"Companies are getting away with murder"

[^_^ 5,021]

To reduce its overseas tax bill, Google uses a complicated legal structure that has saved it $3.1 billion since 2007 and boosted last year's overall earnings by 26 percent ... Its rate since 2007 has been 2.4 percent ... "It's remarkable that Google's effective rate is that low," says Martin A. Sullivan, a tax economist who formerly worked for the U.S. Treasury Dept. "This company operates throughout the world mostly in high-tax countries where the average corporate rate is well over 20 percent." The corporate tax rate in the U.K., Google's second-largest market after the U.S., is 28 percent.

In Bermuda there's no corporate income tax at all. Google's profits travel to the island's white sands via a convoluted route ... In Google's case, it generally works like this: When a company in Europe, the Middle East, or Africa purchases a search ad through Google, it sends the money to Google Ireland. The Irish government taxes corporate profits at 12.5 percent, but Google mostly escapes that tax because its earnings don't stay in the Dublin office, which reported a pretax profit of less than 1 percent of revenues in 2008.

Irish law makes it difficult for Google to send the money directly to Bermuda without incurring a large tax hit, so the payment makes a brief detour through the Netherlands, since Ireland doesn't tax certain payments to companies in other European Union states. Once the money is in the Netherlands, Google can take advantage of generous Dutch tax laws. Its subsidiary there, Google Netherlands Holdings, is just a shell (it has no employees) and passes on about 99.8 percent of what it collects to Bermuda.

All of these arrangements are legal.

...

The setup lowers Google's overseas tax bill, but it also affects U.S. tax revenues as the government struggles to close a projected $1.4 trillion budget gap. Google Ireland licenses its search and advertising technology from Google headquarters in Mountain View, Calif. The licensing agreement allows Google to attribute its overseas profits to its Irish operations instead of the U.S., where most of the technology was developed.

...

Even if the tax avoidance structures are legal, not everyone considers them ethical. Google is "flying a banner of doing no evil, and then they're perpetrating evil under our noses," says Abraham J. Briloff, a professor emeritus of accounting at Baruch College who has examined Google's tax disclosures. "Who is it that paid for the underlying concept on which they built these billions of dollars of revenues? It was paid for by the United States citizenry," Briloff says, referring to the fact that Google's initial technology was based in part on research done at Stanford University and funded by the National Science Foundation.

...

"The system is broken, and I think it needs to be scrapped," says Reuven S. Avi-Yonah, director of the international tax program at the University of Michigan Law School. "Companies are getting away with murder."

http://www.businessweek.com/magazine/content/10_44/b4201043146825.htm

[Heracles 417]

With all the money the have and the revenue they generate, American corporations contribute 9% of United States Federal Budget, yet some want to give them even more tax breaks.

I think if you closed all of these tax loopholes and made these organizations start to pay their share of tax, the budget deficit would be closed. In this modern transnational economy, it's simply to easy for some google to dodge paying tax.

[Obama 2012 1,714]

the irony here is that google is so damn liberal it's not even funny.

Good ole honest libruls!

I do find it amusing that not paying taxes is attributed to being "evil." It truly shows how pathetic of a society we have become in expecting everyone to pay for everyone else... Let's ignore the fact that google still pays more in taxes than 99% of the population will ever pay in their lifetime.

[Heracles 417]

the irony here is that google is so damn liberal it's not even funny.

Good ole honest libruls!

I do find it amusing that not paying taxes is attributed to being "evil." It truly shows how pathetic of a society we have become in expecting everyone to pay for everyone else... Let's ignore the fact that google still pays more in taxes than 99% of the population will ever pay in their lifetime.

Google is clearly dodging the tax system. You cheer this on because as a libertarian, you do not believe in a strong and powerful country. I look at it another way. Google is quite a decent company, so if they are utilizing all of these tax loopholes, what is everyone else doing? What are the Texan corporations doing? Close them and tax those earning over $300K 60% and the budget deficit is closed.

The right speaks out of both sides of their mouth on this issue. I've heard small business mentioned 1000 times over the last few years from the right, yet the right is exactly who has empowered these large corporations and killed small business. The right is why only 6% of Americans are self-employed versus 12% in AUS, up to 30% in Europe. Yet have people believe Europe sucks and they have all the answers.

When I say right, I mean the dirty c--ks-ckers that are greedy which plague the party; not the good honest repubs like Danno, who are simply being conned and fooled.

