Paradise Papers: Dear Tim Cook • Hacker News Board

Re: Paradise Papers: Dear Tim Cook

#741

Post by throw2016 » Thu, Nov 09, 2017, 1:06 AM UTC

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?

Its not an accident that these loop holes exist. And companies like Deloitte and Pricewaterhouse are happy to consult companies and help them save taxes.

Some of these accounting and financial advisory companies are also large campaign contributers with revolving doors with relevant government departments.

There is an inevitability about it, but many are either on koolaid or demonstrate an intentional naivete.

Re: Paradise Papers: Dear Tim Cook

#742

Post by ringaroundthetx » Thu, Nov 09, 2017, 1:17 AM UTC

ChuckMcM wrote: post #736

ringaroundthetx wrote: post #568

Earlier quoted context omitted.

Well as you can see with the poor OPSEC, the offshore incorporation industry is ripe for disruption. Although I've never had any of my entities "leaked", as if they were secret anyway, these leaks are mana from heaven as these are client lists you can POACH and offer better services for cheaper. I've been using OTONOMOS for some time for incorporation and offshore entity management, which stores some client signature…

I think tax avoidance as a service could be a thing. If I could get someone to hire me as an 'individual supplier of engineering services' and they could pay my holding company in the Cayman islands directly. Places like Apple already hire janitorial services so that they don't have to hire janitors directly, they could hire my engineering service. Pay the agreed upon rate and leave tax/medical/retirement to my servi…

So I foreshadowed this already but Americans can't have passive holding companies and expect to avoid US tax. (Holding company implies passive property ownership.)

1960s era Congress already created CFC, PFIC, FBSCI, FBHCI laws which ensures that compliant Americans can't have passive offshore companies to defer taxes indefinitely. You looked like you were on to an original idea but your grandparents already thought of it. What you suggested still requires your non-compliance and the opposite of perfectly legal.

Those laws put your offshore earnings from US connected entities right back on your US personal income tax.

Most of these regulations are undermined by not having a passive holding company but an offshore company with additional business operations.

Re: Paradise Papers: Dear Tim Cook

#743

Post by chx » Thu, Nov 09, 2017, 1:44 AM UTC

dalore wrote: post #588

chx wrote: post #565

Earlier quoted context omitted.

> 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. I am not even annoyed by that. I am an immigrant into Canada. We sort of made a deal: you let me into a place where I can live a safe and free life and I will pay my taxes leading to that. I stand by that deal. I had a company in Gibraltar (which, by the way, was completely lega…

A tax on earnings? Do you mean revenue? I think that's a bit insane and lot's of business wouldn't be able to survive. If I buy something for $100 and sell it for $110 I now have to pay tax on the $110 amount rather then the $10 amount, increasing my tax tremendously. For businesses with lot's of inventory that would be murder.

Wherever this is implemented it's an option. It's never mandatory. There are tons of knowledge based operations where expenses are way too few. Obviously if you are a traditional buy stuff, add value, sell stuff business then you want to bother with bookkeeping sure.

Re: Paradise Papers: Dear Tim Cook

#744

Post by loceng » Thu, Nov 09, 2017, 2:15 AM UTC

nickpp wrote: post #292

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.

How exactly are they inflicting all that harm, hardship and suffering? In my eyes, they are creating tremendous value every day while following every single law nations impose on them. They would risk everything otherwise. You're throwing demagogic, populist accusations without a single shred of support. Is emotional discourse an acceptable replacement for the rational one?

And I suppose I could say you present no evidence or support of my being demagogic? These companies are breaking the spirit of the law. You know how it's common in agreements/contracts that it states both parties are acting in good faith? That's the same idea..

Re: Paradise Papers: Dear Tim Cook

#745

Post by loceng » Thu, Nov 09, 2017, 2:23 AM UTC

josejuanisaac wrote: post #390

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 are doing it too” is legally a valid excuse. The way legal disputes get settled usually is based on the outcome of precedent legal cases and how they relate to the current case. Your moral outrage (and the outrage caused by paradise papers type reports) is just a failure to see the world for what it is. An ant can complain all day about the size of the mammoth, complain that it’s unfair that it’s got a fur coat…

There's no failure on my part to see how the world is. Legally speaking, law is to be interpreted. In these cases of tax evasion, it's fairly obvious they're breaking the spirit of the law. Your entitlement argument is bizarre to me. They are entitled to save as much as they can, after they've paid their dues back to the society who helped support a more stable environment. In Canada for example, many health care costs are covered for every citizen - so businesses don't have to necessarily pay as high of wages to workers - they of course are partially paying for these health costs through taxes. Same with public transit and road systems their employees will use. Apple paying high salaries is an apples and oranges argument - likewise, they couldn't "afford" as high of salaries if they were paying proper taxes; of course they still could afford such high salaries because of their profits. Imagine how good Apple would look right now if they were one of the few massive companies who didn't avoid paying fair taxes? Especially since they can afford it.

