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40% of multinational profits are shifted to tax havens each year

missingprofits.world

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Re: 40% of multinational profits are shifted to tax havens each year

#21

Post by mcv »

exabrial wrote: post #6
systemtest wrote: post #3

I am fairly certain 40% of all citizens would shift their income to a tax haven if possible.

That's exactly how I feel about it. I don't think "paying" taxes are something that is honorable. The money is removed from you forcefully.

I think paying taxes to the society you're profiting from is entirely reasonable. The problem is that corporations are free to profit in one country but declare those profits in another country. Corporations can do that but people can't.

(What's even worse, US citizens (US "persons" even, you don't have to be a citizen for this) that live and work abroad and have nothing to do with the US, still have to pay their taxes there. And also in the country where they actually work and live. People get treated the exact opposite of corporations in this way. Though the US is the only country in the world that does this. Perhaps they're the only one with the power to enforce this world wide; any bank that wants to do business with the US has to report on these "US persons" and play by US rules.)

Re: 40% of multinational profits are shifted to tax havens each year

#22

Post by gpresot »

mcv wrote: post #11

Corporations being able to book their profits wherever they find it most convenient to book them, is utterly unreasonable. They make their profits in specific markets, and should be paying their taxes there. Profits made from selling in the US should be paid in the US, profits made from selling in Germany should be paid there. The problem is, profits are the end result of a lot of complex corporate operations across…

>So how about treating profits that way? In every market, you count the revenue made from selling in that market, and subtract the costs made by buying, hiring, etc in that market. The difference is the profit you made in that market, and you've got to pay your corporate tax over that amount to the tax authority in that market.

>That way you can't book your profits in a country where you didn't make any revenue. And if somehow you do make your revenue in a country where you didn't make incur costs, you pay tax over the entire amount. If you don't make revenue, then tough. You could have made some tax-free revenue there.

This is already what is happening. Company A sells something for 100 in Country X. But the product is manufactured in Country Y, and the brand is "rented" by a company that owns it and set up in country Z. These costs that get passed to Country Y and Z are the local revenues in these countries. It happens that Y and Z are countries with lower tax rates, so the comapny tries to maximise the Transfer Price it pays to its legal entities located there.

Re: 40% of multinational profits are shifted to tax havens each year

#23

Post by throwawaysea »

FYI this isn’t new info; this research was published approximately 1.5 years ago.

Personally I’m not certain that a government would put this extra money to good use. Gabriel Zucman (advisor behind Warren’s wealth tax, whose doctoral advisor was Thomas Piketty) is one of the people behind this website, and seemingly has an ideological problem with personal and corporate wealth accumulation. But I haven’t seen cogent arguments (from him or Piketty or Emmanuel Saez) as to why accumulation of having a tax strategy is wrong. Everyone would avoid taxes if they could, and governments aren’t exactly known for putting capital to efficient use. Furthermore theee corporations have to pay taxes when money is repatriated so this is more of a tax rearrangement strategy. See https://www.investors.com/politics/editorials/overseas-profi...

Re: 40% of multinational profits are shifted to tax havens each year

#24

Post by 9c8675a8 »

arethuza wrote: post #5
ccvannorman wrote: post #2

Remember when the Panama Papers came out and absolutely nothing happened? On the plus side, exploitation of the system by the richest has been going on for millennia, the only difference is that today more people are aware of it.

That's not quite true - a lot of stuff happened see: https://en.wikipedia.org/wiki/Panama_Papers Also, Mossack Fonseca was shut down. Mind you - nothing happened to the basic approach of offshore shell companies - which is the real problem.

Muh problem. As if it was your money to begin with. Do you honestly think this money will end up in your hands either directly or indirectly? You're all nuts.

