Facebook Tax Bill Over Ireland Move Could Cost $5B • Hacker News Board

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#71

Post by ojno » Sat, Jul 30, 2016, 6:21 PM UTC

raverbashing wrote: post #62

mentos wrote: post #45

I often wonder about a tax system that just works on inflation. Why does a govt go out of its way to collect taxes if it's also going to print money? To me it's so that you can tax different entities at different rates. But if we're willing to adopt a flat tax of X% I wonder if it could be collected through inflating everyone's dollar?

This is a very good way of making the poor even more poor

Perhaps if you were to only use the created money for welfare etc?

(Not that I'm optimistic that such a system could come about in practice, or that I'm an economist.)

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#72

Post by koralatov » Sat, Jul 30, 2016, 6:24 PM UTC

rayiner wrote: post #44

People should actually read up on the tax structure Facebook used: http://www.bloomberg.com/news/articles/2016-07-28/facebook-g... . It's not reliant on some crazy lobbied-for loopholes in the tax code. It actually relies on some fairly mundane provisions of various countries' tax laws. Just getting rid of, say, transfer pricing rules wouldn't make tax avoidance harder, it would make it easier. Say you do all your R&…

    > license the U.S.-made IP to that subsidiary for $0.
    > Boom the U.S. company now has no profits to show and
    > all profits are in the low-tax jurisdiction

That seems simple, but the U.S. government are wise to that kind of thing. At a previous job, the U.S. parent company used to supply our spare parts, which we then sold to end-users in Europe. We operated under very strict rules, derived somehow from Sarbanes-Oxley, about how much the U.S. parent had to charge us for these parts to ensure that they weren't simply running up a loss for tax reasons. IP worked the same way.

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#73

Post by jsmith0295 » Sat, Jul 30, 2016, 6:24 PM UTC

thisisbad wrote: post #15

Corporate income taxes should be eliminated. Instead of focusing on building a company and good products, companies have to dedicate resources to figure out how to escape the taxation. Taxation should be done when profit is distributed to shareholders (similar to Estonia). There is also unfair double taxation - paying taxes after company pays them.

You'd have to come up with a reasonable way to tax the gains of foreign investors, but otherwise I think it makes sense to just get rid of both capital gains and corporate income taxes and just roll everything into the personal income tax system.

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#74

Post by jsmith0295 » Sat, Jul 30, 2016, 6:27 PM UTC

spyspy wrote: post #18

thisisbad wrote: post #15

Corporate income taxes should be eliminated. Instead of focusing on building a company and good products, companies have to dedicate resources to figure out how to escape the taxation. Taxation should be done when profit is distributed to shareholders (similar to Estonia). There is also unfair double taxation - paying taxes after company pays them.

Then we'd have companies like Amazon that refuse to pay a dividend indefinitely.

Even if that were the case you could tax gains from selling their stock as income. If they were hoarding cash the value of that cash would increase their stock price.

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#75

Post by nxzero » Sat, Jul 30, 2016, 6:27 PM UTC

Just curious, but what would happen in a country where no one paid any taxes?

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#76

Post by koralatov » Sat, Jul 30, 2016, 6:28 PM UTC

nxzero wrote: post #75

Just curious, but what would happen in a country where no one paid any taxes?

Greece would be a pretty good example. Some people were paying taxes, of course, but there was widespread corruption and underpayment of taxes.

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#77

Post by jonhankok » Sat, Jul 30, 2016, 6:29 PM UTC

jsprogrammer wrote: post #69

sp332 wrote: post #42

Earlier quoted context omitted.

This is 100% about taxes. The only reason the IRS cares about valuing assets is for the amount of tax they can levy on them. And saving $5B sounds darn efficient to me.

It is stealing, if it was intentionally undervalued to avoid a tax.

Do you consider it stealing if a bakery takes back bread that was stolen from their store?

Taxes are theft by force. Try to skip paying and see how quickly the authorities steal it straight out of your accounts.

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#78

Post by JoshTriplett » Sat, Jul 30, 2016, 6:29 PM UTC

Pxtl wrote: post #26

spyspy wrote: post #18

Earlier quoted context omitted.

Then we'd have companies like Amazon that refuse to pay a dividend indefinitely.

Tax capital gains as income.

Millions of retirees have carefully worked out the point at which they can retire based on capital gains, and increasing taxes on it would break that.

Perhaps tax income like capital gains, if you want them to match.

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#79

Post by jsmith0295 » Sat, Jul 30, 2016, 6:31 PM UTC

karma_vaccum123 wrote: post #49

thisisbad wrote: post #15

Corporate income taxes should be eliminated. Instead of focusing on building a company and good products, companies have to dedicate resources to figure out how to escape the taxation. Taxation should be done when profit is distributed to shareholders (similar to Estonia). There is also unfair double taxation - paying taxes after company pays them.

Then most of the upper and middle class would incorporate, leaving the poor to pay income tax.

Even if you did this you would still need to pay yourself a salary or dividends, either of which would then be taxed as income. So there's some wiggle room to avoid paying tax on business expenses, and I'm sure that would be abused to an extent, but given that the tax system would likely still be progressive there's on reason the poor would be paying a larger share of the tax.

Re: Facebook Tax Bill Over Ireland Move Could Cost $5B

#80

Post by JoshTriplett » Sat, Jul 30, 2016, 6:35 PM UTC

unabst wrote: post #61

thisisbad wrote: post #15

Corporate income taxes should be eliminated. Instead of focusing on building a company and good products, companies have to dedicate resources to figure out how to escape the taxation. Taxation should be done when profit is distributed to shareholders (similar to Estonia). There is also unfair double taxation - paying taxes after company pays them.

Actually this is not as bad as most people assume. Companies should mostly re-invest, so should have no income. They should only have growth. Taxing profit is taxing the reward (a delusion of money produced after all operations), which is what's suppose to justify it. But taxing growth is taxing the company itself (taxing the operations). Taxing shares or dividends would be taxing rewards. Apple has generated a boatl…

> Amazon being able to escape sales tax early was bad.

They didn't "escape" it; states attempted to charge it for inter-state transactions, which they can't legally do in the absence of federal law allowing that. Amazon only became obligated to pay it when they started conducting intra-state commerce, which states are allowed to regulate and tax.