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How Apple sidestepped a 2013 crackdown on its Irish tax practices

bbc.co.uk

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Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#301

Post by delinka »

sliverstorm wrote: post #293
delinka wrote: post #208

Earlier quoted context omitted.

If you mean "back into the US," then indeed there is the potential to continue sitting on that money and maybe it won't enter the US economy. If, however, you do mean to ask "...back into the US economy," then ... jobs. How they choose to place the money into the economy is definitely a question, but ultimately any use should indeed support employment of the labor force. Loan the money out? The borrower puts someone…

Unless it's paid out in dividends and executive compensation and stock buybacks. Which is what happened with the last tax holiday under Bush. https://theintercept.com/2017/04/27/bush-already-tried-trump...

I would argue that's not "...back to the US economy."

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#303

Post by malandrew »

ubernostrum wrote: post #291
malandrew wrote: post #261

Earlier quoted context omitted.

At some point you tax people too much and they leave your country for one with better taxes. Never forget that the top 20% of citizens are responsible for like 87% of all the tax revenue the US and state governments rely on. In fact this already happens at the state level in the US: http://www.howmoneywalks.com/irs-tax-migration/ If the new cut cut cut tax plan passes and Californian's can no longer write off state i…

Never forget that the top 20% of citizens are responsible for like 87% of all the tax revenue the US and state governments rely on. Never forget that you implicitly assumed this is because taxes on that segment are too high, rather than because various aspects of our economy were rigged to give those people a disproportionately high share of the total taxable income. In other words: there are two ways to reduce your…

> "various aspects of our economy were rigged"

This is an entirely handwavy and unsupported assertion, whereas stating the percentage of tax paid by the top 20% is a statement of fact with no implicit assumptions.

The people of a country get the tax system written by the representatives they voted for, and are complicit in any "rigging" of the economy.

What we have is a tax code that is layer upon layer of exceptions that came about when Group A supported a tax on Group B to pay for a benefit for Group A. Sometimes group A is in the top 20% (e.g. taxes used to subsidize an industry) and sometimes group A is in the bottom 20% (e.g. taxes used for food stamps). The former arises from things such as regulatory capture and the latter arises from uninhibited populism.

No politically active bloc of voters is innocent. Everyone from the rich to the poor are special interests and all are equally as guilty of "rigging our economy". Only a flat tax that treats no group as special is fair.

I'm curious what you think of Nozick's Wilt Chamberlain example: http://resources.seattlecentral.edu/faculty/jhubert/wiltcham...

In it, absent any tax code distortions, Wilt Chamberlain would end up with most of the taxable income through entirely voluntary transactions. If thousands of people voluntarily pay Wilt Chamberlain to be entertained and Wilt ends up with most of the income, is that a rigged system? Power law distributions in income are a naturally occurring phenomena. No rigging is required.

If the system is indeed rigged, it's rigged in favor of the 45% of Americans that don't pay any federal income tax. They get all of the benefits at none of the cost.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#304

Post by herodotus »

Apple employees earn a lot of money and pay taxes in the jurisdiction in which they live. Companies use their profits either to give dividends to their shareholders (and these are taxed), or to invest in new products or business activities. I think it is counter-productive for governments to go after company taxes.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#305

Post by Frondo »

__blockcipher__ wrote: post #285
Frondo wrote: post #195

Earlier quoted context omitted.

No one is saying the US would make it illegal to operate an international company. They're looking for ways to close some of these loopholes that are keeping a ton of tax money out of the coffers belonging to We the People. Please don't conflate "closing tax loopholes" with "making it illegal to operate internationally".

Please define the specific tax loophole. The "loophole" as far as I can tell is that a company can choose not to repatriate their earnings, which is completely legal.

You were saying "make it de facto illegal to operate a multinational" and that is not on the table and has never been anywhere close to it.

Are you walking that back, and want to talk about loopholes now?

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#306

Post by ikeboy »

crdoconnor wrote: post #249
osteele wrote: post #241

Earlier quoted context omitted.

