Meanwhile as a small business owner I have to find ways to deduct the air I breathe in order to stay at paying only 35% quarterly taxes every year. I have no sympathy for big business.
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Apple Targeted by EU Probe into Irish Tax Policies as U.S. Considers Tax Holiday for Cash Repatriation
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That is one problem I mentioned, although I don't recall whether it was in this thread. There are a few enormous divides when it comes to company size, and an ineffective tax policy puts more pressure on the smaller ones (smaller and larger being relative). I mentioned before that the actual percentage is arbitrary. These governments require something that scales effectively when applied to corporations of different sizes without relying too heavily on the power of audits. I mention that due to the cost of investigating any multinational.
I wasn't thinking so much of relocation. Even big companies do fail, and in the case of bankruptcy proceedings or any kind of downsizing, a single company can take out others with them. There's also the issue that if they are bought out, the buyer may or may not require much of the old infrastructure.
They don't want your sympathy, they want your continuing business, and they will innovate as much as they can, in order to achieve this.
Just as has been mentioned earlier in this thread, regarding the power of the larger group of takers, big business holds the power of the purse to a much greater degree than small/local businesses.
As has also been mentioned, that's the reality of modern life. Now, as it happens, I don't like this situation - neither from the political nor the financial viewpoint, which is why I maintain that business taxation is way too high. Your tax, at 35%, is way too high. If it were at, say, a flat 20%, you could breathe a little more easily, and big business would not need to pay accountants/lawyers so much to get that number down as much as possible. The fact that big business can get their actual rates down so low is due to incentive - if one needs to set up a system dedicated to tax reduction, why not use it to the max.
I agree with your sentiments, with one caveat. Not all of the profits are taxable in the US, the profit made in the UK, Germany etc should be taxed there in those countries.
I need to dig out the numbers but Apple has generated something like $15bn in cash profits which it has sheltered offshore, that's where my $50bn in legally dodged taxes comes from. Not all of that amount belongs to the US.
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UK corporate tax is 22%, Irish Corporate tax is 12.5% Apple don't even pay that ! When it comes to fiduciary duty of a company executive to minimise tax it means as low as possible, not to accept 20% if you can pay just 10% or 5% in Apple's case.
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Nor should you. I really hope the EU nails all of these companies. Apple is a fabulously profitable business, which is an excellent thing, but what it's doing tax-wise needs to be stopped.
Od course it's their duty to minimize tax payments - that's why I said "flat". If internationals, in particular, knew that their tax rate would be at, say, 20%, regardless of where they did business, and with few, common sense deductions available, things would settle down quite quickly.
All we would be left with are those who jealously hate profit, and the wealth it creates - and to hell with them!
You will never get all countries to agree on the same corporate tax rate and indeed they should not. Each country (or group) needs to control its own fiscal policy and the most important element is taxation both corporate and personal. The Irish have decided they need a very aggressively low tax rate of 12.5% to encourage business to locate there (the country has a long history of tax breaks, ie zero for authors / artists - amazing how many politicians are "authors" and businesses like aircraft leasing also enjoy low rates). The big swerve is that Ireland also has a law that says profits made / companies controlled from abroad are not taxable at all. So basically Apple routes he amounts of business through Ireland and pays zero.
By the way I double checked and Apple's cash pile / sheltered /untaxed profits are $160billion (I posted $150bn) so they really owe something like $40bn-$56bn depending in which country you believe the profits should be taxed. Tim Cook can talk all he wants about "we pay every dollar we owe" but the fact is Apple have swerved at least $40bn in taxes.
Just so you are in no doubt I very much encourage wealth creation and profits. They should be appropriately taxed and for a company like Apple to pay 5% is in my view a disgrace.
The price of oil is set by the market. And what have greenies done that's bad?
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What government do you propose cutting?
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Actually I would have a very low corporate profit tax rate, perhaps even zero, but have dividend taxes at the same rate as other income taxes.
I might have a corporate wealth tax as well.
Problem with corporate tax rate of zero and a dividend tax is it would kill the governments cash flow as companies horded cash. This is exactly what Apple has done, it has horded $160 billion upon which it has paid no tax. Governments need to pay for public services today.
I think the tax system is already too complex as it's all these offsets and multiple jurisdictions and transfer pricing etc which has created the problem. Do we really need another corporate tax and how would you define wealth ?
