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Paradise Papers: Dear Tim Cook

projekte.sueddeutsche.de

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Re: Paradise Papers: Dear Tim Cook

#501

Post by yardie »

eru wrote: post #216
yardie wrote: post #200

Earlier quoted context omitted.

Somehow I doubt the person making $20k/year paying the government 20% would see it the same way as the person making $100k/year.

What do you mean? A few points, but I am not sure which one you are referring to: - interesting enough actual taxation in the US seems to be mostly flat in practice (after a certain threshold): rich people get more deductions and can hire lawyers to use all the loopholes - you can have a mostly fixed marginal rate of taxation on income, but still have progression in average rates. Eg give everyone $10k/year as an all…

I mean that flat-tax rates punish the poor. One may have to miss a meal to pay their taxes. The other will have a few less bottles of champagne to purchase.

Even in your follow up post as soon as we make provisions for the reality we live in the flat tax goes back to being a progressive tax, again.

So what we really need is a simpler progressive tax rather than a gradually complex flat tax.

Re: Paradise Papers: Dear Tim Cook

#502

Post by dennis_jeeves »

soVeryTired wrote: post #232
dennis_jeeves wrote: post #208

Got to chuckle when articles like this appear. Essentially it means this: I paid my taxes, you haven't. Translated it means ( in my opinion): I got robbed, but you didn't get robbed, and I feel envious of you. Taxes are an extortion by the government and it is fair game that anyone should try and evade it legally or otherwise. Extortion cannot be justified even if some of the money is used to deliver useful services…

Let me guess. You're in favour of private healthcare, private security, private education, and no social safety net. In short, nothing to aid social mobility, and nothing to restrain powerful people who have gained the upper hand. You know, to some of us, that libertarian utopia sounds like a fucking nightmare.

>You know, to some of us, that libertarian utopia sounds like a fucking nightmare.

Correct, nobody is obliged to help you. What a sense of entitlement!

So your only option is go ahead ask your government to arm twist rich people into funding your healthcare etc. ( and the rich includes the ones that have both legitimately and illegitimately obtained wealth).

Re: Paradise Papers: Dear Tim Cook

#503

Post by DomreiRoam »

sseveran wrote: post #458
DomreiRoam wrote: post #314

Earlier quoted context omitted.

I think they are often engaged in illegal activities but it is difficult to prove it. A company and its subsidiaries are different entities and when you do an IP transfer between them where a huge set of patent and trademark is exchanged for 1 euros and then used back for millions, one of the company has been wronged. Try to do the same shenanigan with a LTD and yourself and you will very fast see what the IRS (or eq…

This is just downright false. There is an entire field inside the tax world called transfer pricing. You cannot just transfer significant IP to a foreign entity for $1 and expect that you will only need to pay tax on that $1. The IRS will come up with its own determination of what the value of the transferred asset is if it disagrees with your valuation and assess taxes based upon that. Now companies and the IRS freq…

If we had a way to have a realistic transfer pricing we wouldn't have the result that we have now where systematically groups make the biggest profits in countries with low taxation. If we look Apple group, their most productive employee are all based in small island nations. So on an Iphone, conceived in the US, made in china, sold in EU the biggest share of the profits is made in Bermuda or tax heaven?

Re: Paradise Papers: Dear Tim Cook

#504

Post by [deleted] »

Cakez0r wrote: post #282
jitbit wrote: post #66

While I do agree with the point that "govs should fix taxes, not corporations"... Still. It's a fact that (at least in the EU where I live) the majority of tax burden ends up on small companies - mom & pop shops, little bakeries etc. Who simply can't afford these global tax avoidance tricks (or can't use them because they're "local") Not that this is wrong or right, just a fact you can't argue with. I run a small sof…

I'd like to see some specific examples of tax avoidance tricks that Apple are using. There are a few mentions of how the "techniques aren't affordable for small business", but what are the techniques?

[deleted]

Re: Paradise Papers: Dear Tim Cook

#506

Post by rescripting »

pc86 wrote: post #424
sjwright wrote: post #409

Earlier quoted context omitted.

Okay, let's start there: pass a law to require companies to report these tax loopholes.

Please explain the difference between "tax loophole" and "tax law."

