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Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

theguardian.com

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Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#31

Post by oarsinsync »

kowlo wrote: post #15
deafcalculus wrote: post #9

Earlier quoted context omitted.

Isn't salary a deductible expense?

You're right - but it depends how and when you pay yourself... a balance of salary and dividends, where dividends are not deductible. For me I may have a good year followed by a weak year, so I use last year's profit to keep me going!

If you're in the UK and still using dividends as a significant method to self-compensate, you may benefit from speaking to a (better) accountant.

(Your circumstances may vary, this is not financial advice, YOLO, etc)

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#32

Post by nly »

tonfa wrote: post #4

Isn't the US levying corporate tax on worlwide income anyway (since the last tax reform). So it's "only" a matter of deciding whether those taxes should be paid in US vs. other countries (and if the intellectual property was developped mostly in the US, it seems fair for the US to get most of it).

Microsoft Ireland isn't a US company and therefore not subject to US laws. Presumably they're free to charge Microsoft USA whatever they want for their services and licensing their IP.

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#33

Post by tasogare »

fallingknife wrote: post #12

Why can't governments learn that taxing corporations is pointless? The same revenue is can be raised more simply through sales tax and personal income tax on salaries and distributions.

> Why can't governments learn that taxing corporations is pointless?

Pure ideological point of view with no grounding in reality. It's totally possible to tax corporations. In fact, some state like Japan and South Korean get more money from enterprises than individuals, the reverse of Europe and US (until recently consumption tax was 5% in Japan, now is 8%, still far less than EU's typical 20%).

The solution you propose doesn't even work well, since it's one more incentive for (mega-)corps to not raise salaries, as keeping salary low means also low taxes.

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#34

Post by ulzeraj »

neilwilson wrote: post #16
kowlo wrote: post #5

Meanwhile my (single-person) company is paying around 20% corporation tax, and then I'm getting taxed a further 20-40% on top of that when I pay myself.

Invest your surplus then you won't have any profit to be taxed upon. Which is what Microsoft is doing. Alternatively lobby your government to replace corporation tax with a company payable tax on the labour a company uses - which is actually what tax is for: to release manpower for the government use. Then Microsoft can't avoid it by profit shifting.

> company payable tax on the labour a company uses

Wouldn't that create a perverse incentive to hire less and overload the remaining employees? I say this because that's exactly what it does on my home country.

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#35

Post by one2three4 »

fallingknife wrote: post #12

Why can't governments learn that taxing corporations is pointless? The same revenue is can be raised more simply through sales tax and personal income tax on salaries and distributions.

I can assure you that on the personal income tax front and much more so at the indirect tax of cost of living the Irish govt is doing just fine thank you.

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#36

Post by breakfastduck »

fallingknife wrote: post #12

Why can't governments learn that taxing corporations is pointless? The same revenue is can be raised more simply through sales tax and personal income tax on salaries and distributions.

The revenue is only the same because we dont actually collect corporation tax because we let people avoid it.

To act like there's no additional benefit on taxing literally billions in revenue is absolutely nonsensical.

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#37

Post by cycomanic »

fallingknife wrote: post #12

Why can't governments learn that taxing corporations is pointless? The same revenue is can be raised more simply through sales tax and personal income tax on salaries and distributions.

Well this creates the incentive that corporations try to minimise their employees, or try to shift employment to low tax/low cost countries. Now that very well be desirable for corporations and people who derive income primarily from capital, but it is not desirable for society. The whole idea behind corporate tax is that they should be taxes on the profits they make, where they make them.

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#38

Post by adolph »

neilwilson wrote: post #25
fallingknife wrote: post #12

Why can't governments learn that taxing corporations is pointless? The same revenue is can be raised more simply through sales tax and personal income tax on salaries and distributions.

The best tax is one that is imposed on an individual but paid at source by the corporation paying them. Individuals shouldn't see tax. That way the voters don't complain when you need to put it up. Sales tax is similarly a pain - particularly when you have differing rates. At which point we get into the famous is it a cake or a biscuit type cases to decide where the dividing line is.

People not knowing their tax burden: feature or bug?

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#39

Post by waterglassFull »

malux85 wrote: post #2

I have to pay 40% of my income as income tax. I have HAD ENOUGH. This is infuriating. What can we do?

If you are fortunate enough to be in a position where you're earning enough to pay 40% tax then great for you!

Paying tax is good for society, what's not great is companies avoiding it. The latter doesn't negate the former.

Re: Microsoft Irish subsidiary paid zero corporate tax on £220bn profit last year

#40

Post by carlio »

weird-eye-issue wrote: post #30
kowlo wrote: post #10

Earlier quoted context omitted.

In the UK you only pay corporation tax on profit

Is there anywhere in the world that this isn't the case? I'm genuinely curious

In Estonia you pay taxes on distributed profit. If profit stays in the company it's not taxed.
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