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U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

nytimes.com

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Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#141

Post by onlyrealcuzzo »

dnautics wrote: post #132
0xB31B1B wrote: post #48

Pretty hype about this TBH. There is a long history of companies domiciling in say, Monaco, The Cayman Island, Panama etc to avoid taxes and regulations where they mainly operate. My understanding is that the current process in vogue for the mega cap companies is the "double irish dutch sandwich" https://www.investopedia.com/terms/d/double-irish-with-a-dut... No one, including tax lawyers, will tell you with a straig…

This is all just because we are afraid of the T word. A uniform tariff and matching currency export control achieves the same effect, and doesn't impose US hegemony on the rest of the wrold.

So instead of actually fixing the problem - we should just hope that our government arbitrarily applies Tariffs to the right companies in the right amounts?

Certainly that won't ever be abused to screw over one company and benefit another for political purposes, right?

And, seemingly, a tax authority (the IRS) would be better equipped to calculate these amounts anyway.

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#143

Post by rayiner »

stephen_cagle wrote: post #129

I thought I remembered at some point (might have been more than a decade ago) that I heard that most economist thought that corporate income taxes were basically a bad idea? Is this no longer held as a valid belief? Long term, I would almost prefer if we just moved to taxing people's assets. Maybe we can force corporations to basically pay out most of their profits to shareholders to avoid having them get too large?

Most economists think corporate taxes are a bad idea: https://www.npr.org/sections/money/2012/07/19/157047211/six-...

> Tuesday's show presented the common-sense, no-nonsense Planet Money economic plan — backed by economists of all stripes, but probably toxic to any candidate that might endorse it.

> Three: Eliminate the corporate income tax. Completely. If companies reinvest the money into their businesses, that's good. Don't tax companies in an effort to tax rich people.

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#144

Post by AnimalMuppet »

the_optimist wrote: post #124
alexpetralia wrote: post #116

Earlier quoted context omitted.

This is like pretending only binaries matter (rule/not rule) vs. gradations on a continuum.

No pretending. Sometimes binaries do matter.

Sometimes. Now, do you have an argument that in this situation, binaries matter?

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#145

Post by onlyrealcuzzo »

teachingassist wrote: post #114
treespace88 wrote: post #90

Earlier quoted context omitted.

I would imagine many CEOs being on board with this. If your competitors are using these loopholes, you have to as well. It’s the individuals that shield their wealth by using international corporations that stand to lose the most.

From a corporation's point of view, it's fine if your competitors are treated the same as you are (in a competitive market). But, even if so, CEOs/board members are often those high net worth individuals. So there's a potential conflict of interest that isn't resolvable. This explains why corporations will lobby against a minimum tax, even if the institution doesn't ultimately care.

Corporations have a fiduciary obligation to maximize shareholder value.

Raising taxes on your profits is surely not in the interest of your shareholders.

It doesn't matter if it isn't worse for you competitively. It's worse for your profits.

If you could have more competition AND more profits, you would want that.

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#146

Post by disabled »

zionic wrote: post #131
disabled wrote: post #101

Earlier quoted context omitted.

> benefits to people who pay very little tax This is extremely misinformed. Social Security Retirement, Survivors, and Disability Insurance are entitlement programs, and by far account for the vast majority of this budget (along with the Medicare that most of these individuals are entitled to have). You do not have a right to it, and you are obligated to participate in the insurance program by paying taxes. They are…

Social security is effectively a boomer ponzi scheme relying on infinite population growth to sustain itself. It falls apart the first time a generation realizes they can reap more than they sow by having/investing in fewer children, but the bill comes due. A just system would be something like "invest 15% of your income in XYZ approved categories, or pay a penalty tax on up to 15% of your income". This effectively m…

> Social security is effectively a boomer ponzi scheme relying on infinite population growth to sustain itself. It falls apart the first time a generation realizes they can reap more than they sow by having/investing in fewer children, but the bill comes due.

Likewise, not true. I find your comment to be extremely offensive, too.

