Ireland usually gets a bad rep from this but companies like Intel, Google and MS are the biggest employers in the country. If they were there for purely tax reasons you'd expect them to be shell companies, rather than having multiple fabs in the case of Intel or a few thousand employees in the case of Google.
The Tax Haven That's Saving Google Billions
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Re: The Tax Haven That's Saving Google Billions
#12What this should signal, is that the US should lower its corporate tax rate. Even just making it competitive with other developed nations would probably generate more revenue for the government. And though it would still be higher than the effective rate many companies pay with all these transfer schemes, it would make the hassle less worthwhile. However, what it will actually cause lawmakers to do is increase regula…
The US Corporate Tax is one of the lowest in all the world.
http://www.qbalance.com/Corporate_Tax_Rates_United_States.ht...
But Bermuda still beats out us at ZERO corporate tax rate.
Re: The Tax Haven That's Saving Google Billions
#13Google is "flying a banner of doing no evil, and then they're perpetrating evil under our noses," says Abraham J. Briloff, a professor emeritus of accounting at Baruch College who has examined Google's tax disclosures.
Maybe it is the lawyer in me, but why wouldn't any international business do whatever it could legally do to minimize its taxes? I understand that governments might want to consider these as loopholes and seek to end the right of U.S. taxpayers to avail themselves of these tax-minimization strategies. But, as long as it is legal, why should a company voluntarily seek to expose itself to higher tax rates when it has the choice not to?
I guess when you as a company claim the high ground ("do no evil"), you will have people making their own judgments about what ethical standard ought to govern your conduct and this would explain this professor's remark. By that measure, though, one could argue that companies such as Google should seek to attribute all their revenues to California because that is where their main intellectual property development efforts have occurred and hence pay corporate tax rates at one of the highest rates around simply because they "owe" it to California.
I get this question all the time from web-based startups: why run our revenues through a high-tax state when we have the option of running them through all sorts of lower-tax venues and saving on taxes? The universal answer for smaller companies is "set your company up in a way that let's you pay the least tax you can legally."
Why should Google be held to a different standard on penalty of having its perfectly legal actions castigated as "evil"? Is it the view of some or many in the HN community, for example, that a private enterprise has a form of "social responsibility" to voluntarily subject itself to the tax rates of whatever domicile it happens to have its major operations in (in this case, California) when it legally has the option not to do so? That seems unwise by free enterprise standards and I am genuinely curious to know why refusing to do this would be called "evil."
Re: The Tax Haven That's Saving Google Billions
#14From the article: "Google's practices are very similar to those at countless other global companies operating across a wide range of industries," So, why's the article about Google? Shouldn't the article be about "countless global companies" bilking us for billions? I'm astonished at the lack of outrage on this issue every time it comes up.
Because Google have a public image of behaving ethically. Everyone expects banks and evil multinationals to do this kind of thing.
Is it ethical to avoid paying tax as an individual? Many would say no. But when a company does it, they lay their blame on the shareholders and the market. So the more outrage about this subject, the better. Our governments can either raise taxes or lower taxes. But they shouldn't let individuals and business get away with pretending to pay taxes when they're not.
Re: The Tax Haven That's Saving Google Billions
#15From the article: "Google's practices are very similar to those at countless other global companies operating across a wide range of industries," So, why's the article about Google? Shouldn't the article be about "countless global companies" bilking us for billions? I'm astonished at the lack of outrage on this issue every time it comes up.
Because countless global companies don't claim to be "not evil". Anyone Google hires in the UK (up 'til now anyway) has been educated at the expense of the taxpayer, for example. If someone breaks into their offce, the police will show up to investigate. Why shouldn't they pay their fair share?
My neighbour should not get screwed harder so we are made equal. There's no such thing as a "fair share" of rape.
Besides, if you look at the things the government is doing with the money recently vs. what Google is, there is no contest!
