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Uber used 50 Dutch shell companies to dodge taxes on $6B in revenue
- cgb223 5y agoIt’s crazy that we’re at the point of such massive globalization that sophisticated companies can literally play different business/tax laws of countries off of each other
- cyanydeez 5y agoyou mean the company that dodges regulations 3verywhere is dodging taxes everywhere?
- varispeed 5y agoSome jurisdictions don't require a company to pay tax on profits made overseas.
- djoldman 5y agoLarge multinational Corp takes advantage of legal tax loopholes. Nothing new here.
- agumonkey 5y agoYou forgot the added icing of "new kid on the block company wanting to disrupt the world uses good old scam technology to evade taxes". Gotta give credit to travis, we all appreciate respect for traditions
- musicale 5y agoIt has also managed to: - avoid taxi regulation and taxes by claiming it is not a taxi operator - avoid other taxes by claiming its employees are independent contractors
- agumonkey 5y agoI hate to say this but I really wish harm on this company. Whatever hacker group decides to have fun with them will bring me great joy.
- lmm 5y agoThey should be held to account, but legitimately, legally. Their whole business model is based on crime. I don't understand why we don't see not only prosecution of their leaders, but RICO charges against their investors too.
- EvilEy3 5y agoBecause they created the best service so far. Taxi was a shit show before Uber. Sort of like Jobs and smartphones.
- agumonkey 5y agoNah there's a world of difference between Uber and Apple. Uber blatantly admitted wanting to wipe the old market and get a monopoly. They clean used big pockets to flood cities with low prices and harm old businesses. When issues arose they pushed the burden onto drivers and users.
- Syzygies 5y agoIndividuals are subjected to "alternative minimum tax". Why not corporations?
- Decker87 5y agoCause they're not people. Oh wait...
- avs733 5y agoBecause individuals don’t have the ability to author the tax code like corporations do.
- 0goel0 5y agoIndividuals can't pretend to be based in Ireland to not pay US taxes. US taxes global individual income, but not global corporate profits.
- dkarras 5y ago>US taxes global individual income... Always wondered why US citizens do not make a bigger deal out of this. If I understand correctly, if you are a US citizen, but live somewhere else in the world, IRS still expects to be paid tax from your individual income in that foreign country (possibly in addition to the tax you pay in your country of residence) right? I assume there are minimum income thresholds but still... Are there even any other countries that do this?
- thrill 5y agoPlease deflame the headline. Tax avoidance is not tax dodging.
- happytoexplain 5y agoWhat's the difference? Legality? If so, I'm not sure anybody really cares about whether it's legal (in an intellectual sense). People are much more interested in morality and whether a system is working well for society.
- syshum 5y agoDo people really want to have a debate on the ethics and morality of forcibly taking property, income, and labor from people or businesses under the threat of violence? Aka taxation?
- flukus 5y agoProperty ownership doesn't exist without threat of violence. What's to stop me taking the phone you're holding? It's the threat of violence from you or society in general. Money and taxes are just abstractions on top of the property ownership one, if you want to get rid of taxes you'll need to get rid of property ownership. Many cultures were this way.
- syshum 5y agoRofl... Sorry no you are completely off base. First off I hope the only that keep you from being a thief is not that someone would defend themselves from your attempt. Personally I steal from people as much as I desire to. Which is none at all However self defense is not in viewed philosophy as a threat of violence. Violence that we are talking about here is the itiation of violence for which governments alone have taken the unethical position they have the lawful and exclusive right to said it itiation of violence in service 'of the greater good' Finally you in no way need to git rid of property ownership to get rid of taxation. Especially income based taxation like we are talking about here. Income based taxation being the most unethical of all forms of taxation.
- jonas21 5y agoI don't fully understand the part about Dutch shell companies, but it seems perfectly believable that Uber would have $6B in revenue and still operate at a loss (and owe no income taxes). Isn't that the big criticism of Uber's business model -- that they can't turn a profit at rates people are willing to pay while also compensating drivers?
- Ceezy 5y agoWell Travis got paid...