Re: 40% of multinational profits are shifted to tax havens each year

#25

Post by throwawaysea »

jessaustin wrote: post #15
seibelj wrote: post #4

Corporations already pay myriad income taxes and distributed profits (capital gains and dividends) are taxed, paid by the recipient. Corporate tax is double taxation and is inefficient. The optimal corporate tax rate is zero and I wish people would understand this. 35% corporate tax rate the US had before the tax cut was completely absurd and the only corps that paid it were small ones that didn’t have in house staff…

I think the idea is that taxes aren't only evaded at the level of the firm. Shareholders also evade taxes, but through "double taxation" they might still end up paying something .

I don’t think the designs of tax structures are that clever or principled. I think it’s more like “we want to spend more and so let’s find the most politically expedient revenue source we can get away with”. Over time, the legislation (and spending habits) put in place by all the politicians that come and go results in an inefficient, inscrutable mess that is modern taxation and government spending, along with requisite anomalies like taxing the same dollar several times.

Re: 40% of multinational profits are shifted to tax havens each year

#26

Post by mcv »

9c8675a8 wrote: post #19
SolaceQuantum wrote: post #10

Earlier quoted context omitted.

Honestly, I'm down for paying taxes. It pays for my lifestyle and is propostional to my lifestyle. If I own land, that land is only valuable due to the society that land exists in. It's protected, and safe, due to public services like roads, which law enforcement, fire control folks, postal service, and ambulances drive upon. I've earned my income from a lifetime of education, starting from my public school kindergar…

> It pays for my lifestyle No it doesn't. You're deluded, a hypocrite or a liar.

What's hypocritical about this? I suppose if you honestly believed SolaceQuantum was wrong[0], you might indeed believe they were either deluded or a liar, but even then, what's hypocritical about it?

[0] They're not wrong of course; everything claimed in that comment is entirely (or 'mostly', at least) correct. I'd love to see you try to refute any of it.

Re: 40% of multinational profits are shifted to tax havens each year

#28

Post by Thlom »

throwawaysea wrote: post #23

FYI this isn’t new info; this research was published approximately 1.5 years ago. Personally I’m not certain that a government would put this extra money to good use. Gabriel Zucman (advisor behind Warren’s wealth tax, whose doctoral advisor was Thomas Piketty) is one of the people behind this website, and seemingly has an ideological problem with personal and corporate wealth accumulation. But I haven’t seen cogent…

As far as I understand Piketty does not argue that wealth accumulation is morally wrong. He argues that wealth accumulation has a negative effect on society.

Re: 40% of multinational profits are shifted to tax havens each year

#29

Post by koolba »

mcv wrote: post #21
exabrial wrote: post #6

Earlier quoted context omitted.

That's exactly how I feel about it. I don't think "paying" taxes are something that is honorable. The money is removed from you forcefully.

I think paying taxes to the society you're profiting from is entirely reasonable. The problem is that corporations are free to profit in one country but declare those profits in another country. Corporations can do that but people can't. (What's even worse, US citizens (US "persons" even, you don't have to be a citizen for this) that live and work abroad and have nothing to do with the US, still have to pay their tax…

> What's even worse, US citizens (US "persons" even, you don't have to be a citizen for this) that live and work abroad and have nothing to do with the US, still have to pay their taxes there.

That’s the price you pay to have the most powerful country in the world as a destination to which you can always retreat.

Re: 40% of multinational profits are shifted to tax havens each year

#30

Post by cascom »

SolaceQuantum wrote: post #10
exabrial wrote: post #6

Earlier quoted context omitted.

That's exactly how I feel about it. I don't think "paying" taxes are something that is honorable. The money is removed from you forcefully.

Honestly, I'm down for paying taxes. It pays for my lifestyle and is propostional to my lifestyle. If I own land, that land is only valuable due to the society that land exists in. It's protected, and safe, due to public services like roads, which law enforcement, fire control folks, postal service, and ambulances drive upon. I've earned my income from a lifetime of education, starting from my public school kindergar…

I suspect few people here think they should pay no tax, however I’m quite sure that most would disagree about what the “right” amount would/should be. Furthermore, this is exacerbated by the quality and quantity of public goods different people use (e.g. there are plenty of people that have never set foot in any type of public school/university)
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