Spanish authorities raid Google offices over tax • Hacker News Board

Re: Spanish authorities raid Google offices over tax

#331

Post by jimmywanger » Fri, Jul 01, 2016, 12:27 AM UTC

conradfr wrote: post #8

I heard someone related to the Paris office raid comment when that happened. She was saying that multinational corporations always say that their organization and tax schemes are legal but that in reality it's so complex and spread in multiple countries that nobody really knows for sure and so it's only legal by default.

Tax laws are NP-complete systems.

Every time you pass a new law you have to think about how it interacts with all other current laws, and how it affects how current laws affect each other.

Passing more laws just inhibits small businesses. As said before, big businesses are able to afford the small army of accountants and lawyers to navigate the lawyers, whereas small businesses just kind of have to take it.

Sort of how the super rich are able to pay a lower tax rate than a solidly middle class family.

Re: Spanish authorities raid Google offices over tax

#332

Post by ACow_Adonis » Fri, Jul 01, 2016, 12:30 AM UTC

hueving wrote: post #238

bobwaycott wrote: post #224

Earlier quoted context omitted.

That you cannot think of such an argument doesn't mean much. That such possible arguments wouldn't obtain "legitimacy" in your mind explains far more about your conception of the role of business in society. There are no optional taxes—any company that actively seeks ways to avoid taxes is not dealing justly or ethically with the society in which it exists. The same goes for citizens. A healthy and just society canno…

You are free to overpay on your taxes as well. I assume based on your reasoning that you give the government your entire income minus expenses. Governments have the ability to levy taxes. If they need money they should levy a tax. It's that simple. There is no 'right amount' that a company should be paying that is more than the law requires them to pay.

Except there's a difference between overpaying and short term tax minimisation.

I, for instance, in my country, am relatively conservative on my tax returns. I do not push everything out to the point of maximal complexity & maximal returns.

The reason I do this is twofold. If my accountant makes a mistake or a bad call, I am still personally liable for the tax I didn't pay + penalties, even though I sought and obtained professional advice. I know of cases now where people have received "audit shocks" where it turns out the government disagrees with how far they're pushing things, and now they owe money + penalties. Increase that sting and those penalties and watch the risk/return equation change.

The other two reasons are: I pay to support local community and infrastructure. I don't mind paying a bit extra to support public transport in my area, for instance, so if I can find a way to make targeted contributions (as opposed, say, my money going to a contractor in Iraq), then I'll put a bit more in.

And the third reason I don't pay minimal taxes it's a form of social contract/political insurance. I know that if I'm a total prick, or want to do things in the future, if I haven't paid my share, or if someone wants to audit me and go through my books as a political game or to make a point, I have far more political capital and support from the population of I show I'm a good citizen vs "I basically will fuck you all to the maximum extent and screw you". This also provides me a clean conscience, legitimacy, authenticity, and general good will.

Plus if anyone does audit me, for political reasons or otherwise, maybe I'll get a small refund or ruling in my favour, which, at such times, I could really use...

Re: Spanish authorities raid Google offices over tax

#333

Post by edc117 » Fri, Jul 01, 2016, 12:38 AM UTC

dailo10 wrote: post #257

melenaboija wrote: post #111

I don't think there is a justification for big corporations to do what they do and they have to be pursued. I've been working for a bank in a tax haven in Europe and I've seen that financial engineering powerful people use has been a known and accepted tool for the governments for a while, and now that Europe is living a financial crisis governments start asking. These companies play in an absolutely different league…

There are multiple aspects at play here: 1. Fiduciary responsibility - Corporations have a financial objective to minimize their tax burden, in order to maximize shareholder value. Sure. 2. Legality. There are numerous loopholes that are technically legal. And it's remarkable how much gray area there is when it comes to tax law. This is why you have the big teams of lawyers to figure out how to best game the system a…

The truly frustrating part to the average taxpayer is the one-sidedness of how the law develops. I have politicians telling me that TTP is vital and needs to pass, so we get strong protections for IP, more revenue for these american companies, blah blah. But when it comes to making laws to tax those same companies, well there's lots of issues, it's very complex, we need to study it for a long while.

It's very clear who lawmakers are looking out for.

