Some voters are sick of companies like Amazon paying no corporate tax • Hacker News Board

Re: Some voters are sick of companies like Amazon paying no corporate tax

#161

Post by icebraining » Tue, Apr 30, 2019, 5:45 PM UTC

notacoward wrote: post #153

icebraining wrote: post #137

Earlier quoted context omitted.

Any new company, including a mom&pop restaurant or whatever, will have startup costs that established companies do not (e.g. buying equipment, training people, etc). How do you propose to distinguish those from these "predatory" losses? Or should those losses not be carried over either?

That's a really good question, and - contrary to HN tradition - I'm not even going to pretend I have a complete answer. Some cases are easy, for example a lot of non-tech startups are funded by loans rather than equity exchanges. Other cases are surely harder, but I think clear lines can and should be drawn. The key IMO is that the company should be paying tax somewhere along the line. Right now VC is a double gift -…

The effects on government revenue seem more complex than that. For example, if a customer of a startup spends $8 instead of $12 thanks to VC subsidization, those $4 remaining in their pocket will be spent somewhere else, and the IRS will get to tax that expense too.

Re: Some voters are sick of companies like Amazon paying no corporate tax

#162

Post by gigatexal » Tue, Apr 30, 2019, 6:07 PM UTC

jyounker wrote: post #103

gigatexal wrote: post #30

This comes up all the time. The issue is not the companies. The issue is the loopholes that their highly paid tax accountants are taking advantage of. Change the law not attack the company for acting in the best interest of its shareholders.

And how did we end up with those loopholes?

Repeat after me: elected officials are our representatives. If you don’t like them either by how they vote or the bribes I mean donations they receive then make your voice known by getting involved, voting, or donating to causes and people you do support.

A flat tax is an idea. It has come up from time to time and failed. There are lobbyists on both sides and both are evil in their own ways.

In the end the elected officials pass laws. Companies pay tax under those laws. The laws have loopholes and those same companies use them.

The. Companies. Are. Not. To. Blame. For. Saving. On. Their. Taxes. Legally. Even if it is a bit unethical while being profitable.

Re: Some voters are sick of companies like Amazon paying no corporate tax

#163

Post by Proven » Tue, Apr 30, 2019, 6:10 PM UTC

Keyword: "some".

Most are happy because products they buy from Amazon are cheaper.

Re: Some voters are sick of companies like Amazon paying no corporate tax

#164

Post by dcosson » Tue, Apr 30, 2019, 7:13 PM UTC

bryanlarsen wrote: post #154

dcosson wrote: post #138

Earlier quoted context omitted.

None of the “well actually” replies you’re getting has yet mentioned that carrying forward personal capital losses is capped at $3000 per year. How could anyone argue that is remotely the same as Amazon avoiding billions in taxes? There are also a lot of other ways companies get much more favorable tax treatment than people — for one thing just very fundamentally, they are taxed on profits but people are taxed on rev…

In theory, that's what the standard deduction is for. If you spend $1MM/month on rent, that's a luxury and should use after-tax dollars. If you spend $500, that's a necessity and should use before-tax dollars. Thus the 12,000 standard deduction: the first $1000/month you spend on rent, food etc is done with before-tax dollars, subsequent dollars use after-tax dollars.

I'm taxed on my actual income though, not something like the whole country's median income. But I can only deduct a crude approximation of the whole country's minimum necessary expenses.

It definitely works against you both ways in high COL areas, where salaries are higher in part bc expenses are higher, but deductions are still fixed.

Re: Some voters are sick of companies like Amazon paying no corporate tax

#165

Post by civilitty » Tue, Apr 30, 2019, 7:41 PM UTC

bryan_w wrote: post #158

civilitty wrote: post #92

Earlier quoted context omitted.

Fair enough. I agree that the word count would much better be spent on discussing the relevant legislation and resulting tax codes. But let me be honest. I wouldn't read that story. I'm not a tax policy wonk, nor am I qualified to opine on the legislative process except to express exasperation at the gridlock. I am however qualified to vote for candidates who are and that first requires awareness of the issues, a top…

> I'm not a tax policy wonk, nor am I qualified to opine Which makes it so easy for the NYT to manipulate you into jealous frenzy. A lot of people see an outrageous headline and too few ask "what's the other side of the story?" The media knows this and can use it to direct your ire at any of their competitors because it's so effective

The other side of it is what my personal and business's accountants do. I don't need to know the intricate details of their work to look at the final bill and realize that maybe I should be paying more for the benefits I enjoy in this country, especially considering my native tax rate - which gets me a hell of a lot less in Russia than the nearly equivalent effective rate does in the US.

