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Google Boss: We Follow The Law On Tax

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Re: Google Boss: We Follow The Law On Tax

#21

Post by svenkatesh »

pvnick wrote: post #19
svenkatesh wrote: post #16

Earlier quoted context omitted.

I agree with you about simplifying the tax code, but do not agree about reducing the tax-liability. Since these corporations benefit from society just like private individuals do, they should contribute to society (in the form of taxes) in kind.

Why not reduce the tax liability as well for people like you and me then? It would be one thing if governments could be trusted to spend the money wisely, but so far as I've seen (other than obvious exceptions such as emergency services and libraries) that's rarely the case.

I don't disagree with you.

I'm in favor of the tax-code placing an equal burden on everyone. I am against only corporations getting a free-pass though.

Re: Google Boss: We Follow The Law On Tax

#22

Post by pvnick »

svenkatesh wrote: post #17
Shivetya wrote: post #13

Lets see, politicians have created a system so complex they themselves cannot understand it. Then they act upset that someone else has to that others advantage and attempt to vilify them instead of acknowledging that the system is too complex. Sounds about right. You would think that they would instead focus on making a system even they could understand.

Actually, if you look at the video from the Senate hearing, some of the senators are clearly fawning over, and pandering to, Tim Cook. It's disgusting.

What's your point? I thought that senate hearing was disgusting because they were hammering away at Apple for obeying the law. Apple is an incredible success story and they should be lauded as an example of free markets, not vilified for trying to avoid giving extra money to the incompetent fools in congress.

Which would you prefer - successful companies that lawfully avoid paying too much in taxes while supporting western economies, advancing technology, and providing countless jobs? Or a top-heavy, zero-liabilty, exploitive government that, even as it grows unsustainably larger, still demands more and more, always chasing that unreachable pie-in-the-sky ideal of the "fair share."

Re: Google Boss: We Follow The Law On Tax

#23

Post by skore »

Nursie wrote: post #10
dotcoma wrote: post #2

Then it must be the law which is crooked.

The law, as is always the way, is several steps behind social progress and business practices. I'm not sure this can ever be otherwise.

That may be true, I could conceive that if it were otherwise, there would be quite a high potential that you end up with something draconian.

However, I don't think that's the issue here. The issue is that there are corporations making massive investments to actively prevent the law from catch up.

Re: Google Boss: We Follow The Law On Tax

#24

Post by pvnick »

skore wrote: post #20
pvnick wrote: post #7

If my accountant paid a penny more taxes than I owed I would fire them. That politicians are attacking successful companies for trying to pay as little in taxes as possible is offensive and embarrassing. If you're unhappy with the law then change it. Otherwise shut the hell up and stop wasting the tax money you're complaining about.

Now now, be fair. There IS a difference between "paying only the taxes that I am required to pay" and setting up a Double Irish with a Dutch Sandwich. One is investing resources to minimize failure ("I want to make sure we don't pay more than we need to pay"), which I completely agree with - if your accountant fails to do that, it's not a good accountant. But the other is a proactive investment of even more money to…

"My good friend and CFO, Larry, why didn't you set up that offshore account that would legally save us millions of dollars in taxes per quarter like we talked about? That way we could hire more workers so they could feed their families and receive adequate health coverage."

"Oh that wouldn't be fair to the people that couldn't do that."

"You're fired."

Re: Google Boss: We Follow The Law On Tax

#25

Post by figbucket »

mcintyre1994 wrote: post #11

Google is clearly in the right here, unless somebody can actually point out a law they're breaking. Simplifying a lot, Google have 2 responsibilities here: Pay at least the amount of tax they owe, maximise stuff shareholders care about. It doesn't take much to work out the optimal solution to them two problems is to pay exactly the minimum amount of tax possible.

They maybe right but it isn't equal, it's giving them a competitive advantage.

I agree with paying the minimum amount of tax but what does that actually mean? Eric Schmidt said he believes taxes should be at the base of economic activity (ie Ireland) but this is bullshit because it puts all the power in the hands of the corporations and incentivies countries to lower taxes to encourage corporations to move there.

Taxes should be based on where products are consumed so that each country taxes the exact percentage of profits generated from sales in that country. If in the UK Google sales amounted to £1b profit then £230m should be corporation taxes.