Re: Spanish authorities raid Google offices over tax

#334

Post by hueving » Fri, Jul 01, 2016, 1:35 AM UTC

sbov wrote: post #270

hueving wrote: post #238

Earlier quoted context omitted.

You are free to overpay on your taxes as well. I assume based on your reasoning that you give the government your entire income minus expenses. Governments have the ability to levy taxes. If they need money they should levy a tax. It's that simple. There is no 'right amount' that a company should be paying that is more than the law requires them to pay.

I would love to give all my income minus expenses. I could easily make it so I have zero after my expenses. But that's not how things work for individuals... and that's a large part of the difference.

>I would love to give all my income minus expenses. I could easily make it so I have zero after my expenses. But that's not how things work for individuals...

Of course that's how it works. There is nothing that stops you from donating extra to the government. If you really wanted to you could easily do it.

Re: Spanish authorities raid Google offices over tax

#335

Post by hueving » Fri, Jul 01, 2016, 1:39 AM UTC

bobwaycott wrote: post #306

Pyxl101 wrote: post #294

Earlier quoted context omitted.

> The effort a corporation expends to avoid taxes, such as those under scrutiny in the matter at hand, are not at all homologous to electing to take a dependent exemption for an individual citizen. Reducing one's tax bill via deductions and elected credits is not the same as going to great lengths to create special structures that enable a corporation to avoid tax bills altogether. You've said it's not the same. How…

What is lawful != what is ethical. Most of my comments in this thread and on this subject engage the ethical responsibilities of citizens and corporations to their societies, and their parts in the establishment and perpetuation of just and healthy societies. Beyond that, there is quite an orders of magnitude difference between electing to take an individual deduction as a citizen and establishing complicated structu…

>If you do not see these things are different, I doubt I could convince you otherwise.

If you can't articulate why they are different, then perhaps the distinction isn't as clear as you seem to think.

Why do you think a person incorporates a small business instead of operating as a sole proprietor? Why do you think small businesses save all kinds of receipts and pay accountants to ensure they are maximizing expenses?

Re: Spanish authorities raid Google offices over tax

#336

Post by CydeWeys » Fri, Jul 01, 2016, 1:46 AM UTC

kuschku wrote: post #149

CydeWeys wrote: post #70

Earlier quoted context omitted.

I don't see how you can possibly make this comparison. What VW did is so much worse than legal but creative tax strategies. VW deserves to pay for all of the harm it did to the environment and our lungs.

Yes, just like GM, BMW, Mitsubishi, Hyundai, Ford, Fiat do. All of which bought and used the exact same defeat device. So why is only VW being punished, and why almost 1.5 years after the EPA learnt about it?

Do you have a source? Those are extraordinary claims. I'm not aware of any other cheating anywhere close to the magnitude of what VW did. Also, what "defeat device" are you talking about? VW's cheat was in software; it wasn't some specific device.

And are you seriously surprised that it can take 1.5 years for a massive multi-billion dollar lawsuit to wind its way through federal courts? If you think 1.5 years is long, look at the Exxon-Valdez settlement, parts of which are still unpaid 28 years later!

Re: Spanish authorities raid Google offices over tax

#337

Post by bobwaycott » Fri, Jul 01, 2016, 2:02 AM UTC

hueving wrote: post #335

bobwaycott wrote: post #306

Earlier quoted context omitted.

What is lawful != what is ethical. Most of my comments in this thread and on this subject engage the ethical responsibilities of citizens and corporations to their societies, and their parts in the establishment and perpetuation of just and healthy societies. Beyond that, there is quite an orders of magnitude difference between electing to take an individual deduction as a citizen and establishing complicated structu…

>If you do not see these things are different, I doubt I could convince you otherwise. If you can't articulate why they are different, then perhaps the distinction isn't as clear as you seem to think. Why do you think a person incorporates a small business instead of operating as a sole proprietor? Why do you think small businesses save all kinds of receipts and pay accountants to ensure they are maximizing expenses?

Who says I can't articulate the difference? You seem to be incapable of avoiding jumping to some seriously erroneous conclusions throughout our exchange here. I most certainly can articulate the difference, and have succinctly done so more than once while reiterating what specifically I am targeting with my comments—a target you continue to ignore and brush aside. You seem to want to argue. I see no indication that writing hundreds of more words will move the needle of this discussion. You make assertions and ask questions that are wholly divorced from my point, and seem to somehow entirely miss the point of every statement I've made.

