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I see your analysis as disingenuous. The company itself avoided paying taxes through various known mechanisms. Amazon did not simply shift the liability to the

by jack9 9y ago

I see your analysis as disingenuous. The company itself avoided paying taxes through various known mechanisms. Amazon did not simply shift the liability to the employees.

IanDrake 9y ago
One big point in the article was the option grants worth almost 1B. They fail to mention that the recipients of that 1B pay income tax on it. The article stating that it’s a non-cash expense is meant fool the uneducated to think it’s a free lunch, but like depreciation it’s a very real expense. Are you saying the 1B should have been taxed, then the remaining be distributed to employees and taxed again?
- u28uij 9y ago
  I think they were speaking more generally. Corp with huge profits pays nothing Employees with less pay taxes Yes that’s the rules but the rules are shit and the whole concept ephemeral and vague to the masses; they don’t see it
- IntronExon 9y ago
  “Corporations are people too my friend.” So the employees being separate people are not the corporation, and their tax situation is not the corporation’s. Can’t have it both ways, or rather, shouldn’t.
  - IanDrake 9y ago
    This is a pedantic point. The source of the wealth employees are paying taxes on comes from the corporation. Amazon either retains the earning (doesn’t grant options) and pays income tax on the retained earnings OR grants the options and the grantee pays the income tax on that amount. What both ways are you talking about? The 1B dollars got taxed. There was no free lunch.
    - deleted 9y ago
      [deleted]
    - bonesss 9y ago
      To expound a little: the same scenario applies to pure salary. If Amazon really wants to avoid taxes it can increase salary until its profits are 0. As you're pointing out: this makes the ledger '0' in one spot, but increases it at the same rate at another spot. It's not a tax dodge, it's tax rearrangement.
- jack9 9y ago
  > One big point in the article was the option grants worth almost 1B. No. It was the source of a deduction. I don't even think you understand what the article says. From the article: > $5.6 billion in income in 2017. The Seattle-based online retailer will end up paying out roughly $769 million in taxes for the year, but $724 million of that will be in foreign taxes. > For example, Amazon took out a $917 million tax deduction on stock options exercised by current or former employees. Just the e-commerce (not counting AWS or any of the other markets) was 60.5 billion U.S. dollars in the 4th quarter of 2017 alone. So it would be smarter to figure out how they came to 5.6 billion. The FIRST 5.6 billion they made, they paid no taxes on. Meaning, they had deductions (for some market, since every amazon vertical makes more than that) which allowed Amazon to make 5.6 billion tax free. Pedantic would be saying it wasn't "nothing" or pointing out that there was a bunch of money they did get taxed on. I stand corrected, you're not being disingenuous. You're just willfully ignorant.
  - URSpider94 9y ago
    You are confusing earnings and revenues. Amazon had revenues for its retail business of $60bn. But, in order to get that revenue, they spent a lot of money, maybe even more than that. The IRS doesn’t tax revenue, only profits - and Amazon’s profit last year was $5.6bn. And it seems like they may have paid $0 to the IRS in taxes, although they paid quite a bit to foreign governments, which is deductible.
  - IanDrake 9y ago
    Ugh, seriously kid, I’m not sure I can argue with someone who doesn’t understand the difference between net sales (your 60B in 4Q17) and operating income. It must all seem like a vast capitalist plot to you and no one can tell you different.
    - bonesss 9y ago
      > It must all seem like a vast capitalist plot to you and no one can tell you different. Just because people are ignorant doesn't mean there isn't a vast capitalist plot out there ;)

by jack9 9y ago

I see your analysis as disingenuous. The company itself avoided paying taxes through various known mechanisms. Amazon did not simply shift the liability to the employees.

IanDrake 9y ago

One big point in the article was the option grants worth almost 1B. They fail to mention that the recipients of that 1B pay income tax on it. The article stating that it’s a non-cash expense is meant fool the uneducated to think it’s a free lunch, but like depreciation it’s a very real expense. Are you saying the 1B should have been taxed, then the remaining be distributed to employees and taxed again?

u28uij 9y ago
I think they were speaking more generally. Corp with huge profits pays nothing Employees with less pay taxes Yes that’s the rules but the rules are shit and the whole concept ephemeral and vague to the masses; they don’t see it
IntronExon 9y ago
“Corporations are people too my friend.” So the employees being separate people are not the corporation, and their tax situation is not the corporation’s. Can’t have it both ways, or rather, shouldn’t.
- IanDrake 9y ago
  This is a pedantic point. The source of the wealth employees are paying taxes on comes from the corporation. Amazon either retains the earning (doesn’t grant options) and pays income tax on the retained earnings OR grants the options and the grantee pays the income tax on that amount. What both ways are you talking about? The 1B dollars got taxed. There was no free lunch.
  - deleted 9y ago
    [deleted]
  - bonesss 9y ago
    To expound a little: the same scenario applies to pure salary. If Amazon really wants to avoid taxes it can increase salary until its profits are 0. As you're pointing out: this makes the ledger '0' in one spot, but increases it at the same rate at another spot. It's not a tax dodge, it's tax rearrangement.
jack9 9y ago
> One big point in the article was the option grants worth almost 1B. No. It was the source of a deduction. I don't even think you understand what the article says. From the article: > $5.6 billion in income in 2017. The Seattle-based online retailer will end up paying out roughly $769 million in taxes for the year, but $724 million of that will be in foreign taxes. > For example, Amazon took out a $917 million tax deduction on stock options exercised by current or former employees. Just the e-commerce (not counting AWS or any of the other markets) was 60.5 billion U.S. dollars in the 4th quarter of 2017 alone. So it would be smarter to figure out how they came to 5.6 billion. The FIRST 5.6 billion they made, they paid no taxes on. Meaning, they had deductions (for some market, since every amazon vertical makes more than that) which allowed Amazon to make 5.6 billion tax free. Pedantic would be saying it wasn't "nothing" or pointing out that there was a bunch of money they did get taxed on. I stand corrected, you're not being disingenuous. You're just willfully ignorant.
- URSpider94 9y ago
  You are confusing earnings and revenues. Amazon had revenues for its retail business of $60bn. But, in order to get that revenue, they spent a lot of money, maybe even more than that. The IRS doesn’t tax revenue, only profits - and Amazon’s profit last year was $5.6bn. And it seems like they may have paid $0 to the IRS in taxes, although they paid quite a bit to foreign governments, which is deductible.
- IanDrake 9y ago
  Ugh, seriously kid, I’m not sure I can argue with someone who doesn’t understand the difference between net sales (your 60B in 4Q17) and operating income. It must all seem like a vast capitalist plot to you and no one can tell you different.
  - bonesss 9y ago
    > It must all seem like a vast capitalist plot to you and no one can tell you different. Just because people are ignorant doesn't mean there isn't a vast capitalist plot out there ;)