- staticautomatic 5y agoThis begs the question of what purpose the shell companies serve.
- applepple 5y agoMaybe revenue laundering using borrowed credit? I wouldn't be surprised if some day we discover that many corporations the tech space have been engaged in some kind of global credit laundering scheme using shell companies as a filter to systematically separate credit from debt in order to generate artificial revenue for big tech corporations... Money extracted straight from the big banks. They should refer to this scheme as a 'Clam farming' because they just load up the shell companies with bank loans then extract the meat and toss away the shell.
- KirillPanov 5y agoWhat kind of bank makes business loans without encumbering any collateral?
- applepple 5y agoWhy not just create intangible collateral out of thin air? E.g. crypto? Then you just use some of the credit to pump up the value of the collateral to meet the bank's expectation.
- varispeed 5y agoThis should be stamped out and severely penalised. I'd even go as far as banning such company from operating in the country until they close entire tax avoidance network. If you wanted to create a local Uber clone, you just won't be able to compete because from the start you'll have to pay probably order of magnitude more tax than a big corporation. Then less competition means less innovation, consumers are worse off and capital is drained off the country. Another problem is that in many western countries anti corruption bodies just drain the tax payer and do nothing. I can see plenty of examples of blatant corruption, but I have not heard of anyone being charged let alone if there was any investigation going on.
- briffle 5y agoI wouldn't be so harsh, but I would stop allowing them to sue in US court for some things. Sorry, your IP is in the Netherlands, go file there. See how quick many companies pull their IP back.
- DrSiemer 5y agoNot many I expect. Needing to hire Dutch lawyers is not such a big hurdle when you are saving billions.
- CRConrad 5y ago"That's a Dutch verdict you're waving around there. We'll do something about the IP violation you're claiming when you have one from this jurisdiction... And we'll see that case once you've registered the IP in question here."
- imgabe 5y agoCompanies pay taxes on profits not on revenue. This is meaningless outragebait.
- paxys 5y agoWhile that is true (depending on the jurisdiction), I find it weird that this is so readily acceptable when talking about a corporation when all of us are taxed on our income before it even reaches our bank account.
- imgabe 5y agoIf it's more fair to tax profits than revenues, we should be advocating for individuals to be treated in the more fair way, rather than advocating for corporations to be treated in the less fair way, don't you think? Besides, corporations generally have outside sources of funding other than income, while people generally don't. Thus corporations can run at a deficit, sometimes for a long time, while they figure out how to turn a profit. Do you think there's really a societal benefit to drive new businesses into bankruptcy before they get their footing by taxing them while they're losing money?
- anomaly_ 5y agoIndividuals are broadly taxed like companies in most western countries, it just turns out that most individuals don't actually incur many expenses in producing their income.
- deleted 5y ago[deleted]
- mrgordon 5y agoThe vast majority of W-2 workers can't deduct unreimbursed employee expenses. So it’s not even that they don’t incur them, but rather that “employees” aren’t eligible
- 0goel0 5y ago
- nodesocket 5y agoInstead of blaming the corporations for having good attorneys and accountants how about we simplify corporate taxes and close the loopholes? The previous administration tried to do it, but quite honestly I don't think democrats have any interest in simplifying taxes. Their platform seems to be blame corporations for not paying their fair share, while wealthy democrats utilize loopholes and intentional tax complexity for their own gain.
- paxys 5y ago> Uber transfered its intellectual property through a $16 billion “loan” from one of its subsidiaries in Singapore that in turn owns one of Uber’s Dutch shell companies, a manuever that grants the company a $1 billion tax break every year for the next 20 years, the researchers found. Shit like this makes my head hurt and infuriates me at the same time.
- nceqs3 5y agoBe mad at politicians for writing tax codes that work like this rather than companies for taking advantage of them.
- jelling 5y agoNah let’s do both. If a company wants to spin a pro-social image - Uber is currently asking consumers to donate vaccine rides - then they sure as hell can take the heat for avoiding pro-social taxes. At a minimum, they should pay that tax savings towards vaccine rides. I won’t hold my breath.
