Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

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

theguardian.com

Post reply on HN
Print view View original

371–380 of 467 posts

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

#371

Post by rorykoehler »

Grustaf wrote: post #220
rorykoehler wrote: post #128

Earlier quoted context omitted.

25% is what I would expect. You're getting some of the other expenses back eventually (hopefully) in form of pensions, unemployment (if you ever need it) etc. Health itself is a service you are buying. I wouldn't call it a tax despite it being mandatory. I think taxes are too high and the system needs to be redesigned but I just think we need to be exact on our figures when we discuss this stuff.

You can expect whatever you want, but no middle class person pays as little as 25% in Europe, only the wealthy and the desperately poor get away that cheap.

I'm middle class and that's about what I pay (effective tax rate) in Germany. It's a bit less actually.

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

#372

Post by TimPC »

adolph wrote: post #292
TimPC wrote: post #217

Earlier quoted context omitted.

The original purpose wasn’t to hide taxation but to effectively get more money via interest by the government getting paid sooner.

As I understand it in the US, the average taxpayer’s experience is that of annual taxes but the reality is that taxes are paid quarterly and settled on an annual basis. The self employed see this more clearly. Those in employer-employee relationships don’t see it since the employer sends the quarterly check to the various income taxing jurisdictions. Any interest made from the temporary storage of cash is probably mo…

Historically individual taxes were annual while some business taxes were quarterly. In Canada, corporate income tax is annual but sales tax remittances are quarterly. The interest is favourable to government since it reduces the amount of debt it needs to carry for a time. Admittedly it’s small now but in the 80’s it was a very big deal. I admittedly have never ran payroll taxes for a business in the US so I don’t know how that in particular works. I do however know Milton Friedman came up with the idea of withholding while working for the government early in his career and he always claimed that it was motivated by interest.

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

#373

Post by gher-shyu3i »

apercu wrote: post #327

This is really, really, really a problem. I know a lot of us make decent money and we write large "checks" to the government because we're in high tax brackets, but seriously. The middle class has gotten smaller. If you live in a city a house costs a million dollars. Many people don't have adequate healthcare. Yet we are allowing the richest people in the world to have astronomical profits and pay no tax to help cove…

What do you recommend as a solution? Do you honestly think if MS and a few other companies paid more in tax things will magically get better? Do you trust the government to send that money properly? The problem runs much much deeper. This is only scratching the surface.

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

#374

Post by mohanmcgeek »

apercu wrote: post #327

This is really, really, really a problem. I know a lot of us make decent money and we write large "checks" to the government because we're in high tax brackets, but seriously. The middle class has gotten smaller. If you live in a city a house costs a million dollars. Many people don't have adequate healthcare. Yet we are allowing the richest people in the world to have astronomical profits and pay no tax to help cove…

- a government borrows heavily and spends on useless things that won't generate future revenue (unlike roads, education which would) - government raises taxes because they can no longer borrow to spend on things - companies decide to keep their international profits in international accounts because that money to their country seems foolish at that point. - somehow that's affecting the "poor" people in the said very rich country?

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

#375

Post by mohanmcgeek »

rmah wrote: post #230
sbennettmcleish wrote: post #7

220bn profit? Really? Surely they mean "revenue"

Microsoft did not even make that much revenue in the 2020 fiscal year. Total global revenues were $143B and total global net income (aka profit) was $44. It was the a very good year for Microsoft. But £220B (apx $310B) in profits is laughable. The reporters might have been looking at the "total assets" line of MSFT's financials, which was $301B at the end of FY2020. But you don't pay tax on total assets. Just specula…

Getting things right won't get them the outrage and in turn the clicks.

They know what they're doing

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

#376

Post by Supernaut »

rorykoehler wrote: post #296
cheph wrote: post #238

Earlier quoted context omitted.

Is Ireland not a democracy? Can't they vote to change their own tax laws if they have a problem with them?

We can and there is a huge swell of support for Sinn Fein a nationalist left wing party (the political arm of the IRA). The two centre right parties FF & FG (FFG) that have held power since Ireland gained independence are very pro the current taxation policy and have up until now had an iron grip on power due to a culture of voting for whoever your parents voted for. This is slowly changing. Loads of Irish people don…

Perhaps they continue to vote for 'FFG' on the grounds that unlike SF, they're not apologists for mass murder and terrorism?

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

#377

Post by rorykoehler »

Supernaut wrote: post #376
rorykoehler wrote: post #296

Earlier quoted context omitted.

We can and there is a huge swell of support for Sinn Fein a nationalist left wing party (the political arm of the IRA). The two centre right parties FF & FG (FFG) that have held power since Ireland gained independence are very pro the current taxation policy and have up until now had an iron grip on power due to a culture of voting for whoever your parents voted for. This is slowly changing. Loads of Irish people don…

Perhaps they continue to vote for 'FFG' on the grounds that unlike SF, they're not apologists for mass murder and terrorism?

If you think that you don't know very much about recent Irish history. They all have significant blood on their hands, mostly due to their relationship with the Catholic Church.

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

#378

Post by bzbarsky »

rorykoehler wrote: post #75
jbverschoor wrote: post #64

Earlier quoted context omitted.

There you pay 40-50% incometax first

No one pays that much in a progressive tax system. Every time this discussion comes up people spout off these numbers but if you calculate out how much you actually pay it's probably in the 20-30% of total salary range. That's still high but it's just dishonest and makes people look like idiots when they throw around 40% etc. If you are truly paying 40% of your income in tax you are earning millions and are benefitin…

What's the effective tax burden on a self-employed single person making $300k in, say, Massachusetts (5% income tax; not exactly the highest in the US)?

Based on 2020 US tax brackets, standard deduction, including the both sides of FICA (capped at the social security cap for the social security part) and the medicare extra tax they are paying, I am ending up at ~37-38% effective (not marginal; marginal is 43.8%) tax or so. This individual would in my mind be excused for claiming that they pay "40% in income taxes" and is not making "millions" (though obviously is not suffering financially).

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

#379

Post by czottmann »

pg5 wrote: post #277

Is it really that bad that Microsoft pursues all the legal means for minimizing their corporate tax? Microsoft employees pay the same rates as we do. Also, most people in this thread are Microsoft shareholders, unless they have some unusual choices for their retirement. 5% of SP500 is Microsoft stock, and SP500 tracking funds are a common pick.

It's unethical AF. Technically, it might be legal, but that doesn't make it less immoral. You know, from a societal standpoint.

It's not like they have to scramble to get by, unlike many people in those countries whose tax systems they (ab)use.

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

#380

Post by aembleton »

wwtrv wrote: post #313
aembleton wrote: post #233

Earlier quoted context omitted.

Tax based on value extracted from a country. For example, in the UK I would tax corporations based upon UK Sales - UK Costs. For this I would require Amazon to set up a UK subsidiary. Once they have set up a UK subsidiary then they will need to pay a corporation tax based on their total UK sales - UK costs. Sales are sales to the UK; any sales made to other countries, then no tax needed as those countries might (and…

It’s not really that simple to measure the ‘value’ extracted from a specific country. If we’re considering digital goods Amazon UK could just transfer the profits to Amazon Luxemburg by signing an IP licensing agreement etc. for the same amount they would be taxes on in the UK. So the UK entity would operate at a loss/zero profit. AFAIK many companies are already doing this.

Amazon Luxemburg is not a UK company, so it wouldn't feature in the UK costs. They would have to pay tax on UK sales - UK costs.

Import more (including IP) and you pay more tax unless you also increase your UK costs.

Post reply on HN