Lots of business practices are considered legal but sleazy, and above-board companies won't engage in the them even if they increase profits - from high pressure sales tactics to child labor where it's legal. Why is it that companies like Google and Microsoft are given a pass on using their many-million dollar legal budgets to push the US tax burden onto the rest of us?
The Tax Haven That's Saving Google Billions
201–210 of 292 posts
Re: The Tax Haven That's Saving Google Billions
#202Google is "flying a banner of doing no evil, and then they're perpetrating evil under our noses," says Abraham J. Briloff, a professor emeritus of accounting at Baruch College who has examined Google's tax disclosures. Maybe it is the lawyer in me, but why wouldn't any international business do whatever it could legally do to minimize its taxes? I understand that governments might want to consider these as loopholes…
"Don't be evil" != "do no evil"
Many people confuse the latter for the original statement, when it was in fact the former.
Re: The Tax Haven That's Saving Google Billions
#203Google is "flying a banner of doing no evil, and then they're perpetrating evil under our noses," says Abraham J. Briloff, a professor emeritus of accounting at Baruch College who has examined Google's tax disclosures. Maybe it is the lawyer in me, but why wouldn't any international business do whatever it could legally do to minimize its taxes? I understand that governments might want to consider these as loopholes…
> Maybe it is the lawyer in me, but why wouldn't any international business do whatever it could legally do to minimize its taxes?
Evil is a moral judgment, not a legal one.
Re: The Tax Haven That's Saving Google Billions
#204Earlier quoted context omitted.
run amazing free services (search, Gmail, Google Earth, Google Maps, Google Finance, Google News, Google Voice, Google Reader, Feedburner, many many others). Also, they're internally investing in energy and robotics like the auto-driven cars thing None of those products/services would be possible but for the government spending taxpayer money to develop the infrastructure behind those services (the internet, roads, G…
Judging from this downvoted comment -- this discussion is overtaken by libertarian crowd (which I'm part of). Still it's not a good idea to down-vote comments that you do not agree with. Down-voting is intended for boring/offensive comments which you do not want to see in further discussions.
I feel fine downvoting comments with high scores that I disagree with, especially if there is no particularly strong argument in them. If they have low score then I leave them alone.
Re: The Tax Haven That's Saving Google Billions
#205I really don't understand why we allow these things. Letter vs. Intention of law should matter, right? I don't think a lot of the tax code and business rules were written with the idea that a company would actually span continents or maybe not even have a physical presence.
Re: The Tax Haven That's Saving Google Billions
#206Earlier quoted context omitted.
Yes, and those taxpayer educated employees go on to pay income tax...rather than drawing welfare (or whatever you call it in the UK). In general the better the education, the higher the pay and the greater the income tax revenue from those employed individuals.
Google is in the UK at all because we are a stable, developed economy with a well-educated workforce, good infrastructure and high consumer spending. It could pay no tax at all if it relocated all its operations to Somalia where there is no government. But it stays, why? Because it is in its advantage to do so. To take but not give, that counts as a parasite in my book. Fortunately we have a government now that ain't…
But it is giving, it's giving jobs.
Re: The Tax Haven That's Saving Google Billions
#207Are we missing something here, maybe? Google, as a legal entity, is really nothing more than a piece of paper in someone's filing cabinet. As a corporation, it is just a legal vehicle for shuffling around money and managing liability and ownership.
On the other hand, the people who work for Google are ... people. And I'm sure the great majority of them pay plenty of taxes (income, payroll, etc.) in whatever jurisdictions they live in.
One of the primary functions of Google-the-entity, is to get that money to the people. In doing so, Google-the-entity pays very little tax, but the people pay lots. So the money is taxed, government programs are supported, and all is well.
To put it a different way, Google's tax strategy can be considered as a way to minimize the effect of governments taxing their people twice.
Re: The Tax Haven That's Saving Google Billions
#208I had a distinct Randroid phase where I thought it was almost a moral obligation to avoid taxation. Now things are fuzzier for me. I make a truly decent wage. Not an earth-shattering one but a wage that beat the hell out of anything my mom made while I was growing up. I am a very fortunate man. Heinlein wrote a thing about freedom: "In terms of morals there is no such thing as a ‘state.’ Just men. Individuals. Each r…
Why don't you spend some of your own money directly on the causes that you like? About 1/3 of American taxes go to the military, and another 1/3 goes to non-means tested social support programs (not necessarily benefiting the poor). The amount going to better education opportunities for poor people is absolutely negligible, especially since the sitting government is hostile to school choice.
Think with your head, not your heart.
Re: The Tax Haven That's Saving Google Billions
#209Earlier quoted context omitted.
Which of the above services do you think wouldn't exist if Google avoided less tax? There's an opportunity cost of private companies paying less tax too - either someone else pays more tax which marginally decreases their ability to be productive and enterprising or something purportedly socially beneficial doesn't get paid for. Even coupled with inspired management, the profit motive doesn't ensure that an acquisiti…
Which of the above services do you think wouldn't exist if Google avoided less tax? You're going to have to explain to me how this is relevant. What Google is doing is legal which means that you're trying to make this an argument about ethics. My point is that Google provides real value to millions of people around the world and has the resources, both human and monetary, to make real progress in many areas of techno…
By adopting the "Don't be evil" motto Google makes this about ethics. If you say that you are going to hold yourself to an ethical standard, that means you will be judged by your ethics, not by your adherence to the letter of the law.
But really, the continuing argument that because you like Google Maps it's therefore better that Google gets to keep all of its tax euros out of the hands of underfunded public services is close to incoherent.
Unless you can show that those services are in the same sort of existential danger as high-end cancer treatment is in the UK, the argument is specious.
Re: The Tax Haven That's Saving Google Billions
#210Earlier quoted context omitted.
Agreed, I think Goldman Sachs has their effective rate down to less than 2%.
I had a hard time digesting this claim, I looked up on Google and found this: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a... In 2008, GS's effective tax rate was 1%!
Since someone needs to call bullshit on this discussion, I would like to point out that GS's 2008 income was roughly 94% lower than its 2007 income. In 2007 its tax liability was roughly 35% of pretax income. Good tax accountants can lower your liability, but there is no magic "get out of taxes" card besides losing money.
I'm not going to spend more time looking through the 2008 quarterlies, but I would guess they lost money in some of those quarters, creating a tax benefit. If you find that shocking, well I can also give you amazing advice to lower your tax rate to 0% but you may not enjoy it.
In 2009, Goldman's pretax earnings returned to its historical range and the company again paid ~30% income taxes. These financials are all public, you can look at them on the internet.