It's time to give up on shaming big tech companies for their low tax rates • Hacker News Board

Re: It's time to give up on shaming big tech companies for their low tax rates

#41

Post by beagle3 » Mon, Apr 30, 2012, 5:16 PM UTC

Retric wrote: post #28

swombat wrote: post #8

Earlier quoted context omitted.

Is exploiting tax loopholes really unethical? Some would argue that the government is the biggest waste of money there is. I'm not saying that's my belief, but let's entertain that thought for a minute. If you believe that the government wastes most, say 95%, of its money on stupid things that should never receive a dollar from anyone (like the war in Iraq, to pick a random one), and you believe that you personally c…

Suppose 95% of what the Bill Gates foundation does is pure waste, should we raise taxes so his money is better spent? If you assume your correct you can make anything sound reasonable. However, despite popular opinion the US government is reasonable efficient given it's size, it's the goals that are poorly thought out not it's methods. If you want to suggest otherwise you need to compare total income with total outpu…

> the US government is reasonable efficient given it's size,

Do you have a reference for that? Genuinely interested.

I've dealt only with a small part of the US and State government, and all of those were horrendously inefficient (e.g., refusing electronic filing of documents; turns out that I type it in on my computer, print it onto the pre-made form, send it by regular mail; someone at the other end manually types it all in. That happens with quite a few US government forms).

Re: It's time to give up on shaming big tech companies for their low tax rates

#42

Post by jbooth » Mon, Apr 30, 2012, 5:16 PM UTC

olalonde wrote: post #29

jbooth wrote: post #15

Earlier quoted context omitted.

Difference being that Real People can't spend 10 million setting up foreign subsidiaries in order to avoid taxation on a billion in income. Different math comes into play when you can fill an office building with lawyers for your tax policy.

On the other hand, they can much more easily pass under the radar.

But then you're talking fraud and running a big risk.

Re: It's time to give up on shaming big tech companies for their low tax rates

#43

Post by rprasad » Mon, Apr 30, 2012, 5:17 PM UTC

clarky07 wrote: post #23

jbooth wrote: post #14

Earlier quoted context omitted.

It's unethical because we're all on the hook for the money the government spends. That's the social contract. If you think the war in Iraq was a big waste of money (as I do), then great, lobby against that. But once the decision's made, we're all on the hook for the money and wiggling out is akin to welching on a bet or defaulting on a loan when you have the money to pay. Funnily enough, most of the people who compla…

There is nothing unethical about following laws as they are written. The thing to lobby against is the absurd tax code we have in the US. If the tax code wasn't 16k pages we wouldn't have this "problem." You could put all the information needed on 1 page, and we wouldn't have to read these stories in the news anymore.

Ethics and legality are not the same thing. For example, it is legal for judges to hit up parties before their court for campaign donations. However, it is not ethical for them to do so.

Re: It's time to give up on shaming big tech companies for their low tax rates

#44

Post by [deleted] » Mon, Apr 30, 2012, 5:17 PM UTC

cletus wrote: post #30

I disagree with the premise that legally avoiding tax is somehow unethical or wrong (or otherwise something to be shameful for). There's a strong counterargument that not voluntarily handing over money you don't need to is resisting the tyranny of government. The real problem here is twofold: 1. The tax system is too complicated and continues to get more complicated with special interest riders and so forth; and 2. L…

[deleted]

Re: It's time to give up on shaming big tech companies for their low tax rates

#45

Post by clarky07 » Mon, Apr 30, 2012, 5:20 PM UTC

jbooth wrote: post #40

clarky07 wrote: post #23

Earlier quoted context omitted.

There is nothing unethical about following laws as they are written. The thing to lobby against is the absurd tax code we have in the US. If the tax code wasn't 16k pages we wouldn't have this "problem." You could put all the information needed on 1 page, and we wouldn't have to read these stories in the news anymore.

Nothing unethical about following laws as they are written? That's a silly absolute. What about the nuremberg trials? There's all sorts of unethical things you can do legally, and if you have a bunch of lobbyists working to change the law in your favor, there's even more.

That's a pretty big stretch of what I was talking about going from taking a deduction to murdering people. Would you feel better if I said there is nothing unethical about following our current tax laws? As it is the rich pay far more in taxes than what they make relative to the total so I have no problems with them working to minimize their tax bill just as I do. They simply have more resources with which to minimize their bill. They still pay far far more in taxes.

Re: It's time to give up on shaming big tech companies for their low tax rates

#46

Post by archgoon » Mon, Apr 30, 2012, 5:23 PM UTC

jemka wrote: post #19

archgoon wrote: post #9

Earlier quoted context omitted.

What do you feel should be cut in government? Where do you feel that money is being misappropriated?

>What do you feel should be cut in government? Where do you feel that money is being misappropriated? I'm not for big government. So, I wouldn't go department by department and audit to find fraud, waste, and abuse. I used to get paid to do that for the defense department. It's a complete waste of time and ultimately a paper drill. But what I want is moot. What I don't understand is why many others sit idly by and ar…

I like the contractual accountability idea.