- pstuart 5y agoThat makes it sound like the companies are innocently stumbling upon these opportunities when in fact they're actively lobbying/buying these changes.
- quantified 5y agoYou don’t need to choose one or the other.
- happytoexplain 5y agoWhy not both? Dissatisfaction drives change. Yes, companies are expected to take advantage of legal means of increasing value, but there is a spectrum of behavior between "shrewd" and "immoral" that still falls entirely within "legal", and the individual human beings in the affected society reasonably have opinions about where the line is. When the numbers are too disgusting, it's OK for people to express dissatisfaction with both lawmakers and the company in question, market forces be damned. And let's not forget that the companies frequently play an outsize role in influencing the written laws. The line between "playing the game" and "cheating" is very fuzzy in real world systems.
- ilrwbwrkhv 5y agoLol of course Uber did it. If not them then whom?
- mycentstoo 5y agoIn my opinion, this is example of poor/incomplete regulation. Using sports as an analogy, it's like if a game was designed poorly, we have the expectation that players would act in good faith to not take advantage of rules. But players have the incentive to win, not act in good faith.
- the_arun 5y agoI wouldn't be surprised if there other big companies doing the same. So we need to fix the regulations to close this loophole.
- willcipriano 5y agoLoophole makes it seem like it was accidental. This happens over and over again, it's on purpose.
- Dah00n 5y agoThe regulation is likely working as intended. The bug is the disclosure here.
- manquer 5y agoI don't think there any actual expectation by policy makers that there will be good faith. These rules are designed this way intentionally. IMHO the consultants and lobbyists benefit from such convulted loopholes . These setups are only possible for large consultants to deliver for large consultants and policy makers have plausible deniability when there is no obvious loopholes and benefit from lobbying perks , revoking doors, election donations if not outright corruption.
- sdljfjafsd 5y agoYes, for me this is flopping in soccer and basketball. There's a pro for the athlete (chance of foul called) while the con is little to none. Hence both sports have floppers. The regulatory system must adapt to those who take advantage of the spirit of the policy but adhere to the letter of it. Obviously this is a constant issue, but what won't work is trying to "shame" the bad actors through hearings, media, etc. Policy must constantly evolve, esp. in areas like taxation. Also for those who are better versed with law, is it possible that companies can legally defend actions like this by arguing they are maximizing shareholder legally and thus, they are obligated to do so?
- tkubacki 5y agoThe only way to stop this, is to create income (eg. 1-2%) based tax regulations instead of profit based. No way to cheat.
- arsome 5y agoSome industries are very low margin while others are extremely high, I don't think this is viable without breaking a huge chunk of the economy.
- manquer 5y agoDepends on how it is structured. One way for example could be akin to a cash (and equivalents) tax on holding large amounts. It would incentize spending the cash in r&d , acquisitions , dividends etc. Low margin companies will not be too badly affected
- eloff 5y agoThat's not a revenue tax anymore. That just forces companies to minimize their cash stockpiles through investment, inventory, dividends, etc. How does that make the tax system fairer?
- manquer 5y agoAll those categories have already taxes associated with them Expenses -( VAT/GST etc) R&D/salaries - income tax for employees Divendent - income and other taxes Acquisitions/investments - seller pays capital gain tax etc Disincentizing savings to boost the economy is not only applicable for regular people it also applies for companies. Low interest rates are really today applicable for us. Companies with billions of dollars are getting enough returns to keep cash rather than spend it.
- sdljfjafsd 5y agoAs other people have pointed low margin businesses like fintech would get skewered with this. For example, payment processing companies recognize the value of the transaction as revenue even though their cut is 1-2%. You would shift the gaming of system from happening on the net income level to gaming of the system happening on the revenue level.
- wdb 5y agoI always feel a bit sad when I read my home country is used for these kind of things. Most of the time the companies still are depending on services of these countries to be able to be in business but don't pay their fair share.
- beckman466 5y ago> I always feel a bit sad when I read my home country is used for these kind of things. Het is toch echt andersom. Nederland doet dit al jaren om in de ‘good graces’ van Amerika te zijn. Are you surprised when you see this news?