Re: Paradise Papers: Dear Tim Cook

#746

Post by vfulco » Thu, Nov 09, 2017, 2:32 AM UTC

There are a sea of lawyers, accountants, investment bankers et al., using the best intelligence the marketplace has to offer, to move money around the world for corporations in a game of (don't) whack-a-mole. Until these guys get a kick in the teeth and some semblance of honor, the game will go on because it pays top tier compensation. Scoundrels.

Re: Paradise Papers: Dear Tim Cook

#747

Post by urza » Thu, Nov 09, 2017, 2:33 AM UTC

ThrwyAct wrote: post #446

urza wrote: post #360

Earlier quoted context omitted.

Look at the innovation pace of products delivered by free market vs those by government. If government made computers, they would still be big as room and only the rich could afford them. Meanwhile free market delivered computers into your pocket with power and capabilities that just 10 years ago no one would believe. Our education system preparing our kids for future is still basically the same as our grand-grand-pa…

If not "crippled by government", schools and hospitals would be Darwinian shitshows that absolutely guaranteed rising health and income inequality. I agree that things like fast computers are nice side effects of allowing capitalism to go to work in some arenas, but, in others, you definitely need government to reduce the pernicious effect of unadulterated profit motive. It's appealing to think to yourself "hey, I ma…

private schools and hospitals would be Darwinian shitshows that absolutely guaranteed rising health and income inequality

Reality disagrees. Pretty much everywhere where private schools and hospitals are allowed at least to some degree, they provide better value and results for everyone, including the very poor: https://www.economist.com/news/briefing/21660063-where-gover...

Hospitals the same. In my country (eastern Europe) the difference between state hospital and private hospital is like difference between two centuries. The beauty of free market is that it lowers the costs for everyone. So the poor will always have "less luxury" at given time period, but in absolute terms will be much better of with free market then with state services. In eastern post-communist Europe, this is evident on every step.

Re: Paradise Papers: Dear Tim Cook

#748

Post by libertyEQ » Thu, Nov 09, 2017, 3:22 AM UTC

musage wrote: post #734

libertyEQ wrote: post #714

Earlier quoted context omitted.

Well, this was an unpopular comment. How do we properly incentivize progress and innovation? This is the safest, most prosperous time to be alive in the history of humanity, despite what you have been told.

> How do we properly incentivize progress and innovation? There is no progress or innovation without qualifiers. > safest, most prosperous And most depressed, most suicidal, most alienated, most amok running, most hysterical, most sophistry laden, most marketing raped, most mass produced, most polluted times ever. Millionaires today are poorer than paupers, artists today are more cloned and out of touch with themselv…

>If it's the safest and best in your opinion,

While being a poor translation of what I wrote, based on facts you are completely incorrect.

Just tell me what you are for.

I am using statistics. Do I need to cite sources for you to believe that this is the safest and most prosperous time in the history of humanity?

Re: Paradise Papers: Dear Tim Cook

#749

Post by curiousgeorgio » Thu, Nov 09, 2017, 3:52 AM UTC

tsbertalan wrote: post #567

curiousgeorgio wrote: post #467

Earlier quoted context omitted.

> They are screwed. That's true if you think the solution has to come from more legislation and/or more taxation. Those approaches will simply encourage companies to move more of their operations to other more favorable jurisdictions. If there's a way to save money, and companies have a responsibility to shareholders to be as profitable as (legally) possible, they'll do what they need to in order to save the money. W…

Even better than bringing all corporate taxes down to the lowest rate; force tax havens to bring the lowest rate up to something reasonable. A global economy demands global rule of law. Then, yes, market forces can be used to direct corporate citizenship (and therefore employment+tax revenue) to where it is needed (assuming sufficiently far-sighted governance to realize the global equivalent of Ohio needing more fede…

> force tax havens to bring the lowest rate up to something reasonable

Easier said than done. Not going to happen any time soon (or ever, in my opinion).

> Your race to the bottom would only ensure that governments eventually cede all power to multinational corporations.

If corporate taxes are the only thing standing between where we are now and the downfall of governments or the rise of global feudalism, we're already screwed. The corporate tax rate could be 0, and it really wouldn't make that big of a difference in terms of total tax revenue or government power (individual taxes still make up the vast majority of tax revenue).

Re: Paradise Papers: Dear Tim Cook

#750

Post by snappyTertle » Thu, Nov 09, 2017, 4:26 AM UTC

dx034 wrote: post #179

snappyTertle wrote: post #84

Earlier quoted context omitted.

The problem is that we have a government body that can be bought and influenced by the private sector. If government powers were limited in scope, there would be no incentives for lobbying. It's perverted that companies reach a point where it's more profitable to lobby or find ways around laws rather than continuing to spend on production or other business costs.

No, the problem is that the price of something is hard to estimate with tech. Apple, like everyone else, make use of transfer pricing tricks. They don't book profit in one country because the subsidiary there had to pay license fee to use the apple brand. The prices for that are obviously carefully chosen to minimise tax. But for a tax authority to dispute that and come up with a better value of the right to use the…

It's only a problem when the tax man wants to claim a piece of the income...