Re: Google Boss: We Follow The Law On Tax

#26

Post by dpatru »

svenkatesh wrote: post #16
pvnick wrote: post #14

Earlier quoted context omitted.

Seriously, what's up with politicians recently, both in Europe and here in the States, hammering at successful companies for trying to minimize their tax liability? I specifically avoided saying "leftist" politicians because even the right is guilty (I'm looking particularly at that sniveling fool John McCain). Expect the law to change, creating an even more complicated tax structure and destroying even more economic…

I agree with you about simplifying the tax code, but do not agree about reducing the tax-liability. Since these corporations benefit from society just like private individuals do, they should contribute to society (in the form of taxes) in kind.

Government is a parasite on society. Corporations and other private enterprises are what create good societies through mutually advantageous exchanges. In contrast, governments extract wealth by force or the printing of money (fraud) and use it to pay for things that no private person or corporation would pay for (war, prisons, bureaucracy, fat pensions, welfare for people who could work but don't want to, etc.)

Re: Google Boss: We Follow The Law On Tax

#28

Post by rayiner »

I see a lot of talk about "tax loopholes" but not any specifics about exactly what those loopholes are. It's easy to blame the law (a process which is mostly just a self-reinforcing talking point), but has it occurred to anyone that maybe neither the law nor Google are "crooked?"

You can take the most straightforward law and it still won't withstand a company putting all their IP in a tax haven and then attributing most of their revenues to their tax haven subsidiary. That's not taking advantage of a "loophole" that's taking advantage of the fact that: 1) accounting for revenue is inherently complicated, regardless of the tax laws, especially for service businesses and software services businesses at that; and 2) multi-national corporations must have some way to attribute income to the various countries in which they operate; it wouldn't be fair for every country to individually tax all the company's income separately.

It's instructive to try and figure out a tax law that would allow say the U.K. to reach some portion of Google's income. It's harder than it seems. For example, is it relevant that Google has customers in the U.K.? It shouldn't be--there is no sales tax on search services. If someone in the U.K. for example calls up their accountant in the U.S. for advice, as a general rule the accountant isn't liable for income taxes in the U.K. Is it relevant that Google has servers in the U.K.? Sure. But how relevant? How much of the value of Google's service derives from the servers in the U.K. versus the code and algorithms that were developed in California? I think most people would agree that the servers are just incidental--the real value of Google's services is the algorithms and data. So why should the mere existence of servers in the U.K. entitle the country to tax some substantial amount of Google's income?

Re: Google Boss: We Follow The Law On Tax

#29

Post by mjw »

noonespecial wrote: post #18

I think politicians are just upset that those tax law loopholes that were supposed to be just for their friends are now being exploited by those upstart interweb companies like "the google". Our supporters paid good money for those exclusive exemptions, dammit. This is just making us look bad...

Fair point, although it's rather disingenuous for multinationals (not singling out Google) to say to taxpayers: "don't like our tax avoidance? well just change the rules then!"

Arguably one of the main reason we're not able to change (or at least, enforce) the rules easily is because of regulatory capture of tax agencies around the world, and multinationals are (directly or indirectly) funding this regulatory capture via their investment in complex tax avoidance schemes and the whole industry around them which is in constantly in and out of the "revolving door" between regulators and accountancy firms.

So, likely there's always going to be opportunities out there for aggressive tax avoidance, because of exactly these kind of agency problems. And so a multinational is always going to have a decision to make about exactly how aggressive they choose to be. And they are going to be judged morally by the taxpayer for the decisions they make, whether they like it or not.

If they are judged badly as a result of their choices, they should have the good grace to just admit that they're being selfish because they can get away with it and that's the way things are, and not come up with disingenuous self-serving rationalisations.

Re: Google Boss: We Follow The Law On Tax

#30

Post by genwin »

noonespecial wrote: post #18

I think politicians are just upset that those tax law loopholes that were supposed to be just for their friends are now being exploited by those upstart interweb companies like "the google". Our supporters paid good money for those exclusive exemptions, dammit. This is just making us look bad...

I think the politicians here are just trolling for campaign cash and other favors in kind. When Google greases the right palms the spotlight will shift elsewhere.
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