However, I'd like to point out that term limits is making government less like a business. Imagine you told a CEO 'Well, you're here for 4, maybe 8 years, but no longer." Zuckerberg's term would be over in 2014, Jobs wouldn't have been able to return (or would have stopped in 2005 if you just want to count his return in 1997).

That's not to say that term limits are a bad idea (however, I'm unimpressed with their implementation in California), just that I don't think that people really feel comfortable with having a government, that can make it's own rules, run itself like a business.

Re: It's time to give up on shaming big tech companies for their low tax rates

#47

Post by [deleted] » Mon, Apr 30, 2012, 5:23 PM UTC

jemka wrote: post #19

archgoon wrote: post #9

Earlier quoted context omitted.

What do you feel should be cut in government? Where do you feel that money is being misappropriated?

>What do you feel should be cut in government? Where do you feel that money is being misappropriated? I'm not for big government. So, I wouldn't go department by department and audit to find fraud, waste, and abuse. I used to get paid to do that for the defense department. It's a complete waste of time and ultimately a paper drill. But what I want is moot. What I don't understand is why many others sit idly by and ar…

[deleted]

Re: It's time to give up on shaming big tech companies for their low tax rates

#48

Post by clarky07 » Mon, Apr 30, 2012, 5:23 PM UTC

rprasad wrote: post #39

cletus wrote: post #30

I disagree with the premise that legally avoiding tax is somehow unethical or wrong (or otherwise something to be shameful for). There's a strong counterargument that not voluntarily handing over money you don't need to is resisting the tyranny of government. The real problem here is twofold: 1. The tax system is too complicated and continues to get more complicated with special interest riders and so forth; and 2. L…

(1) The tax system is very simple if you're not trying to game the system to (EDIT: changed from "or") minimize your tax burden. Almost all of the complexity arises from the allowance for deductions and the related regulations necessary to prevent abuse of those deductions. (2). Worldwide, that is the standard tax practice. It is called "territorial taxation." Source-based taxation is the U.S. practice regarding fore…

>(1) The tax system is very simple if you're not trying to game the system or minimize your tax burden. Almost all of the complexity arises from the allowance for deductions and the related regulations necessary to prevent abuse of those deductions.

How is taking deductions "gaming the system?" Why on earth would I not try to minimize my tax burden. The US government is not a charity, and it functions far worse than most charities do. If I'm just going to give money away, the government is not going to be my first choice for recipient.

Re: It's time to give up on shaming big tech companies for their low tax rates

#49

Post by gte910h » Mon, Apr 30, 2012, 5:24 PM UTC

newbie12 wrote: post #22

There is no such thing as taxing a "corporation." Corporations are owned by shareholders, and those shareholders pay taxes on the money they invest and in-turn on the gains from that investment. Taxing corporation profits is double-taxation. The proper corporate tax rate should be zero. It is crazy that the government runs myriad business and job subsidy programs while also tax penalizing the most successful, forward…

>The proper corporate tax rate should be zero

I actually suggest you do something that ends double taxation and the capital gain tax tier:

http://en.wikipedia.org/wiki/Dividend_imputation

This is why:

>Elimination of Tax Incentives >It is also interesting to note that it was soon realised that the system eliminated to a considerable extent the effectiveness of tax incentives for corporations. If a corporation was given a tax break then its incomes thus released from taxation would not generate franking credits precisely because no tax was paid. In turn, this meant that the shareholders received fewer credits along with their dividends, meaning in turn that they had to pay more tax. The net result is that each tax break a corporation itself got was countered by a matching increase in the tax burden of shareholders, leaving shareholders in exactly the same position had no tax break been received by the corporation. Thus, to the extent that corporate directors acted so as to increase shareholder wealth, tax incentives would not influence corporate behaviour.

Re: It's time to give up on shaming big tech companies for their low tax rates

#50

Post by jbooth » Mon, Apr 30, 2012, 5:25 PM UTC

clarky07 wrote: post #45

jbooth wrote: post #40

Earlier quoted context omitted.

Nothing unethical about following laws as they are written? That's a silly absolute. What about the nuremberg trials? There's all sorts of unethical things you can do legally, and if you have a bunch of lobbyists working to change the law in your favor, there's even more.

That's a pretty big stretch of what I was talking about going from taking a deduction to murdering people. Would you feel better if I said there is nothing unethical about following our current tax laws? As it is the rich pay far more in taxes than what they make relative to the total so I have no problems with them working to minimize their tax bill just as I do. They simply have more resources with which to minimiz…

Warren Buffett and his secretary would like a word with you.

My income has FICA and Medicare taken out of about 90% of the total, those taxes are capped. If I made more, I'd be paying less as a % of income for entitlements. My income is taxed at the personal income rate as opposed to the silly-low capital gains rate.

Our tax code taxes the poor almost nothing, and the rich at a smaller % of their incomes than the middle class. So the middle class is paying a huge % of the tax burden, relative to their incomes. Then someone goes "Hey, look, the poor pay almost nothing!" and people get mad about the injustice.