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Paradise Papers: Dear Tim Cook

projekte.sueddeutsche.de

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Re: Paradise Papers: Dear Tim Cook

#471

Post by HacklesRaised »

tyingq wrote: post #240
loceng wrote: post #188

Earlier quoted context omitted.

These companies evading taxes are responsible for increased hardship and suffering of a society as well, leeching off of the nations they exist in, and being able to outcompete the honest organizations and people in them. The damages are far greater than the tax avoided. "They are doing it too" isn't a valid excuse either.

They aren't, for the most part, doing anything illegal though. They are using the existing laws to their best advantage. The fix for this can't be trying to appeal to their morals. It would have to be something else that just limits the legal choices. Edit: If you disagree, are you saying that shaming them into not doing this solely on some moral compass is the right fix? Does that scale?

It's obviously comedy but the sentiment remains valid, Bill Burr's response to "That's what the law says"

50 years ago the law said I could beat you with a mtop handle, didn't make it right.

Re: Paradise Papers: Dear Tim Cook

#472

Post by akmiller »

nickpp wrote: post #277
zajd wrote: post #251

Earlier quoted context omitted.

You really think the PC is a good example of something "created by a free market" not the result of the govt pouring millions into R&D in the decades previous?

Nobody's denying the contribution of the govt $$$ to the creation of the PC. But I've seen computers build by governments. They were slow, huge, power hungry, expensive behemoths. They sucked. We're a long way from there. And free market brought us all the way here.

Ever heard of NASA?

Re: Paradise Papers: Dear Tim Cook

#473

Post by dijit »

pavlov wrote: post #465
tskaiser wrote: post #455

Earlier quoted context omitted.

IANAL but it is my understanding that if those tax reduction schemes are legal many companies are legally bound by their stock holders to exploit them, or else be found negligent in their duties.

>... if those tax reduction schemes are legal many companies are legally bound by their stock holders to exploit them, or else be found negligent in their duties. That's not the case. There is no way a company's management could be sued for "gross negligence in tax planning". If shareholders are unhappy about this issue, their recourse is the same one that's always available to them: elect a new Board of Directors an…

What if they've done that already though.

What if the reason big companies avoid tax is that the shareholders ensure someone values fiscal results over supporting the country they earned the finance in is in the directors chair.

Re: Paradise Papers: Dear Tim Cook

#475

Post by Swinx43 »

Cakez0r wrote: post #331
mprev wrote: post #302

Earlier quoted context omitted.

Maybe 15 years ago. IR35 has made that approach tax-neutral, at best.

I am new to the contracting game in the UK, but I haven't met a software contractor yet who isn't using this approach. My accountant even recommended it to me when I set up. It is definitely a non-trivial tax saving. Do you pay yourself dividends from your company? Or do you use your profits to increase your director salary so that you pay tax at the same rate as a full-time PAYE employee? Not meaning to call you out…

Accountants keep on recommending this method for some reason but honestly if you do the tax calculations yourself you realise that you are not much better off.

It used to be the case that you were better off but the last 5 years the options for UK limited Company contractors have been reduced to a point where the running costs of the company combined with the taxes bring you to effectively the same amount of tax paid as a permanent employee.

Re: Paradise Papers: Dear Tim Cook

#476

Post by bwindels »

valuearb wrote: post #393
germanier wrote: post #371

Earlier quoted context omitted.

It's perfectly OK if that company actually operates in that country. It is not OK if the only presence they have is a mailbox and the actual act of operation is done somewhere else. A taxation race to the bottom is not what the fundamental principles of the EU are about. At best they are an unwanted side-effect.

No you are missing the point of the EU. No company should be forced to base in a country to sell there. Apple pays huge amounts of taxes in Germany despite not being based there. It just doesn’t pay much “income tax” because it’s not based there.

Which would be fine if there were EU regulations about taxation. Now it's just multinationals playing out different EU members against each other to get the best deal, look at Ireland and Luxembourg. I can imagine a EU fiscal policy would be heavily lobbied against by the companies that use these back doors, as it would shift power back to the politicians/people: either you have access to the EU market and pay taxes according to these rules, or you can't sell your product here.

Re: Paradise Papers: Dear Tim Cook

#477

Post by nickpp »

zajd wrote: post #406
nickpp wrote: post #277

Earlier quoted context omitted.

Nobody's denying the contribution of the govt $$$ to the creation of the PC. But I've seen computers build by governments. They were slow, huge, power hungry, expensive behemoths. They sucked. We're a long way from there. And free market brought us all the way here.