Edited October 21, 2010 by Heracles

[Obama 2012 1,714]

Google is clearly dodging the tax system. You cheer this in because as a libertarian, you do not believe in a strong and power country. I look at it another way. Google is quite a decent company, so if they are utilizing all of these tax loopholes, what is everyone else doing? What are the Texan corporations doing?

The right speaks out of both sides of their mouth on this issue. I've heard small business mentioned 1000 times over the last few years form the right, yet the right is exactly who has empowered these large corporations and killed small business. The right is why only 6% of Americans are self-employed versus 12% in AUS, up to 30% in Europe. Yet have people believe Europe sucks and they have all the answers.

When I say right, I mean the dirty c--ks-ckers that are greedy which plague the party; not the good honest repubs like Danno, who are simply being conned and fooled.

I cheer nothing. The only thing you'll get from me is the corporate tax rules aren't fair at all to small businesses and not necessarily fair to larger companies either. Especially those companies that do a lot of R&D without relying on the government to do it. I'm not saying people shouldn't pay taxes, but no one should be responsible for make up the messes that government officials do. That should be on the government officials. They should get $0 salary until the mess is cleaned up. That would save several million a year right there... Not nearly enough to make a dent, but it's a start.

You want a happy taxpayer base? Smart spending is the key... It's something that neither Repubics or Dems understand or give a damn about.... That's because their back pockets are being lined... When a US Senator comes into office broke and leaves a multi-millionaire, you know there's a problem with our government.

[one...two...tree 2,762]

Corporations follow the bottom line. They have to. Their survival depends on it. They aren't suppose to act out of altruistic or righteous motives.

Edited October 21, 2010 by El Buscador

[Heracles 417]

I cheer nothing. The only thing you'll get from me is the corporate tax rules aren't fair at all to small businesses and not necessarily fair to larger companies either. Especially those companies that do a lot of R&D without relying on the government to do it. I'm not saying people shouldn't pay taxes, but no one should be responsible for make up the messes that government officials do. That should be on the government officials. They should get $0 salary until the mess is cleaned up. That would save several million a year right there... Not nearly enough to make a dent, but it's a start.

You want a happy taxpayer base? Smart spending is the key... It's something that neither Repubics or Dems understand or give a damn about.... That's because their back pockets are being lined... When a US Senator comes into office broke and leaves a multi-millionaire, you know there's a problem with our government.

American corporations which currently have close to $2 trillion in case reserves, are clearly not paying enough tax; they're paying 9% of federal government's revenue, meaning the rest comes from elsewhere. They don't pay American workers FA, the also dodge the tax front. Tea-party and Libertarians cheer this idiocy on, while the country goes bankrupt. The only winner in this is large American businesses, ultimately their shareholders and executives.

This is why countries like Canada or Australia have strict regulation, rules and basically a code of conduct. Only once a company has paid a decent salary, provided their workers with decent benefits and their share in tax, can they amass wealth. Anyone of the 94% of American who work for someone else, of the 70% of households who earns under $70k who does not support the equivalent here, is honestly both crazy and flat-out stupid.

Edited October 21, 2010 by Heracles

[Heracles 417]

Corporations follow the bottom line. They have to. Their survival depends on it. They aren't suppose to act out of altruistic or righteous motives.

Which is why the government is supposed to set minimum requirements.

However, this belief in how organizations should function is not 100% true. Plenty of international organizations do not operate like the American race to the bottom style, yet still earn a healthy profit. While they might not earn as much as the equivalent American firm, they are still doing well.

End result, as pointed out by Infamous, they do not have as many billionaires. Who cares though, as the rest of the country is doing above average.

Edit: What people also fail to realize is that more and more organizations are earning over 50% of their revenue from abroad. Gezz I wonder why that is, when we are led to believe Americans are killing it and the rest are just poor socialist f-ck-rs.

Edited October 21, 2010 by Heracles

[Obama 2012 1,714]

American corporations which currently have close to $2 trillion in case reserves, are clearly not paying enough tax; they're paying 9% of federal government's revenue, meaning the rest comes from elsewhere. They don't pay American workers FA, the also dodge the tax front. Tea-party and Libertarians cheer this idiocy on, while the country goes bankrupt. The only winner in this is large American businesses, ultimately their shareholders and executives.

