coward]

https://rockland-inc.com/blood/Sterile-Serums-Plasmas.aspx

Ultimately saving them money

[Anonymous Coward]

What they are doing is saving money on competing for high skilled workers by forcing the cost on everyone. Instead of having to pay higher salaries to convince more people to get into tech, they are trying to increase the number of high-tech workers through government subsidy and bring wages down.

Not just trying to make them look bad.

[Anonymous Coward]

Read closely, because WA state has a retarded B&O tax. This means that companies are taxed on revenue instead of profit. This means if you lose money in a given year you are DOUBLE FUCKED in every hole becaus you still have a huge tax bill to pay.

    B&O rates are lower than other taxes precisely because it is based on revenue rather than profit. To ask that these rates be jacked up is utterly dispicable and MS is being a shitstain.