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Facebook tax court trial begins over Ireland offshore deal

reuters.com

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Re: Facebook tax court trial begins over Ireland offshore deal

#181
post #108
post #89

Earlier quoted context omitted.

But if you as a citizen owe 1000USD, you'll be pursued more. Its completely messed up, but that's the current rules of the system. Without going into politics, they play by the stretched rules.

>But if you as a citizen owe 1000USD, you'll be pursued more. Is the IRS really auditing people over $1000 in taxes (under $4000 of revenue/income)?

https://www.propublica.org/article/irs-sorry-but-its-just-ea...

> On the one hand, the IRS said, auditing poor taxpayers is a lot easier: The agency uses relatively low-level employees to audit returns for low-income taxpayers who claim the earned income tax credit. The audits — of which there were about 380,000 last year, accounting for 39% of the total the IRS conducted — are done by mail and don’t take too much staff time, either. They are “the most efficient use of available IRS examination resources,” Rettig’s report says.

https://www.propublica.org/article/earned-income-tax-credit-...

> Since Smick, who is taking classes toward a bachelor’s degree, and her husband, a chef, together earned around $33,000 in 2017, about $2,000 of that refund would come from the earned income tax credit. [...] But no refund came. Instead, she got a letter from the IRS saying it was “conducting a thorough review” of her return.

https://www.propublica.org/article/whos-afraid-of-the-irs-no...

> the same year that Facebook started moving profits to Ireland, the IRS launched a team to crack down on deals like that. The effort started aggressively. [...] But shortly after the IRS showed this new ambition, Republicans in Congress, after taking the House in 2010, began forcing cuts to the IRS’ budget. Over the years, as Facebook grew into one of the world’s largest companies, with 2 billion users, the IRS was shrinking. By the time the IRS finally took on Facebook over its Irish deal a few years later, the agency was in over its head.

Re: Facebook tax court trial begins over Ireland offshore deal

#182

Surely this is more about political coercion than tax? Amongst all US companies that offshore profits, including the likes of Halliburton, Facebook has been singled out because the US administration wants the company to do it's bidding regarding policy and algorithms for political advertising? Especially considering all the other political reprisals and pardons that are in the news, following the impeachment acquitta…

A lot of unfounded speculation in your comment. It seems more politically-motivated than rooted in facts. Secondly, have you done your research? Surely Facebook is not the only company being targeted by the government right now. I can assure you that, surely there are more. Thirdly, as much as I might dislike an administration, I won't take the giant, speculative leap as to assume that I know exactly what they're thi…

do you really think that this isn't a case of selective law enforcement?

the IRS is famously understaffed, why Facebook? why not Apple? or Amazon? or will they go after them next??

edit: and google?

Re: Facebook tax court trial begins over Ireland offshore deal

#183
post #170

Earlier quoted context omitted.

Good comment, and good way of looking at things. However, currently it's not possible to obtain a lot of facts about the inner workings of this administration, since it is effectively above the law in terms of things like subpoenas.

The subpoenas you're talking about were purposely not taken to court.

Some were, and based on the timeline provided by the District Court it was clear that it would be nearly impossible for the matter to be resolved expediently. i.e.: before the next election, which the President was alleged to have abused his power to interfere in. It would rely on Congress trusting that the Supreme Court would deviate extraordinarily from its normal process and decide a matter in a very short time.

And on top of this, Congress has the power to grant subpoenas. The Supreme Court has affirmed this right since the 19th Century and it's absurd that defenders of the President keep insisting that every subpoena must be fought in court, all the way up to final appeal, in order to be valid. That is expressly not what Courts have said in the past. See: https://www.scotusblog.com/2019/07/cases-and-controversies-c...

Re: Facebook tax court trial begins over Ireland offshore deal

#184
post #139

Earlier quoted context omitted.

