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>Comments like "companies should just pay their taxes" are like when laypeople say "companies should have websites that always work instantaneously & never have

>Comments like "companies should just pay their taxes" are like when laypeople say "companies should have websites that always work instantaneously & never have any downtime". I don't understand the analogy. Websites that 'always work instantaneously and never have any downtime' is technically infeasible, though you can get closer by pumping more money into the web side of your business. No company deliberately injects downtime into their website, but they do think it may not be the biggest priority, and hence there will be more downtime. On the other hand, you need to actively look for loopholes, and get access to tax lawyers and accountants in order to do something like a 'double-Irish'. That's not a failure to pump money into your accountancy division in the same way downtime is a failure to pump money into your web division. In fact, it's exactly the opposite - doing a 'double-Irish' would seem to require more money to be pumped into the tax law part of your business. The equivalent in your analogy would actually be exactly the opposite - if Google hired something like 'downtime lawyers' who would find the optimal way to inject downtime into their website. If Google sought out downtime, and actively pursued downtime. Pump more money into the web side of your business and you get less downtime. Pump more money into the tax lawyer side of your business and you avoid more taxes. The analogy is bankrupt. Reality is complicated, but even more complicated than reality is the tasks Google has set its tax lawyers to concoct to avoid paying taxes. I'm sure you yourself have a great many opinions, moral or otherwise, on subjects you don't know the technical intricacies of, but you hold those opinions because of a principle that applies to the base facts of those subjects. Along the lines of another commenter, I don't need to understand the current debate in moral epistemology and animal rights in order to have good reason to think kicking puppies is immoral, and I need even less knowledge to know that I don't want to see puppy kicking in society. I can dislike puppy-kicking, even if it turns out that puppy kicking is legal, or even moral - and I have a feeling you would too.

MrPowers 6y ago
> you need to actively look for loopholes, and get access to tax lawyers and accountants in order to do something like a 'double-Irish' What is the alternative? Multinational companies have to file tax returns in tons of different jurisdictions. Tax authorities are heavily biased and don't agree how transactions should be priced (they always want more tax revenue). Tax authorities often fight over the same profits and double tax. Listen, I'm not saying that "these poor corporations have it so tough". But complying with tax laws for multinationals is ridiculously complex. And these tax structures are needed to lower the compliance burden. The compliance burden can be huge for smaller companies. I've seen negotiations for small amounts of profit between tax authorities draw on for years. It's can be a massive cost for smaller multinationals. Do I think there should be something better, yes. But that feeling goes for the entire tax code. I think the US tax code is garbage. Some other countries are even worse.
- ipaddr 6y ago
  Multinationals have such a ridiculously complex time complying with the tax code so we should accept that they will create structures to pay little or no taxes? It is only complex because it has been setup that way. If they setup a simple structure they would pay more. So they don't.
  - Kalium 6y ago
    I believe the point the other person is making is that multinational tax compliance is inherently complicated. Moreover, it does not become simple and easy if a company just adopts a simple structure because the forces that drive that complexity are not a result of the complexity of a company's structure.
    - randoramax 6y ago
      Think of it as tax engineering: companies build devices to avoid paying too much taxes. It's a thing, you'd do it too if you had enough money to justify the investment in such engineering :)
      - lovecg 6y ago
        It sounds like what the other person is saying the primary motivation for this “engineering” is not to save money just because they could, it’s to avoid disputes and compliance risks as much possible (which incidentally results in them saving money). I can’t comment if that’s true or not, but I can easily imagine that this is the situation.

MrPowers 6y ago

> you need to actively look for loopholes, and get access to tax lawyers and accountants in order to do something like a 'double-Irish' What is the alternative? Multinational companies have to file tax returns in tons of different jurisdictions. Tax authorities are heavily biased and don't agree how transactions should be priced (they always want more tax revenue). Tax authorities often fight over the same profits and double tax. Listen, I'm not saying that "these poor corporations have it so tough". But complying with tax laws for multinationals is ridiculously complex. And these tax structures are needed to lower the compliance burden. The compliance burden can be huge for smaller companies. I've seen negotiations for small amounts of profit between tax authorities draw on for years. It's can be a massive cost for smaller multinationals. Do I think there should be something better, yes. But that feeling goes for the entire tax code. I think the US tax code is garbage. Some other countries are even worse.

ipaddr 6y ago
Multinationals have such a ridiculously complex time complying with the tax code so we should accept that they will create structures to pay little or no taxes? It is only complex because it has been setup that way. If they setup a simple structure they would pay more. So they don't.
- Kalium 6y ago
  I believe the point the other person is making is that multinational tax compliance is inherently complicated. Moreover, it does not become simple and easy if a company just adopts a simple structure because the forces that drive that complexity are not a result of the complexity of a company's structure.
  - randoramax 6y ago
    Think of it as tax engineering: companies build devices to avoid paying too much taxes. It's a thing, you'd do it too if you had enough money to justify the investment in such engineering :)
    - lovecg 6y ago
      It sounds like what the other person is saying the primary motivation for this “engineering” is not to save money just because they could, it’s to avoid disputes and compliance risks as much possible (which incidentally results in them saving money). I can’t comment if that’s true or not, but I can easily imagine that this is the situation.