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Adding unusable RAM for tax reasons

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Re: Adding unusable RAM for tax reasons

#81

Post by AnimalMuppet »

jrockway wrote: post #50
khuey wrote: post #37

Earlier quoted context omitted.

Why? Borders are full of rules of the form "X can cross for purpose A but not for purpose B" for both people and goods.

How long does the rule apply for? If someone removes seats from their van, is that tax evasion? What if it's temporary? If an individual can do it, why not Ford? The problem I have here is how easy it is to avoid the tax. CBP shouldn't have any jurisdiction over car modifications and repairs; that responsibility falls to different agencies.

The courts tend to take a dim view of "clever hacks" to get around the law, where the intent is clearly to circumvent the law and the action has no other purpose. They don't always rule that way. But if you pull this kind of stunt, you risk the court saying, "Very clever. No."

Re: Adding unusable RAM for tax reasons

#82

Post by beerandt »

fredoralive wrote: post #55
jrockway wrote: post #50

Earlier quoted context omitted.

How long does the rule apply for? If someone removes seats from their van, is that tax evasion? What if it's temporary? If an individual can do it, why not Ford? The problem I have here is how easy it is to avoid the tax. CBP shouldn't have any jurisdiction over car modifications and repairs; that responsibility falls to different agencies.

It seems that the issue was that Ford, the importer, changed the class of vehicle between import and being sold inside the US. Presumably if you aren't the importer you can go wild (IANAL).

No- the norm is for things to be imported, then combined or modified and sold as a new product, without paying the import tax based on the new product.

If import tax on a cpu is x, and motherboard is y, should you have to pay computer import tax z if you build and sell PCs? After all, what imported cpus and motherboards aren't destined to be assembled computers?

Re: Adding unusable RAM for tax reasons

#83

Post by bentcorner »

HeavenFox wrote: post #8
geocrasher wrote: post #5

This reminds me of the Subaru BRAT in the early '80s. There was a 25% tarrif on imported pickups. So Subaru added two plastic jump seats in the back of the BRAT, even making them face backwards. No seat belts as I recall just handles. They weren't even really intended to be used. They were just cheap plastic. But they served the purpose of making the vehicle a four-seater car instead of a pickup, with only a 2.5% tar…

There's also the Ford vs Chicken Tax; basically U.S. import tariff for passenger van is 2.5% and cargo van is 25%, so Ford, which manufactured their Transit van in Turkey, installed seats in factory and stripped the seats once they arrived in the U.S. Now looks like they are in trouble for this scheme. https://jalopnik.com/ford-faces-potential-1-3-billion-fine-f... (And why it's called Chicken Tax is another fascinat…

There's also the infamous Toy Biz, Inc. v. United States case where Marvel Comics argued that their X-Men toys where "nonhuman toys" and not dolls to avoid an import tax.

https://en.wikipedia.org/wiki/Toy_Biz%2C_Inc._v._United_Stat...

The irony is that in the X-Men universe, the X-Men fight for a unification of mutants and humans.

Re: Adding unusable RAM for tax reasons

#84

Post by gamblor956 »

jrockway wrote: post #29
HeavenFox wrote: post #8

Earlier quoted context omitted.

There's also the Ford vs Chicken Tax; basically U.S. import tariff for passenger van is 2.5% and cargo van is 25%, so Ford, which manufactured their Transit van in Turkey, installed seats in factory and stripped the seats once they arrived in the U.S. Now looks like they are in trouble for this scheme. https://jalopnik.com/ford-faces-potential-1-3-billion-fine-f... (And why it's called Chicken Tax is another fascinat…

Wow. I hope the government loses their lawsuit here. Customs & Border Protection should have absolutely no jurisdiction over what an item is used for once it enters the country.

The issue was that the seats were only added for the purposes of evading tax, and the tax evasive purpose was established by Ford systematically removing the seats prior to sale.

Ford would have been fine if they had kept the seats in the car until they were sold and left it up to the customer to remove the seats. (This would not have affected the customer, tax-wise, since the import duty is paid by Ford, and by the time the customer has removed the seats, they have already paid the sales tax on the vehicle.)

Re: Adding unusable RAM for tax reasons

#85

Post by [deleted] »

BizarroLand wrote: post #76
ggrrhh_ta wrote: post #65

Earlier quoted context omitted.

Laws, at least in many European countries, are prefaced with a preamble, introduction, or Vorwort, that explains a bit of the history, the motivation, the underlying principles, the philosophy, the practicality, and the guidelines for interpretation of that law. The words, as written, are not to be taken, in any case literally. Moreover, a literal interpretation contradicting the spirit of the law is unlawful, and th…

A law system like that requires wisdom. America has a lot of smart but almost no wisdom, so it would be chaos and anarchy if we suddenly switched to such a system.