I think there's room to argue that intentionally shipping all your IP to a lower tax country then charging the main company (that developed that IP in the first place) high fees to use that IP as a way to shift profits from higher tax areas to lower tax areas could constitute fraud. Either they sold/transferred the IP for way to little or they're charging themselves way too much because it's advantageous for taxes.

Here's the million/billion/trillion dollar question: how much is a brand worth? Clearly it is worth something. Facebook can do the most inane thing, but if they put their brand on it then it will have some value. To me this is the flaw in corporate taxation. I don't think you can ever work around this as long as you allow free trade. It just makes sense to tax them in other ways instead and perhaps simply get rid of…

That is the tough bit for sure in trying to tell up front if an IP transfer is just a setup for tax avoidance. You can tell after the fact though just by seeing how much the company claims it's worth to use.

A VAT style tax probably solves that right? It doesn't care how much money you actually make so you can't slip profits out the back door as costs.

Re: Facebook tax court trial begins over Ireland offshore deal

#185
post #170

Earlier quoted context omitted.

Good comment, and good way of looking at things. However, currently it's not possible to obtain a lot of facts about the inner workings of this administration, since it is effectively above the law in terms of things like subpoenas.

The subpoenas you're talking about were purposely not taken to court.

Because they'd be stuck there for years.

This emoluments suit has been going since 2017 and got tossed on appeal via a technicality instead of being evaluated on merits, for example, and it hasn't even gone to SCOTUS yet: https://www.politico.com/news/2020/02/07/appeals-court-rejec...

Re: Facebook tax court trial begins over Ireland offshore deal

#186
post #144

Earlier quoted context omitted.

> Surely this is more about political coercion than tax? What's the difference? It good anyway for the US because it would set an important precedent for future litigation on the matter of profit offshoring.

I think the problem is the precedent would effectively be "Do what the president says or we'll single you out for punishment".

and it was'nt this case in previous administrations?

Re: Facebook tax court trial begins over Ireland offshore deal

#187
post #158

Earlier quoted context omitted.

Except Facebook makes most of its money from US users not from international users. Also hard to argue that their campus that houses the majority of their employees in the US isn’t the one generating the IP.

> Except Facebook makes most of its money from US users not from international users. Source? 96.75% of the world population is outside the US, of Facebook users it will be a smaller percentage, but it seems highly unlikely that most of the revenue will come from such a narrow base.

What a weird way to approach that claim. The population inside or outside the USA plays a tiny role. a) China and Russia aren't involved, so strike 2bn from that b) it's not about people "existing", it's about people being a customer (or product, whatever view you prefer), facebook is obviously more widespread in a first world, high tech society where practically everyone has a smartphone than in some thirld world country where electricity is rare and unstable and c) revenue per user. statista [1] claims it's much, much higher than in the rest of the world. With that coming in at a 3:1 or 4:1 or even 5:1, that alone would make the US a heavy weight in revenue.

[1] https://www.statista.com/statistics/251328/facebooks-average...

Re: Facebook tax court trial begins over Ireland offshore deal

#189

Surely this is more about political coercion than tax? Amongst all US companies that offshore profits, including the likes of Halliburton, Facebook has been singled out because the US administration wants the company to do it's bidding regarding policy and algorithms for political advertising? Especially considering all the other political reprisals and pardons that are in the news, following the impeachment acquitta…

Are you saying Facebook isn't doing its bidding on political advertising? From what I've seen, FB has been the most welcoming of the social media platforms.

Re: Facebook tax court trial begins over Ireland offshore deal

#190

Surely this is more about political coercion than tax? Amongst all US companies that offshore profits, including the likes of Halliburton, Facebook has been singled out because the US administration wants the company to do it's bidding regarding policy and algorithms for political advertising? Especially considering all the other political reprisals and pardons that are in the news, following the impeachment acquitta…

Not the same ballpark.

https://www.macrotrends.net/stocks/charts/HAL/halliburton/ne...

https://www.macrotrends.net/stocks/charts/FB/facebook/net-in...

https://www.macrotrends.net/stocks/stock-comparison?s=net-in...

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