Re: Some voters are sick of companies like Amazon paying no corporate tax

#166

Post by caprese » Tue, Apr 30, 2019, 7:55 PM UTC

lugg wrote: post #41

namdnay wrote: post #22

Earlier quoted context omitted.

Not making money is not the same as making losses. You can carry forwards losses you've made on investments.

> Not making money is not the same as making losses. I have rent and bills to pay regardless of whether I'm making money, that is the definition of making a loss.

I love the debate on how evenly distributed the government stuffs its coffers

It pits everyone against each other to make sure someone else gives more money to the same entity

Fascinating

Re: Some voters are sick of companies like Amazon paying no corporate tax

#167

Post by asdff » Tue, Apr 30, 2019, 9:07 PM UTC

cies wrote: post #20

pure-awesome wrote: post #10

Earlier quoted context omitted.

I don't understand: What's the difference in them passing on the sales taxes and passing on the corp. taxes, or indeed any other expense?

Agreed. But where the tax is coming from pushes society in one direction or another. Picture this: all tax for the budget collected from pollution taxes, so: zero sales tax, zero wage tax, zero home owner taxes. What do you think society will optimize in that case? Yet currently we tax on labour and on home ownership, but not on Amazon. Look around an see the result.

This assumes tech giants aren't the giant colluding monopolies that they are, and actually need to be competitive in quality or price to survive. The tax will be payed by consumers, and shareholders aren't going to see a difference in their dividends.

Re: Some voters are sick of companies like Amazon paying no corporate tax

#168

Post by cascom » Tue, Apr 30, 2019, 9:08 PM UTC

will_brown wrote: post #131

cascom wrote: post #121

Earlier quoted context omitted.

Who would then make an even bigger profit, for no tax savings

you do know that this is a well known tax avoidance strategy right? The profits would be later used to offset the losses carried forward by the parent. Are you an accountant/CPA or attorney?

Perhaps you could pencil out this well known tax avoidance strategy (unless you are really talking about time value of money, jurisdictional arbitrage, or some dodgy maneuver that wouldn’t stand up to an audit)

Re: Some voters are sick of companies like Amazon paying no corporate tax

#169

Post by mikekchar » Wed, May 01, 2019, 5:51 AM UTC

setr wrote: post #79

mikekchar wrote: post #73

Earlier quoted context omitted.

Sounds silly, but feel free to become a corporation. Well, it's not quite as easy as I say. When I went remote I had to start my own contracting company. Because I live in Japan and (at the time) corporations were the default company configuration, my contracting company was formed as a corporation. There are lots of advantages: - I can deduct the rent for my work space. In fact, theoretically in Japanese law I can e…

>although I couldn't actually do it... because in order to rent a place I need a company and in order to form a company I need an address... so... well, it didn't quite work out Couldn’t you get the building first, register as a corporation, then subsidize all following months through the corporation?

Unfortunately no. The corporation has to either buy or rent the building and it is not allowed to rent it from the owner of the company (and rent it back again at a loss -- for obvious reasons ;-) ). I could potentially buy a building, sell it to my company and have the company rent back my living space. But my company doesn't have anywhere near enough money to buy a building outright. Also in Japan, new companies are treated as toxic waste by the banks, so no loan is possible (and probably "I'd like to get a loan to buy a building and rent it back to myself at a loss to the corporation" is not a viable business plan as far as the bank is concerned anyway...). I can't even get a corporate credit card! We do all of our transactions in cash, if you can believe it.

What I could do is rent a building with the corporation now and move the corporation. The problem is that you have to reincorporate the company at the new address (which would cost me about $3K). Japan is the land of bureaucracy after all! (Edit: I will likely do this if we decide to move since I'll have to pay that money anyway).

The tax break is really to accommodate companies that build a new factory and then build housing for the factory (or a house next to the factory for the owner). It's not really intended to be used the way I want to use it (to literally live in the work space).

Re: Some voters are sick of companies like Amazon paying no corporate tax

#170

Post by TomMarius » Wed, May 01, 2019, 8:50 AM UTC

lugg wrote: post #47

TomMarius wrote: post #31

Earlier quoted context omitted.

Not turning a profit does not mean or even imply selling at loss at all.

It does actually. Cost of doing business includes all costs. If amazon believes they need to spend money on R&D then that R&D is a cost of doing business, if its not turning a profit with that R&D spending then the business is not sustainable by definition. Amazon was not doing R&D for shits and giggles. Just because the time horizon was long doesn't mean it wasn't any less of a requirement for their success. Amazon…

It doesn't actually. When we're talking about taxes, we have specific timeframes in mind, that is one year. You don't have to turn a profit at year 1 or even year 100 in order to be profitable.