What about the internet? The highway system?

Same thing with the internet. Government spending got us super expensive connections between a handful of universities. Free markets took that and brought it as what we know as the fast, cheap internet to our doors. Although regulations in the telecom/cable/ISP markets are working hard to impede that.

Yes, govt made the highways. Did not really repair them afterwards (at least around here) but it was definitely a good thing.

However, when judging by the bottom line, the number of good products created by govts is incredibly small compared to the amazing breadth and diversity coming from the open markets.

That logically makes me trust the market system overall and to prefer a small, limited government role.

But I am afraid we are moving into quite the opposite direction...

Re: Paradise Papers: Dear Tim Cook

#478

Post by chii »

eru wrote: post #201
cm2187 wrote: post #184

Earlier quoted context omitted.

Flat tax is not just about removing thresholds, but also using the same tax rate across the board. If you tax in the same way income, capital gains or corporate profits, don't give a tax exemption for debt, don't charge a stamp duty on property (or charge the same rate on the purchase of all assets, property or not), etc, then you kill all these tax schemes.

Isn't that usually called a broad based tax or so? I mean I mostly agree with what you are saying, just noting that I'm used to different terminology. Yes, it's a good idea to put eg debt and equity on the same level; don't tax transactions that improve economic efficiency (tax consumption instead for example). Land value tax is still a great idea for these and other reasons. Eg you can jack the lvt really high and b…

LVT sounds good in theory, but a large number of rich people _are_ acting as rent seekers (they own property, and extract value via rents on people who work/produce actual value on it). It would not be politically feasible, unless the gov't is prepared to fight against those powerful land owners.

Re: Paradise Papers: Dear Tim Cook

#479

Post by balabaster »

styx31 wrote: post #80

What annoys me the most is that, as a small company, I can't evade from my country tax system. I pay the taxes. All of them, at full rate. But there are these big companies which can afford to create offshore companies/holding just to evade some tax system, and lower their tax rate. So, what? The tax rate of a country is now "artificial", because it will never be applied to all revenues from all companies, because th…

Would you not make use of a tax break even if you taking it harmed your neighbour? Everyone's response would be "It may suck for you that you can't leverage that loophole, but that person is not breaking the law." It's like the difference between claiming mileage vs. claiming vehicle rental/gas for work trips. You're not breaking the law by claiming one over the other, you're leveraging the framework to greater effect than some others are able.

It doesn't make it morally right, but at the end of the day, everyone leverages the opportunities they have. You can't blame someone for that. They are working within the confines of the framework defined for their circumstance. If that framework had loopholes that could be leveraged by that individual, they would take them.

Re: Paradise Papers: Dear Tim Cook

#480

Post by toyg »

improbable22 wrote: post #448
johannes1234321 wrote: post #404

Earlier quoted context omitted.

This would mean that immaterial things won't have a worth in the book keeping way and can't be billed. In simple terms what happens is that Apple Europe, Inc. has to pay a lot for the license to use the Apple logo and trademark to Apple Paradise, Inc. Thus Apple Europe, Inc. doesn't have profits, while Apple Paradise, Inc. has all the profits. Now the value of the logo and trademark are artificial ... What's needed a…

But this is exactly what happens now. And this is what the letter is upset about. He thinks Apple Europe Gmbh. made profit, and Apple's accountants say Apple Paradise Inc. made the profit, and we all think Apple Cupertino made the profit. And I don't see a good way to settle the argument, thus I suggest not having it. "tax has to be paid where they are created or used" Yes exactly. When they sell a cool computer for…

> Apple's accountants say Apple Paradise Inc. made the profit

... because they offset all local profits to expenses incurred in licensing the brand.

> When they sell a cool computer for E2000, they have used their brand to sell it, and there tax is collected.

But tax is supposed to be collected there and it's not, because Apple accountants immediately declare all profits as debits towards AParadise, so there is $0 profit. That $2000 laptop is now sold at cost, so there is nothing to tax - unless you start taxing expenses, and good luck with that (you'll kill half the economy overnight). All profit goes to AParadise, and the European economy is now at net negative: it pays for the roads that Apple trucks use to deliver their China-made wares, it pays for the social security that frees disposable income for Euro citizens to buy laptops, and in exchange it gets a big fat $0.

The solution is to do away with the "IP licensing" regime altogether, or tax it at absurd rates to discourage these moves. Otherwise you might as well give up and turn into Somalia.

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