41–50 of 103 posts
The big players (none of which are tax havens) certainly would have an interest in building it, and in giving it power.
Earlier quoted context omitted.
Same thing played out with Amazon. The embedded 7-9% sales tax advantage gave them a massive price advantage (even if the headline price is the same, the price the consumer pays is less) that retailers couldn't keep up with.
You forget the effects of the "full reinvestment" policy. Amazon barely paid any tax at all. Not on sales, not on storage space, not on profits, not on ... (note: Jeff Bezos DID get enough money out of it to become the richest man on earth, but not through profit. Rather he got "capital gains on his shares", which is the same thing in practice, but a very different thing for the IRS. Oh, and since it's "paper profits…
Earlier quoted context omitted.
Same thing played out with Amazon. The embedded 7-9% sales tax advantage gave them a massive price advantage (even if the headline price is the same, the price the consumer pays is less) that retailers couldn't keep up with.
You forget the effects of the "full reinvestment" policy. Amazon barely paid any tax at all. Not on sales, not on storage space, not on profits, not on ... (note: Jeff Bezos DID get enough money out of it to become the richest man on earth, but not through profit. Rather he got "capital gains on his shares", which is the same thing in practice, but a very different thing for the IRS. Oh, and since it's "paper profits…
That's wrong and impossible to support in fact. You can spot a fraudulent claim like that easily because it wings an arbitrary number that on the surface appears absurd (and as it turns out, is).
Tax Microsoft at the OECD median, their net income for 2018 would be about ~$25 billion. Their tax rate for Q1 was 14%, which is comparable to the effective corporate tax rate in much of Europe.
So you don't like their 14% rate and think it's too low? How would raising that to 18% or 20% change anything fundamentally? It wouldn't. And it certainly wouldn't "rapidly shrink [them] to 10% of their current size." Whether their net income is $23b or $26b or $28b annually, Microsoft remains worth a similar value as to what they are today (ie well over half a trillion dollars).
The same holds true for Facebook, Apple and Google.
Making ridiculous claims without anything supporting them, doesn't make for a very good argument position.
Question: why isn’t there an international entity that is to tax-law normalization as WIPO is to IP-law normalization, that could—like WIPO—punish offending non-members by requiring members to impose trade sanctions on them? The big players (none of which are tax havens) certainly would have an interest in building it, and in giving it power.
Earlier quoted context omitted.
You forget the effects of the "full reinvestment" policy. Amazon barely paid any tax at all. Not on sales, not on storage space, not on profits, not on ... (note: Jeff Bezos DID get enough money out of it to become the richest man on earth, but not through profit. Rather he got "capital gains on his shares", which is the same thing in practice, but a very different thing for the IRS. Oh, and since it's "paper profits…
What is the 20% subsidy that other companies couldn't also have? Other companies could reinvest all their profits and pay close to no taxes as well, right?
Question: why isn’t there an international entity that is to tax-law normalization as WIPO is to IP-law normalization, that could—like WIPO—punish offending non-members by requiring members to impose trade sanctions on them? The big players (none of which are tax havens) certainly would have an interest in building it, and in giving it power.
Earlier quoted context omitted.
Same thing played out with Amazon. The embedded 7-9% sales tax advantage gave them a massive price advantage (even if the headline price is the same, the price the consumer pays is less) that retailers couldn't keep up with.
You forget the effects of the "full reinvestment" policy. Amazon barely paid any tax at all. Not on sales, not on storage space, not on profits, not on ... (note: Jeff Bezos DID get enough money out of it to become the richest man on earth, but not through profit. Rather he got "capital gains on his shares", which is the same thing in practice, but a very different thing for the IRS. Oh, and since it's "paper profits…
> You forget the effects of the "full reinvestment" policy. Amazon barely paid any tax at all
Is there anything stopping other companies, Amazon competitors like Wal-Mart or otherwise, from following this same policy? If no, your claim that companies like Amazon are government sponsored holds no water.
> Jeff Bezos DID get enough money out of it to become the richest man on earth, but not through profit. Rather he got "capital gains on his shares", which is the same thing in practice, but a very different thing for the IRS
Except it is not even remotely close to the same thing in practice. Jeff Bezos doesn't have $150B sitting in a bank account somewhere. How do you propose to tax money that he doesn't have access to? The very second he accesses any of it by selling shares, it is taxed. Are you proposing that everyone who has any kind of appreciating investment (so, anybody with a 401k) annually pay taxes out of pocket on the gains? You're going to piss off a lot of ordinary Americans if so.
> People think the internet businesses got successful because it's "just a better way to do business", but it gets a ~20% government subsidy. 30% if hailing from China (for instance, free shipping really is free from China, or I should say, paid by the US taxpayer mostly)
You completely lost me here. Where is this 20% government subsidy for being an "internet business" coming from? As somebody who's helped run an "internet business" I wasn't aware of such a subsidy, was I completely missing out??
And as somebody who currently is working on supply chain logistics involving shipping items to the US from China, I was also unaware that there was a program where the US taxpayer would fund our costs. Can you point me to such a program please? It would help me tremendously.
> Microsoft, selling software "locally" (ie. tax free in the Bahamas) but internationally, and even more so, Yahoo, Facebook, Google, ... selling services "locally" (in Delaware, Ireland and the Bahamas) is a homongous tax loophole.
This is the only part of your comment which seems grounded in reality - big corps absolutely take advantage of fancy accounting and overseas tax havens. What this has to do with "internet businesses" is utterly beyond me.
> As an analysis of the cost structures of these companies will tell you : if these loopholes were all closed, the internet "revolution" would end. All these companies would rapidly shrink to 10% of their current size. This seems absurd to many, but rewriting the financial statements of these companies taking normal tax structures into account will tell you this.
To make such a bold claim, surely you've done such an analysis, or at least have read such an analysis that you can link to?
Large companies should be taxed where the value is created. And because that’s hard to measure, cost should be used instead. So if Google spends 60% of its budget in the US, 60% of its profits should also be attributed to the US. (Side note: the alternative of taxing profits where the revenue is generated does not make much sense as this would be equivalent to a sales tax.)
> Large companies should be taxed where the value is created. Tax land.
Earlier quoted context omitted.
Yes, making the use of tax havens illegal is very hard. It's basically a giant game of whack-a-mole, where the corporations have more people with stronger incentives working to get around the tax laws than the government has trying to write new ones. Here's a fun explanation of the kinds of hoops corporations will jump through to dodge taxes: https://en.wikipedia.org/wiki/Double_Irish_arrangement
>where the corporations have more people with stronger incentives working to get around the tax laws than the government has trying to write new ones. If the penalties were harsh enough, wouldn't it change this dynamic?
Large companies should be taxed where the value is created. And because that’s hard to measure, cost should be used instead. So if Google spends 60% of its budget in the US, 60% of its profits should also be attributed to the US. (Side note: the alternative of taxing profits where the revenue is generated does not make much sense as this would be equivalent to a sales tax.)
That said, this isn't rocket science. As the article points out, it's simply an unwillingness by the host countries to hold multinationals who utilize tax havens to account.