5 ms·
Or, told another way: For several years, Zoom has spent much more than it has earned ($300M more in fact), on expenses like staff, rent, services and supplies
by ephextom 6y ago
Or, told another way:
For several years, Zoom has spent much more than it has earned ($300M more in fact), on expenses like staff, rent, services and supplies from other companies - which will have generated large amounts of income taxes, payroll taxes, sales taxes, franchise taxes, municipal taxes, etc.
This past year they have grown dramatically, and will have generated even more income taxes, franchise taxes, municipal taxes, etc than ever before, and also some present or future capital gains taxes due to the huge increase in the company's valuation.
They just don't have to pay federal income tax yet, until the net income they make exceeds the net losses they recorded over previous years.
- zpeti 6y agoBut hey, at least we got thousands of clicks from outraged people about tech companies not paying taxes? KPIs met! Win!
- erhk 6y agoWhy should income tax be a substitute? Where is my subsidy for having gone into debt for a degree?
- indymike 6y agoDebt is not a loss. It is a liability.
- gruez 6y agoBecause corporations are taxed on profit but you as an individual are taxed on income.
- rhino369 6y agoThere are some deductions for tuition and student loan interest. But I do think that student loan payments should be fully deductible against income.
- question000 6y agoIs this sarcasm? Why wouldn't I still be outraged? Because they have "tax credits". Okay can I as individual get tax credits by going into debt? If I can't "tax credits" then Zoom shouldn't get them. It's just common sense. Seriously the current tax structure in the United States seems to be anti-human being. Humans have to pay up front in cash 100% each year, corporations can just claim they are writing off debt, apparently even in years they have no debt. Where does it stop? Why would someone defend this who pays taxes themselves?
- pjc50 6y agoIndividuals are not taxed on a "profit and loss" basis.
- rs999gti 6y ago> Individuals are not taxed on a "profit and loss" basis. Is it safe to assume you have no investments or save for retirement?
- pjc50 6y agoI have those .. in their respective tax shelters. (In the UK these are ISA and personal pensions, and on both I don't pay income tax. This vaguely corresponds to the 401k system)
- indymike 6y agoGoing into debt is not the same as a loss.
- bkirkby 6y agoCan you, as an individual, provide the value of a Zoom that benefits society? Are you paying thousands of people a salary (paying taxes on their salary)? Are you providing a service that people are using to, ostensibly, make their lives better? If so, you should incorporate +and probably already do if you happen to employ thousands of people) since laws around incorporating are there to encourage people to take the risk of providing these values. Societies that burden business with taxes generally do not understand that businesses are the lifeblood of economy and draining the lifeblood makes the economy sick.
- deleted 6y ago[deleted]
- TheAdamAndChe 6y agoThey don't have to pay taxes this year because they didn't make money in previous years? How are previous years relevant to this year? I know what they're doing is legal, but it sure is silly. Their net loss over the last few years wasn't because they couldn't have been profitable. It was part of their business strategy.
- bkirkby 6y agoA strategy that grew their capacity to provide value to the world. The economy is more complex than "look, money, let's take it for government."
- TheAdamAndChe 6y agoYes, and they've been rewarded with profits and a soaring stock price. Why shouldn't they pay taxes for that? It's undoubtable that they used federal and public infrastructure in the process of making and growing the company.
- datavirtue 6y agoThen again, why should the entity be punished for creating value and jobs and competition? Please tell. I guarantee all the people involved were taxed. I would rest a lot easier knowing that the organization that employs me didn't have to worry about taxes. Instead it has to employ an army of people just pay them. Double taxed, everyone is.
- bkirkby 6y agoThe impulse to see "soaring stock price and valuation" as a reward that can be drained is exactly the kind of sophomoric economic view i was referring to. it's quite obvious that if you took all of the value of a company the company would cease to exist along with the benefit they bring to society. you don't want to take all of their value? you just want to take the "fair share"? how do you know what the "fair share" is that doesn't harm the capacity of the company to continue to provide value? fairness would be they pay for the public goods and services they use. do they employ trucks to deliver their product? then they should pay gas taxes on their deliveries. but, wait, they already do that so we want something _more_ fair than being treated the same as everyone else. that still leaves us with the unknown of "how much more_than_fair_taxes we should require of a company and be sure not hinder it's ability to provide value?"
- rayiner 6y agoExactly. Carryover losses are a way of dealing with the fact the tax code seeks to impose taxes on a continuous variable (gains in wealth) but samples at discrete intervals (yearly). They’re necessary to avoid distortion that would result if a company with -$50 one year and $70 the next were taxed much more heavily than one that earned $10 two years in row. The alternative would be to give refunds for losses.