For your edification, I run a business. I do not pursue complicated measures or hire accountants to minimize or avoid taxation, maximize expenses, or anything similar. I practice what I preach, as the saying goes. And such behavior is entirely counter to everything I'm saying is important here.

Re: Spanish authorities raid Google offices over tax

#338

Post by newjersey » Fri, Jul 01, 2016, 2:14 AM UTC

edc117 wrote: post #333

dailo10 wrote: post #257

Earlier quoted context omitted.

There are multiple aspects at play here: 1. Fiduciary responsibility - Corporations have a financial objective to minimize their tax burden, in order to maximize shareholder value. Sure. 2. Legality. There are numerous loopholes that are technically legal. And it's remarkable how much gray area there is when it comes to tax law. This is why you have the big teams of lawyers to figure out how to best game the system a…

The truly frustrating part to the average taxpayer is the one-sidedness of how the law develops. I have politicians telling me that TTP is vital and needs to pass, so we get strong protections for IP, more revenue for these american companies, blah blah. But when it comes to making laws to tax those same companies, well there's lots of issues, it's very complex, we need to study it for a long while. It's very clear w…

> The truly frustrating part to the average taxpayer is the one-sidedness of how the law develops. I have politicians telling me that TTP is vital and needs to pass, so we get strong protections for IP, more revenue for these american companies, blah blah. But when it comes to making laws to tax those same companies, well there's lots of issues, it's very complex, we need to study it for a long while.

Just to clarify, did you mean TPP, TTIP, both, or something else?

https://en.wikipedia.org/wiki/Trans-Pacific_Partnership

https://en.wikipedia.org/wiki/Transatlantic_Trade_and_Invest...

Re: Spanish authorities raid Google offices over tax

#339

Post by flukus » Fri, Jul 01, 2016, 3:06 AM UTC

tvanantwerp wrote: post #123

Trombone12 wrote: post #61

Earlier quoted context omitted.

No, the laws are complex when dealing with complex situations and ownership graphs of companies can be basically any finite directed graph. But obviously most ownership is a simple two node thing with a single directed edge connecting the nodes. These are simple to decide if they are legal.

Unfortunately, law can still be complex in what seems like a simple situation. Statutes aren't exactly written with strongly-typed languages or run against integration tests before being passed. Laws are often vague and difficult to precisely interpret, and they usually have unintended consequences. This is true regardless of the complexity of the situation to which the law is applied.

Integration/unit test would be great for law, we could easily see the intended scope and limits of legal changes.

Re: Spanish authorities raid Google offices over tax

#340

Post by yummyfajitas » Fri, Jul 01, 2016, 3:07 AM UTC

developer2 wrote: post #290

dailo10 wrote: post #257

Earlier quoted context omitted.

There are multiple aspects at play here: 1. Fiduciary responsibility - Corporations have a financial objective to minimize their tax burden, in order to maximize shareholder value. Sure. 2. Legality. There are numerous loopholes that are technically legal. And it's remarkable how much gray area there is when it comes to tax law. This is why you have the big teams of lawyers to figure out how to best game the system a…

1. This is why capitalism built on "everything to maximize revenue for shareholders" is broken. Maximize revenue by generating more revenue, not by evading - or avoiding - taxes. If your company cannot remain afloat without dodging taxes, your business is not viable and does not deserve to exist. 2. The fact that you can "game the system" and remain squarely in the "legal" column makes the system broken. 3. Consideri…

* You perform business in a country? Pay the taxes for all revenue factually originating in that country, not technically based on loopholes. If revenue originates from a customer/client/subsidiary in country X, you pay taxes in country X; you don't get to have customers in country X, but pretend like your business in country Y really took their money. Simple as that.*

You seem to be wanting a consumption tax rather than an income tax. This is known by economists to be the least distortionary tax, for the exact reason you argue.

It's also highly criticized by left wing types since it taxes people in proportion to the benefit they receive from society rather than what they produce for society. Typically poor people consume more than they produce, while rich people produce more than they consume.

Large companies that threaten to abandon doing business because state X or country X makes them pay tax? Farewell, we don't need you.

Except that very often, we do. Just look at Austin - as a result of their little feud with Uber/Lyft, they are now providing below sub-developing world level services.