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How can you assume that this money would circulate back into the US economy? You imply that it will be used to buy goods and services within the US and thereby

by aniro 10y ago

How can you assume that this money would circulate back into the US economy? You imply that it will be used to buy goods and services within the US and thereby serve the "greater good" of increased economic activity of the sort that produces jobs and greater financial well-being for the bulk of the citizenry. Assuming that it did "circulate back into the economy", it seems most likely this money would be funneled into the already bloated financial sector where it can most readily participate in the variety of internal US tax avoidance schemes.

edblarney 10y ago
"How can you assume that this money would circulate back into the US economy?" I'm saying that corporate profits returned from overseas are effectively coming back into the economy. Actually - this is statement of fact. It's 'in the US system' as opposed to overseas. Second - your position basically implies that 'corporate profits' are not beneficial to the US economy, which is a stretch. Almost all of the money coming back will be put to use. Do you want to know just one of the many ways: STARTUPS The massive number of startups being funded, at amazing valuations, is a function of 'extra cash' in the financial system. All of those failed startups employees are being paid with those dollars. And in many ways 'it's good' - they learn, they move on to better companies etc.. Massive amounts of money coming back into the US economy is a 'good thing' - the onus I think would be on you to demonstrate how this could really be a negative thing, and I suggest it would be impossible to demonstrate.
- aniro 10y ago
  I wouldn't exactly call Apple's cash war chest "money circulating within the US economy" but I will take your point as given.. by definition money that returns to the US will technically be (once again) "in the US economy". A significant portion of those profits were shifted overseas to avoid taxation within the US. Providing a "tax holiday" in order to repatriate those monies essentialy validates the tactic of shifting profits overseas to avoid taxation until a critical mass of dollars has accumulated so that it is politically attractive to institute another "holiday" just to bring the money home sans the tax. This tactic is starving the US Treasury of funds needed for the People's Government to perform its functions. This isn't the first go around with this, it is in fact becoming cyclical. https://en.wikipedia.org/wiki/Repatriation_tax_holiday https://en.wikipedia.org/wiki/Repatriation_tax_holiday In the meantime, these entities are parking dollars out of reach (actively removing them from circulation) instead of investing or spending them within the US.. where they would have been circulated anyway if not for the tax avoidance. They are being rewarded for removing the money and then politicians are being hailed as heroes for "convincing" them to return it by helping them avoid paying taxes to put it back in the economy it was removed from. I fail to see how you think any of this is beneficial to the US economy.
  - nodamage 10y ago
    > A significant portion of those profits were shifted overseas to avoid taxation within the US. In Apple's case this is not true at all. The money they are holding in Ireland comes from profits generated overseas, not from profits made in the US. (This is all well documented from the Senate investigation into Apple's finances a few years back.)
  - edblarney 10y ago
    "In the meantime, these entities are parking dollars out of reach (actively removing them from circulation) instead of investing or spending them within the US.. where they would have been circulated anyway if not for the tax avoidance. They are being rewarded for removing the money " No - they are not removing anything. Listen - if you lived in Dubai and earned $300K/year and paid minimal taxes, and moved back to the US with $100K in your Dubai account ... If you left it there, and used it for travelling overseas, making investments, there would be no tax. If you brought it to the USA - and it would be taxed at say 25% ... Would you leave it there, or bring it back? Would you be a tax evader/avoider for leaving it there. No. It's perfectly reasonable for you to want to leave your money overseas. (I should point out that this is merely an analogy, personal taxes don't work this way for Americans.) Apple has done nothing wrong. If the US adjusts it's tax system to be more commensurate with how the entire rest of the world works ... it would be very beneficial to America overall. I really don't like Trump, but I think he's going to fix this one issue, and that's going to be quite a big deal and a 'good thing'.
    - aniro 10y ago
      This is a BS example. I am going to assume that you don't realize this because I otherwise have to assume you are being crass and disingenuous. People are not fictional entities that can be created and destroyed at will; corporations are. Shell corporations are being created within tax haven countries for the sole and explicit purpose of parking revenue within the boundaries of tax friendly regimes. The companies are not actually moving anything to these countries in terms of physical assets or corporate function.. only revenue. This is nothing like a person moving overseas and working and getting payed within that country. They may have found a legal framework that makes them within the bounds of US & International law in order to do so. The problem with doing this is the inability to repartiate those funds without paying tax in the country you wish to move the money to. There is nothing broken about taxing profits. You may not agree with the rate of taxation for corporations, but you would be at odds with the vast majority of the electorate. Companies choose to park revenue overseas in protest of the US tax rate. Trump? I don't think he will fix anything. His stated intent is to cut taxes and increase spending. Maybe lower corporate taxation is in there, but that doesn't "fix" anything. There will always be some country, somewhere willing to go lower. This shell game will continue.