It's a balancing act, not (just) an arms race. As a government, raise corporate taxes too high, and corporations leave and/or overseas corporations outcompete them and/or new corporations form overseas instead of domestically. Raise tariffs too high, and domestic consumer choice and quality decrease, and consumer purchasing power decreases. These aren't consequences that dissolving your domestic corporations or jaili…

>As a government, raise corporate taxes too high, and corporations leave Only when there's almost no cost to leaving, which in itself is a tax loophole. If you declare that residency is about where you do the most business and has nothing to do with which letterbox has the word "headquarters" on it then their reaction would be limited to tantrums in Wall Street Journal op eds. >or overseas corporations outcompete the…

>That's not how corporation tax works. It's paid on profits and does not affect the competitiveness of the firm.

Corporations often need to raise money from investors, who will rationally only fund corporations that are expected to generate enough profit to produce a good enough return for the risk and so on. If profit is lower in some countries, that reduces the amount of money going to investment in that country as the potential reward has gone down. Therefore such companies are less competitive in fundraising.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#307

Post by nautilus12 »

sliverstorm wrote: post #204
koenigdavidmj wrote: post #88

Earlier quoted context omitted.

Yes, I prefer a law where I can take a possible action and judge by the text whether that action is legal or not, rather than always trying to avoid pissing off a fickle public, like trying to avoid waking a husband who drinks too much so you don't get a black eye.

Except tax law is not always capable of being totally black and white. Have you ever had to work through small business or rental deductions on your taxes? Grey areas, grey areas everywhere, at least if you want to take all the deductions & credits you are entitled to. Nobody including the IRS can give you a black and white answer. (Repairs vs improvements, which are deducted differently, is a good toy example) Part…

This is exactly my point, if the company can create a complex web of interactions to the point that it creates a grey area at what point to we as a society throw our hands up, call a spade a spade and instead pursue a determination that they are clearing trying to avoid paying taxes, regardless of what the specific technical interpretation of the scenario they have set up.

For example, what if they said that the taxable location of the entity was a function of the output of a quantum state? This is a grey area, but is even this enough for us to say that they are clearly just trying to pull the wool over the governments eye?

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#308

Post by sliverstorm »

delinka wrote: post #301
sliverstorm wrote: post #293

Earlier quoted context omitted.

Unless it's paid out in dividends and executive compensation and stock buybacks. Which is what happened with the last tax holiday under Bush. https://theintercept.com/2017/04/27/bush-already-tried-trump...

I would argue that's not "...back to the US economy."

Yes, exactly the point. Sorry.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#309

Post by [deleted] »

sliverstorm wrote: post #204
koenigdavidmj wrote: post #88

Earlier quoted context omitted.

Yes, I prefer a law where I can take a possible action and judge by the text whether that action is legal or not, rather than always trying to avoid pissing off a fickle public, like trying to avoid waking a husband who drinks too much so you don't get a black eye.

Except tax law is not always capable of being totally black and white. Have you ever had to work through small business or rental deductions on your taxes? Grey areas, grey areas everywhere, at least if you want to take all the deductions & credits you are entitled to. Nobody including the IRS can give you a black and white answer. (Repairs vs improvements, which are deducted differently, is a good toy example) Part…

[deleted]

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#310

Post by nautilus12 »

idoh wrote: post #280
nautilus12 wrote: post #268

Earlier quoted context omitted.

Then really I guess we need to work harder to change the letter of the law. I was under the impression when I started the conversation that the tax havens were more of a loophole or ambiguity in the law and that you could prevent this behavior by showing intent to dodge taxes but apparently it is a long standing explicit component of the law. Id be happy to read up more on the existing laws if you would be willing to…

I do not have any links, the best I can say is that these pieces usually reward close reading and diagramming of the facts. My understanding (as a person who has taken a couple tax law classes) is that it isn't an explicit law but a combination of things, all of which are reasonable, which yields what could be said to be a surprising result: - companies pay taxes on profits - profits = revenue - expenses - It is OK t…

This is not an explicit letter of the law. If they are creating a web of complex interactions to avoid paying tax at what point do we throw up our hands and call a spade a spade and say that its clear that they are just avoiding paying a tax.
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