This is why countries like Canada or Australia have strict regulation, rules and basically a code of conduct. Only once a company has paid a decent salary, provided their workers with decent benefits and their share in tax, can they amass wealth. Anyone of the 94% of American who work for someone else, of the 70% of households who earns under $70k who does not support the equivalent here, is honestly both crazy and flat-out stupid.

A large corporation is nothing more than a company that has been built up over time because they had/have a product that the American people want. People choose to work for them because they are offering jobs. No one is forced to work for the, so you take what you can get in salary/benefits. An individual or a group of people started that business and worked to get it where it is today. Many seem to forget this. It's already given back to the American people 10 fold because of the obvious product/service it offers... When you tax a business more or demand more benefits from it, you're simply saying, "you earned something, we don't like that, give us your money, it's not fair." When in reality that business never had to provide its useful product/service to begin with... Demanding more is nothing more than pure jealously really....

[Heracles 417]

A large corporation is nothing more than a company that has been built up over time because they had/have a product that the American people want. People choose to work for them because they are offering jobs. No one is forced to work for the, so you take what you can get in salary/benefits. An individual or a group of people started that business and worked to get it where it is today. Many seem to forget this. It's already given back to the American people 10 fold because of the obvious product/service it offers... When you tax a business more or demand more benefits from it, you're simply saying, "you earned something, we don't like that, give us your money, it's not fair." When in reality that business never had to provide its useful product/service to begin with... Demanding more is nothing more than pure jealously really....

Last time I checked Paul, the Constitution focuses on We the People. Corporations, conglomerates, lobbyist etc etc etc have zero mention it it - Nada, None, Zilch, Nein.

International organizations are doing fine and operating in environments that not only tax more but the employees receive double the benefits and pay. Furthermore small business flourishes more abroad than it does here, yet the right has people believe they care about small business. #######? everyone abroad knows it's the left who cares about small businesses, not the right.

The American people are deliberately kept ignorant, it's why they assume Europe is a failure and have not even heard of Canada or Australia. Someone working three jobs to make ends meet, has not time to think about or even find out that their equivalents in Europe, Canada or Australia only work one job and received 5 times the benefits.

Wherever I can, I buy American and most of all shop at either local or small businesses. This attitude is why you will not find one single abandoned town or Detroit equivalent in AUS. Heck, you see this in NYC, let alone out in smaller towns.

Edited October 21, 2010 by Heracles

[Obama 2012 1,714]

Last time I checked Paul, the Constitution focuses on We the People. Corporations, conglomerates, lobbyist etc etc etc have zero mention it it - Nada, None, Zilch, Nein.

International organizations are doing fine and operating in environments that not only tax more but the employees receive double the benefits and pay. Furthermore small business flourishes more abroad than it does here, yet the right has people believe they care about small business. #######? everyone abroad knows it's the left who cares about small businesses, not the right.

The American people are deliberately kept ignorant, it's why they assume Europe is a failure and have not even heard of Canada or Australia. Someone working three jobs to make ends meet, has not time to think about or even find out that their equivalents in Europe, Canada or Australia only work one job and received 5 times the benefits.

Wherever I can I buy American and most of all shop at either local or small businesses. This attitude is why you will not find one single abandoned town or Detroit equivalent in AUS. You see this in NYC, let alone out in smaller towns.

The constitution tells the Federal government what they can and cannot do... It's pretty simple. Has nothing to do with corporations really. Well, I'll take that back. If congress were doing its job in regulating commerce appropriately, we wouldn't have all this "free trade" BS and wouldn't be getting ####### from china on the cheap either... Of course, there again, this isn't a corporate failure, it's a government failure.. Corporations are subject to human nature and that nature is to do what works best for ones self...

Governments are too I suppose, but government officials are supposed to be there for the people, which we have found out most of the time they aren't... People come into Washington with the best of intentions and then get bombarded by BS and end up corrupt themselves. It's really a 'no win' scenario.... A lot of people don't like Mitt Romney, but he campaigned hard in 2007/2008 on the mantra of "Washington is broken." He was just trying to sell himself, but he used very valid arguments on where the government is out of control with lobbyists, lack of actual discussion, BS on one party changing door locks to keep the others out, etc...

If yuo want to fix the problem, you have to start from the top and work your way down.

[mawilson 2,133]

I thought we were told this could never happen - "just tax the heck out of everyone, they aren't going anywhere."

[Krikit 1,165]

Posts violating the TOS have been removed. Cut it out.

[mawilson 2,133]

But companies do move to countries with lower corporate tax rates. Wow, who knew?!