by aniro 10y ago

edblarney 10y ago

"How can you assume that this money would circulate back into the US economy?" I'm saying that corporate profits returned from overseas are effectively coming back into the economy. Actually - this is statement of fact. It's 'in the US system' as opposed to overseas. Second - your position basically implies that 'corporate profits' are not beneficial to the US economy, which is a stretch. Almost all of the money coming back will be put to use. Do you want to know just one of the many ways: STARTUPS The massive number of startups being funded, at amazing valuations, is a function of 'extra cash' in the financial system. All of those failed startups employees are being paid with those dollars. And in many ways 'it's good' - they learn, they move on to better companies etc.. Massive amounts of money coming back into the US economy is a 'good thing' - the onus I think would be on you to demonstrate how this could really be a negative thing, and I suggest it would be impossible to demonstrate.

aniro 10y ago
I wouldn't exactly call Apple's cash war chest "money circulating within the US economy" but I will take your point as given.. by definition money that returns to the US will technically be (once again) "in the US economy". A significant portion of those profits were shifted overseas to avoid taxation within the US. Providing a "tax holiday" in order to repatriate those monies essentialy validates the tactic of shifting profits overseas to avoid taxation until a critical mass of dollars has accumulated so that it is politically attractive to institute another "holiday" just to bring the money home sans the tax. This tactic is starving the US Treasury of funds needed for the People's Government to perform its functions. This isn't the first go around with this, it is in fact becoming cyclical. https://en.wikipedia.org/wiki/Repatriation_tax_holiday https://en.wikipedia.org/wiki/Repatriation_tax_holiday In the meantime, these entities are parking dollars out of reach (actively removing them from circulation) instead of investing or spending them within the US.. where they would have been circulated anyway if not for the tax avoidance. They are being rewarded for removing the money and then politicians are being hailed as heroes for "convincing" them to return it by helping them avoid paying taxes to put it back in the economy it was removed from. I fail to see how you think any of this is beneficial to the US economy.
- nodamage 10y ago
  > A significant portion of those profits were shifted overseas to avoid taxation within the US. In Apple's case this is not true at all. The money they are holding in Ireland comes from profits generated overseas, not from profits made in the US. (This is all well documented from the Senate investigation into Apple's finances a few years back.)
- edblarney 10y ago
  "In the meantime, these entities are parking dollars out of reach (actively removing them from circulation) instead of investing or spending them within the US.. where they would have been circulated anyway if not for the tax avoidance. They are being rewarded for removing the money " No - they are not removing anything. Listen - if you lived in Dubai and earned $300K/year and paid minimal taxes, and moved back to the US with $100K in your Dubai account ... If you left it there, and used it for travelling overseas, making investments, there would be no tax. If you brought it to the USA - and it would be taxed at say 25% ... Would you leave it there, or bring it back? Would you be a tax evader/avoider for leaving it there. No. It's perfectly reasonable for you to want to leave your money overseas. (I should point out that this is merely an analogy, personal taxes don't work this way for Americans.) Apple has done nothing wrong. If the US adjusts it's tax system to be more commensurate with how the entire rest of the world works ... it would be very beneficial to America overall. I really don't like Trump, but I think he's going to fix this one issue, and that's going to be quite a big deal and a 'good thing'.
  - aniro 10y ago
    This is a BS example. I am going to assume that you don't realize this because I otherwise have to assume you are being crass and disingenuous. People are not fictional entities that can be created and destroyed at will; corporations are. Shell corporations are being created within tax haven countries for the sole and explicit purpose of parking revenue within the boundaries of tax friendly regimes. The companies are not actually moving anything to these countries in terms of physical assets or corporate function.. only revenue. This is nothing like a person moving overseas and working and getting payed within that country. They may have found a legal framework that makes them within the bounds of US & International law in order to do so. The problem with doing this is the inability to repartiate those funds without paying tax in the country you wish to move the money to. There is nothing broken about taxing profits. You may not agree with the rate of taxation for corporations, but you would be at odds with the vast majority of the electorate. Companies choose to park revenue overseas in protest of the US tax rate. Trump? I don't think he will fix anything. His stated intent is to cut taxes and increase spending. Maybe lower corporate taxation is in there, but that doesn't "fix" anything. There will always be some country, somewhere willing to go lower. This shell game will continue.