I am proposing removing a tax completely, and a wealth tax would discourage hoarding
. So I think it would be at worst neutral on complication.
I'd be happier about Apple's tax avoidance arrangements if it's offerings outside the US were better, like Maps and Siri services. Supposedly Apple charges the Irish subsidiary for various forms of research, yet precious little of the research seems to go anywhere other than the US.
I do appreciate why Ireland's tax rates came about, it was to encourage employment with the EU's support as at the time grants into Ireland where substantial. However the EU created a monster and the loss of revenues from Apple alone are 10's of billions never mind Starbucks, Amazon etc etc. There is also a question of the quality of those jobs as you mention, Dell came and went (to Poland I recall) when a lower cost country came along with that magic EU status.
I don't know what the EU's solution will be but I could well imagine individual countries taking action via additional sales type taxes which are paid by us the consumer, that's a blunt instrument but trying to tackle transfer pricing is too complex and the EUs tax laws are so full of holes it's easy to pick a path through them and pay so little.
The US is after Apple too, they want their 35% of the whole amount not just profits from sales in the US. It will be interesting to see how this plays out.
Anyway, it's Friday so slàinte
Indeed this is true. We get no US only services from iTunes Radio to proper reliable maps. Apple TV is also largely restricted. We don't even have one Apple store in the entire country. London has like 3.
And Ireland is the location of their EU headquarters.
Great so, I wouldn't mind something that isn't mindnumbingly predictable occurring in Irish politics.
Did you see anyone saying that we don't need somewhat big business? But, we don't need ONLY big business. We don't need to pump even more wealth to the top in the off chance that one of them will create the next huge hit. By the very virtue that they already have more money than almost any other time in history, and nearly the lowest taxes, yet little new business, that line is a complete lie. Building a stronger middle and lower class through better wages and benefits will do far more for the economy.
Well, I asked for specific, but I see you kept with the same lines from the normal conservative chant and just named off a bunch of wide-open agencies. Basically, you want to eliminate anything that seeks to protect the average person and allow business to run rampant with no control. Want to dump paint into a lake? Go ahead! Want to billow toxic smoke out of your stack? No problem! Want to have a factory with no emergency exits? They're just factory workers! Carry on.
If you can't operate a business without destroying the environment or having safe and fair working conditions, then you shouldn't be in business.
I have no idea what you mean with "tort"...that could mean anything.
I could get behind a lower rate with no or few deductions.
I do always find it funny that when anyone suggests that corporations with tens of billions in profits should be paying a fair amount of tax, they are labeled as anti-business, anti-rich, and anti-wealth.
Me too. If I had a tax rate closer to even 15-20% without the need to track 1000+ deductions yearly I'd be open to it.
Although I'm only doing personal taxes, I don't even take advantage of several deductions because the time involved to deal with them just isn't worth it to me. Yay! I can track all of my driving over the course of the year and save $50!!! Wooooo..oh never mind.
My taxes are always done by a team of accountants, once or twice just for fun, I have read some of the deductions. trips to the car wash, office stationary (paper clips rolls of tape) plastic coffee beakers. Items of clothing suits, shoes they are all carefully noted.
Originally Posted by Fishticks
I disagree and I think you would have done well down at Occupy Wall Street with your beliefs
I couldn't care less you disagreed. I think you do well down in some bank-office figuring out how to accaparate hard-earned money from customers.
It's true that small business owners (SBO) are at a disadvantage because multinational corporations (MNCs), by virtue of being MNCs, can structure their operations for the least tax while SBOs, by virtue of being smaller than MNCs, can't do that. It's also due to the fact that MNCs have more financial resources to pay for expert tax advice.
But why does the answer have to be to raise taxes on MNCs to bring them on par with SBOs? Why not end tax deductions that only MNCs are able to take advantage of and then lower the marginal tax rate? IMO, that would also have the effect of ensuring that SBOs and MNCs are on a level playing field.
WTO needs to rationalize corporate tax rates as well as tariffs
One thing that is very clear in all this is that corporate tax rates need to be rationalized internationally so that companies don't (have to) play these tax-avoidance games.
One thing that is very clear in all this is that corporate tax rates need to be rationalized internationally so that companies don't (have to) play these tax-avoidance games.
I wonder how upset foreign bankers would be with the USA if we had a tax holiday for repatriation of funds.