I have 2 rare immune-mediated neurological diseases affecting my peripheral nervous system plus type 1 diabetes. I worked nearly full-time at university, while going to university full-time, while still making good grades in undergraduate, in electrical engineering. I had to do this just to keep medical insurance so I would not die.

Anyways, I was extremely sick from age 18 on at university. I was misdiagnosed, and my health problems were blamed as "diabetes complications". I found out that I had a very rare neurological disease, that very likely caused my type 1 diabetes, when I was 22.

I was declared disabled by the Social Security Administration at age 21. I am sure I am not the only one, and some people incur costs that cannot be paid for by just "saving up". This especially applies for medical care. In my case, I really had no chance whatsoever to do this.

By the way, I am off of disability now.

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#147

Post by onlyrealcuzzo »

pseudo0 wrote: post #138
onlyrealcuzzo wrote: post #41

Earlier quoted context omitted.

How else do you solve this in the US? Company A sells all of its IP to Ireland. They have the Irish company charge them 100% of the profits for IP. Poof. No US taxable income. What's your magic beans solution for this beside what the IRS plans to do?

Why not just cut the corporate rate to 0 and raise the necessary funds through a VAT? No amount of fancy accounting tricks will eliminate companies' dependence on the US consumer market.

Because the Federal government doesn't have a sales tax?

This system is easier than getting all 3 branches of the government to impose a VAT.

And also, that doesn't solve the problem.

If you're Apple - you have only pay taxes on your sales in the US.

If you're a smaller company, you pay taxes on all your profits, plus a VAT on your sales in the US.

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#148

Post by disabled »

sagarm wrote: post #115
disabled wrote: post #73

Earlier quoted context omitted.

That is correct, and many of my family members are American accountants and/or CPAs. I suspect that this individual is mixing "fraud and abuse" for "things I don't like and/or agree with paying Uncle Sam [the US government taxman] for". But, that is just a part of life for just about everyone who pays taxes. If the above individual wants to see widespread corruption, you may want to check out some European Union coun…

> nepotism is the modus operandi It's pretty clear that a huge chunk of the US doesn't consider nepotism corruption, given the complete lack of repercussions to Trump for hiring his family into the White House.

Agreed. I am sorry that you are getting downvoted.

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#149

Post by markvdb »

codeecan wrote: post #37

If they would just close the loop holes that allow things like having Apple, setup a subsidiary that licenses its own stuff back to itself so it can move profits around the world ... you'd solve this problem. Make a rule, if you own >50% of a company, you can't buy trademarks, patents, whatever from yourself.

It's very hard to avoid artificial self dealing between related entities. The OECD transfer pricing arm's length principle [0] is supposed to somewhat solve that.

The problem regarding transfer pricing is that the US, the Netherlands, Ireland, Luxemburg, plus most of the places generally reputed to be tax havens have holes in their law you can fly an Antonov AN-225 [1] through.

[0] https://www.oecd-ilibrary.org/taxation/oecd-transfer-pricing...

[1] https://en.wikipedia.org/wiki/Antonov_An-225_Mriya

Re: U.S. Backs 15% Global Minimum Tax to Curb Profit Shifting Overseas

#150

Post by teachingassist »

onlyrealcuzzo wrote: post #145
teachingassist wrote: post #114

Earlier quoted context omitted.

From a corporation's point of view, it's fine if your competitors are treated the same as you are (in a competitive market). But, even if so, CEOs/board members are often those high net worth individuals. So there's a potential conflict of interest that isn't resolvable. This explains why corporations will lobby against a minimum tax, even if the institution doesn't ultimately care.

Corporations have a fiduciary obligation to maximize shareholder value. Raising taxes on your profits is surely not in the interest of your shareholders. It doesn't matter if it isn't worse for you competitively. It's worse for your profits. If you could have more competition AND more profits, you would want that.

> Corporations have a fiduciary obligation to maximize shareholder value.

I understand this statement to mean "Corporations have a fiduciary obligation to maximize shareholder value [within the law]".

Do corporations have a fiduciary obligation to change the law, as in your interpretation?

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