Re: The Tax Haven That's Saving Google Billions
#16Google is "flying a banner of doing no evil, and then they're perpetrating evil under our noses," says Abraham J. Briloff, a professor emeritus of accounting at Baruch College who has examined Google's tax disclosures. Maybe it is the lawyer in me, but why wouldn't any international business do whatever it could legally do to minimize its taxes? I understand that governments might want to consider these as loopholes…
> That seems absurd by free enterprise standards and I am genuinely curious to know why refusing to do this would be called "evil."
When taxes come up, it tends not to be a well-thought, cohesive, pros-and-cons thing. It tends to be an emotional/identity thing. Some people think and almost always argue it'd be a good thing if companies gave more money over to governments.
Me, I think it's very good for the world on every level for Google to pay less taxes. They're hiring the best people, acquiring companies and giving liquidity to founders, run amazing free services (search, Gmail, Google Earth, Google Maps, Google Finance, Google News, Google Voice, Google Reader, Feedburner, many many others). Also, they're internally investing in energy and robotics like the auto-driven cars thing, and their high level personnel seem to invest really well too (like in genetics research). Anyone who thinks that England would do a better job with the money than Google hasn't been to England, or hasn't thought this through very much.
Re: The Tax Haven That's Saving Google Billions
#17From the article: "Google's practices are very similar to those at countless other global companies operating across a wide range of industries," So, why's the article about Google? Shouldn't the article be about "countless global companies" bilking us for billions? I'm astonished at the lack of outrage on this issue every time it comes up.
Because Google have a public image of behaving ethically. Everyone expects banks and evil multinationals to do this kind of thing. Is it ethical to avoid paying tax as an individual? Many would say no. But when a company does it, they lay their blame on the shareholders and the market. So the more outrage about this subject, the better. Our governments can either raise taxes or lower taxes. But they shouldn't let ind…
Is it ethical to avoid paying tax as an individual? Many would say no.
Do you mean avoid (by legal means) or evade (by illegal means)? Any government that uses tax incentives to affect citizens' behavior is saying it's ok to avoid taxes. If they promise your taxes will be lower if you do x rather than y, they're counting on your desire to avoid taxes to motivate you to do x.
Re: The Tax Haven That's Saving Google Billions
#18From the article: "Google's practices are very similar to those at countless other global companies operating across a wide range of industries," So, why's the article about Google? Shouldn't the article be about "countless global companies" bilking us for billions? I'm astonished at the lack of outrage on this issue every time it comes up.
Agreed, I think Goldman Sachs has their effective rate down to less than 2%.
I had a hard time digesting this claim, I looked up on Google and found this:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a...
In 2008, GS's effective tax rate was 1%!
Re: The Tax Haven That's Saving Google Billions
#19Of course, this pales in comparison to Ikea, the world's largest non-profit furniture retailer
Re: The Tax Haven That's Saving Google Billions
#20Google is "flying a banner of doing no evil, and then they're perpetrating evil under our noses," says Abraham J. Briloff, a professor emeritus of accounting at Baruch College who has examined Google's tax disclosures. Maybe it is the lawyer in me, but why wouldn't any international business do whatever it could legally do to minimize its taxes? I understand that governments might want to consider these as loopholes…
It's not just Google who is evil. They're just getting called out on it, because they've pledged not to be evil. It's rather expected of other corporations because we expect them to operate with out morals in search of maximum profit.
But any corporation that takes advantages of tax loop holes, legal or not, is doing evil. By doing that they are taking money out of the pockets of every day citizens in every country who's taxes they avoid paying. Because those citizens have to either make up the difference, or cut vital services such as education, infrastructure, health care and the social safety net. And those citizens can very ill afford to make up the difference.
There are exposes like this done once every few years decrying how low the real tax rate is for some large corporation or other or group there in. Really Google ought not have been singled out by this round. All corporations that do this are being evil. But Google's promised not to be evil -- and for the most part has upheld that -- so they are being targeted.
Really, the most moral course of action here would be to pay the taxes and lobby for the closing of the loopholes. And if they feel the tax rate is too high -- the lowering of the tax rate.