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

The time bomb in the tax code that's fueling mass tech layoffs

qz.com

Post reply on HN
Print view View original

641–650 of 991 posts

Re: The time bomb in the tax code that's fueling mass tech layoffs

#641

Post by fortenforge »

runako wrote: post #303
madaxe_again wrote: post #200

Earlier quoted context omitted.

That isn’t how legislation is passed. If anything, it needs a section about acceptable tar shingle application standards for roofs within 6 nautical miles of any heliport operated in a subarctic area on the west cost. Then it’s looking like a bill.

Just last year, Congress snapped to attention and wrote and quickly passed a bill to ban the eminent national security threat of a video-sharing app. That bill doesn't do anything else. Just a reminder that Congress, even now, can rapidly act on a laser focus when it is sufficiently motivated.

Perhaps not the best example to choose given that the president managed to fully ignore that law. Tik-Tok remains unbanned to this day despite there being no sale.

Re: The time bomb in the tax code that's fueling mass tech layoffs

#643

Post by azemetre »

systemf_omega wrote: post #609
warkdarrior wrote: post #97

Earlier quoted context omitted.

Software developers are already too expensive in US, so this applies some downward pressure on those salaries. Frankly the economy will be much better off when tech salaries equalize across geos, thus avoiding the deep whole US manufacturing is in (for example, manufacturing wages in Vietname are one tenth of US manufacturing wages, and thus it is better to open new plants there).

If you want equalized poverty, feel free to move to the EU. Say goodbye to owning a nice house, or building any kind of wealth - that's reserved for the old money class. In the US, software is one of the few remaining ways to achieve the American dream. I came to this country to work hard and earn money.

Weird, I live in the USA make $180k yet still can’t own a house and building wealth is extremely hard.

EU has better societal benefits than the US (access to healthcare, education, mandated vacation time (often starting at 3-4 weeks).

The vast majority of people care about living a life without suffering. In the US this is only reserved for the rich it seems.

Re: The time bomb in the tax code that's fueling mass tech layoffs

#644

Post by happyopossum »

devmor wrote: post #405
_heimdall wrote: post #376

Earlier quoted context omitted.

But what would trump have done if he retained the presidency and lost congress? That's also been pretty common over the last few decades if I'm mistaken, a president with one or both sides of Congress is reelected but Congress flips to the opposition party.

I would suppose that the Democrats would remove the policy regardless of who was in charge.

But they didn’t, so that supposition is bunk

Re: The time bomb in the tax code that's fueling mass tech layoffs

#645

Post by bawana »

Deferring depreciation and deductions decreases their value as inflation happens. So it is a double whammy-not only is your profit reduced this year (and the impact that has on your stock price or return to your private equity investors) butthe value of that deduction decreases over time. So it is not a 'wash'.

Re: The time bomb in the tax code that's fueling mass tech layoffs

#646

Post by throwaway173738 »

efitz wrote: post #490
demosthanos wrote: post #446

Earlier quoted context omitted.

No. It went into effect in 2022 [0], which means the timeline absolutely does track with OP's theory. That gives a hypothetical Trump term 2 a full year to fix it but also imposes enough of a time crunch that they could plan on sabotaging attempts to fix it by another party. I'm not saying it's the actual story, but the timeline does track. [0] Page 60, Sec 1306(e) sets the date: https://www.congress.gov/115/bills/hr…

I don’t think it really changes the narrative. 2020 was also a congressional election year, even had Trump won (as he appeared to want desperately) he could not have been assured of a Republican congress. My argument is simple: Occam’s Razor The Republicans in congress put the provision in solely as a gimmick to get past the CBO. Frankly I don’t think legislators in either party are competent enough to have foreseen…

I think you’re wrong that legislators are incompetent. They’re human, and they’ve spent much of their lives learning how to get votes, but they’re not incompetent. A lot of them aren’t malicious, but there seems to be a small group of people outside of the legislative branch who are hell bent on taking control at all costs. And if you want to keep the votes rolling in you have to work with those people or get primaried. The dysfunction follows from fear more than incompetence these days.

Re: The time bomb in the tax code that's fueling mass tech layoffs

#647

Post by hedora »

K0balt wrote: post #587
dragonwriter wrote: post #530

Earlier quoted context omitted.

No, the reason the "there is always an in-party Senate spoiler" effect (when they have a Senate majority) seems to be more true of Democrats is because it is more true of Democrats, and the reason is that when the two parties in rough balance by popular support (or even rough balance in Presidential electoral prospects, which has the same directional bias as the Senate but of lesser magnitude), the Republican Party h…

It’s also because republicans politically punish dissent, while it is more tolerated in the Democratic Party. The consequences of “disloyalty” are higher in the Republican Party.

This might change. After party leadership got 20% of democratic senators to vote for trump’s procedural blank check, the party’s approval rating dropped to 27%.

If it doesn’t change, I suspect the party will split.

Re: The time bomb in the tax code that's fueling mass tech layoffs

#648

Post by xyzzyz »

throwaway173738 wrote: post #639
xyzzyz wrote: post #621

Earlier quoted context omitted.

That’s just confusing cause and effect. If your seats are safe, you have no reason to agree to forming an independent commission. The same is true in both heavily blue and heavily red states. Are districts more competitive in states where Democrats draw maps? I don’t think so.

This totally ignores values and motivations, and I would argue that only one group in your comment values winning at any cost.

I don’t even know which group you mean, but “my group has good values and motivations, but the enemy group just values winning at any cost” is exactly what a total partisan who values winning at any cost would say.

Re: The time bomb in the tax code that's fueling mass tech layoffs

#649

Post by jere »

testrun wrote: post #634
jere wrote: post #619

Earlier quoted context omitted.

I can see why it would affect startups not making a profit but why would it dramatically affect FAANG (e.g. some of the most profitable companies in the world that have been running for decades)? The article contributes all these large layoffs in FAANG, in part, to this tax rule.

Because they are profitable. So the cost is deductible over 5 years, instead of one year. A very simple example: Revenue: $ 1 000 All other cost except software: $ 500 Software cost: $ 100 Net profit (if software is allowed as opex): $400 Tax on $400 (@30%): $120 Net profit after tax: $280 However, if it is capex(amortized over 5 years): Revenue: $ 1 000 Other cost (except software): $500 Software cost: $ 100 Net pro…

There's a difference of $24 but I have $1200 in cash reserves. And I make up the difference later. Oh no! Guess I have to lay off 10% of my employees now.

Re: The time bomb in the tax code that's fueling mass tech layoffs

#650

Post by [deleted] »

glompers wrote: post #429
rayiner wrote: post #408

Earlier quoted context omitted.

[flagged]

This civic control correlation can simply have more to do with the most-white-supremacist Democrats switching to the GOP en masse and also simultaneously leaving multiethnic cities and school districts en masse after the 1960s. That self-selection left Republicans not a competitive amount of credibility or voter pool behind to work with. Your implication that policy dysfunction has ensued on that account rather than…

[deleted]
Post reply on HN