Exactly. Tax loopholes are like exploits. If they were all enumerated somewhere nicely then we could just patch them up.

If you're planning on using exploits, you keep try and them secret. Once they are common knowledge they get patched (hopefully).

Re: Paradise Papers: Dear Tim Cook

#507

Post by pjc50 »

pc86 wrote: post #424
sjwright wrote: post #409

Earlier quoted context omitted.

Okay, let's start there: pass a law to require companies to report these tax loopholes.

Please explain the difference between "tax loophole" and "tax law."

With a so-called "general anti-avoidance rule" (GAAR) https://www.gov.uk/government/publications/tax-avoidance-gen...

Effectively if your tax arrangements are weird enough they have to be submitted to a judicial-like body to determine whether they are for some sort of legitimate business purpose or purely for the purpose of tax avoidance. An example: https://www.gov.uk/government/uploads/system/uploads/attachm...

"Paragraph C5.6.7 of the Guid ance states “[the GAAR] rejects the proposition that taxpayers have unlimited freedom to use their ingenuity to reduce their tax bills by any lawful means"

"The reward was structured in the following way: a purchase of gold for the Employees was funded by the Company; that gold was immediately sold by the Employees ; the Company’s liability to pay the third party gold supplier was settled by the Employees in return for a director’s loan account credit in favour of the Employees; in connection with the purchase of the gold a long term obligation was created under which the Employees were required in the future to pay to the trustees of the EBT an amount at least equal to the purchase price of the gold (plus indexation)."

Obviously this arrangement is nonsense and is purely for tax avoidance, so the GAAR cuts through the complexity and rules it unacceptable.

Re: Paradise Papers: Dear Tim Cook

#508

Post by tjbiddle »

brynx97 wrote: post #173
sschueller wrote: post #86

Earlier quoted context omitted.

Same goes for US individuals living abroad not having any business relations or even holdings in the US. Yet they are required to file and pay US taxes in addition to local taxes.

You can apply for the foreign earned income tax exemption. I work abroad, and I reclaimed all my US taxes for my income earned abroad.

While I agree, and have done the same in the past - You still have to file, and it's only the first $100k that is exempt.

Re: Paradise Papers: Dear Tim Cook

#509

Post by germanier »

valuearb wrote: post #449
germanier wrote: post #387

Earlier quoted context omitted.

I don't pay taxes half way across the world because I don't do business there. Apple does. They have employees in Germany and sell their products (including in their own stores). Of course the vast majority of value is not created there but in the US. However, it's not like they pay their full share of taxes there because on paper the value is largely created in a place that conveniently doesn't tax that.

They pay huge amounts of taxes to Germany in VAT and employment taxes. Their income taxes should be paid where they are based, Germany is trying to double dip here. Apples accounting for where profits are located has to be approved by tax authorities.

The point is that they don't pay those taxes where they are based either.

Additionally, they create some value in Germany (a small share but still large on Apple scales). Taxing income derived from that is not double-dipping.

Re: Paradise Papers: Dear Tim Cook

#510

Post by ptaipale »

germanier wrote: post #371
ptaipale wrote: post #332

Earlier quoted context omitted.

Most of the criticism (of Nike and Apple, for instance) isn't for breaking even the spirit of the law. Most often the companies are acting precisely as the law is intended to work, and criticism is based on a misunderstanding of what is turnover and what is profit, and how taxes should be calculated. Very commonly the complaint is that Nike (for instance) pays no corporate income tax to a country even though it sells…

It's perfectly OK if that company actually operates in that country. It is not OK if the only presence they have is a mailbox and the actual act of operation is done somewhere else. A taxation race to the bottom is not what the fundamental principles of the EU are about. At best they are an unwanted side-effect.

> It is not OK if the only presence they have is a mailbox and the actual act of operation is done somewhere else.

As I said, the very point of EU (free movement of goods and capital) is that it is perfectly OK to have just a mailbox presence (e.g. to handle warranty claims and such, a service which is sold to the actual operating company in another EU country) and have the actual operation done somewhere else.

I take benefit of this all the time; for instance, I buy things from amazon.de which has much lower prices than domestic companies. They just pay VAT, based on sales, to my country, on my country's tax rate, but they don't operate here.

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