[deleted]

Re: Adding unusable RAM for tax reasons

#86

Post by [deleted] »

etskinner wrote: post #71
colejohnson66 wrote: post #33

Earlier quoted context omitted.

Ford lost in 2019. An appeal to the Supreme Court was denied.[0] My non-lawyer understand of the issue wasn’t so much that they were avoiding a tariff (“tariff engineering”), but that they were removing the seats upon entry. In contrast with the BRAT where the dummy seats were still there when sold. [0]: https://www.autoblog.com/2021/06/03/ford-transit-connect-imp...

I wonder if they could, in theory, sell you the car for 150% of it's final price (so that they seats are there when sold), then buy back the seats immediately for 50% of its price. The invoice would say something like: Car with passenger seats: $15,000; Passenger seat buyback: $5,000; Total after buyback: $10,000. That way everyone gets what they want, and they've technically sold it with the seats still installed.

[deleted]

Re: Adding unusable RAM for tax reasons

#87

Post by jrockway »

fredoralive wrote: post #55
jrockway wrote: post #50

Earlier quoted context omitted.

How long does the rule apply for? If someone removes seats from their van, is that tax evasion? What if it's temporary? If an individual can do it, why not Ford? The problem I have here is how easy it is to avoid the tax. CBP shouldn't have any jurisdiction over car modifications and repairs; that responsibility falls to different agencies.

It seems that the issue was that Ford, the importer, changed the class of vehicle between import and being sold inside the US. Presumably if you aren't the importer you can go wild (IANAL).

Yeah, so they're really just getting punished for not dotting their is and crossing their ts. They could create a subsidiary with the same board of directors as Ford that they sell the cars to, and then the subsidiary does the dirty work of repurposing the cars from passenger vehicles to cargo vehicles. They skipped paying the $100 corporate registration fee, so now they're on the hook for a billion dollar fine that would have been legal if they added another company to the mix? Give me a break.

Re: Adding unusable RAM for tax reasons

#88

Post by Jon_Lowtek »

vilaca wrote: post #72
RC_ITR wrote: post #42

Earlier quoted context omitted.

The Chicken Wars brought the powerful agricultural lobby in France into direct conflict with the powerful agricultural lobby in the United States. Not surprisingly, France, the largest poultry producer in the EEC, was unwilling to embrace a free trade policy whose benefits would be spread among consumers throughout Europe. The benefits of protectionism were concentrated in France and the costs were borne by consumers…

> benefits would be spread among consumers throughout Europe The EU has banned poultry meat from the US on psytosanitary grounds for more than two decades.

Which is a lot younger than the chicken tax from the 1960s

For some context: it is about washing chicken meat with chlorine dioxide to kill bacteria, especially salmonella, at the slaughterhouse. It may seem ridicoulous that europeans prefer salmonella to chlorine on their chickens, but european food health and safety argues that the practice is needed in the USA due to the very unsanitary, and therefor cheaper, chicken meat production, whereas europa requires high standards during production instead of washing the end product in chlorine, and is therefore more costly. Some argue this cost difference is the major driver of the ban, and it is not an actual health and safety issue.

Re: Adding unusable RAM for tax reasons

#89

Post by fredoralive »

beerandt wrote: post #82
fredoralive wrote: post #55

Earlier quoted context omitted.

It seems that the issue was that Ford, the importer, changed the class of vehicle between import and being sold inside the US. Presumably if you aren't the importer you can go wild (IANAL).

No- the norm is for things to be imported, then combined or modified and sold as a new product, without paying the import tax based on the new product. If import tax on a cpu is x, and motherboard is y, should you have to pay computer import tax z if you build and sell PCs? After all, what imported cpus and motherboards aren't destined to be assembled computers?

I was more talking about this particular case, where it seems it was judged that Ford didn't make a new product out of imported parts, but importing a finished vehicle as one thing, and selling it as another after minor modification.

It is a more normal way around these sorts of tariffs to import a vehicle as a kit of parts (CKD / "Complete knocked down"), and perform some level of final assembly in the end country. The sort of rules you talk about apply then, you pay the car parts import rate on the kit, not the (presumably higher) rate for a complete car[1].

[1] Or otherwise avoid whatever other protectionist measures mean you can't just import a fully built car.

Re: Adding unusable RAM for tax reasons

#90

Post by ninly »

geocrasher wrote: post #5

This reminds me of the Subaru BRAT in the early '80s. There was a 25% tarrif on imported pickups. So Subaru added two plastic jump seats in the back of the BRAT, even making them face backwards. No seat belts as I recall just handles. They weren't even really intended to be used. They were just cheap plastic. But they served the purpose of making the vehicle a four-seater car instead of a pickup, with only a 2.5% tar…

Its reputation is eternal: http://achewood.com/index.php?date=12012003
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