- wdb 5y agoThat's true. Personally, I wouldn't mind if these kind of constructions are being stopped by the government but I don't see that happen anytime soon. Not surprised about the news at all. Just don't like if these kind of constructions are used in such manner. I understand you want to lower the tax burden but this is going a bit too far imho. Of course, Uber is not the only one.
- EvilEy3 5y agoBut hey, maybe NL will get proper FANG companies instead of Uber and Amazon.
- Proven 5y agoVisit a psychologist? Most people would be happy knowing they live in a country where it is possible to pay less tax and protect one's money from the predatory state. Sounds like you'd prefer to live in North Korea or France. That's not normal.
- DrSiemer 5y agoDoes the Netherlands get any benefits by offering these "services"? Is the gratitude of those using them beneficial? To whom exactly? And if not, then why is it not stopped? It is not exactly a poor county, that has no choice but to let things like this happen for some dirty dollars on the side. It should not be too difficult to at least catch the biggest fish playing this game.
- nautilus12 5y agoMore proof that we don't need to increase taxes. We just need to enforce our existing taxes better.
- IdontRememberIt 5y agoIf IP and shell companies infuriate you. I invite you to investigate why all billionaires have foundations or its cousin structures and "give" their wealth to it... Clue: tax and inheritance (tax) avoidance. Bill, Buffett, etc. are hypocrites. But it is not new, even in the Bible they spoke about it (Matthew 6:2): "So when you give to the needy, do not announce it with trumpets, as the hypocrites do in the synagogues and on the streets, to be honored by men."
- thisCtx 5y agoIMO most of the “exceptional” people in a country “by of and for the people” are hypocrites for waiting on billionaires to fix things How is political capitulation by the masses exceptional? Covid offered a perfect opportunity for info workers to show solidarity with on-site workers by not opening those laptops at home. But really it’s the leopards fault they keep eating our faces because we refuse to build a cage (higher taxation, breaking up monopoly). The solution is not new either as we just went through it in recent memory with ATT. I’m rather tired of the general public pointing fingers at everyone but themselves. Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it.
- rjbwork 5y ago>Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it. A general strike? You're asking for people to cooperate in a mass prisoner dilemma on a societal scale. Never going to happen with the complete lack of labor organization in the US.
- lumost 5y agoGeneral strikes occur are strange occurences. The few examples such as France in 1968, or the Soviet Union in 1991, or the Praque Spring in 1968 occurred for reasons more akin to "mass social unrest/dissatisfaction" than organized labor activity.
- gogopuppygogo 5y agoAnyone with any money should setup a trust. Especially if they want to marry. Done right it’s an amazing way to protect your wealth. Better protection than a prenup can provide.
- Lammy 5y agoNote: Dutch shell != Dutch Shell https://en.wikipedia.org/wiki/Royal_Dutch_Shell https://en.wikipedia.org/wiki/Royal_Dutch_Shell
- fighterpilot 5y agoI've heard this suggested before: abolish all corporate tax and increase capital gains tax to equal income tax. This will level the playing field between large and small businesses, since the former has the means to dodge byzantine corporate tax laws. It will also give an incentive for companies to stay onshore. Any downsides?
- mdorazio 5y agoYes. > increase capital gains tax to equal income tax Is far easier said than done. For example, would you include the $250K capital gains deduction for selling a home in that? Additionally, you're probably referring to raising long-term capital gains tax, but that has the side effect of disincentivizing long-term investment in favor of more short-term speculation.
- fighterpilot 5y agoHow would it disincentivize long term investment? In the US dividends are taxed at capital gains. I believe if a company makes $X and gives it out as a dividend it makes no difference to the investor whether the split between capital gains and corporate tax is 25/25 versus 43.75/0?
- deleted 5y ago[deleted]
- pentae 5y agoNot at all. Many countries already do this. For example, in Australia, capital gains is considered as income. It contributes to your progressive tax bracket the same way income does. For property, you do not pay capital gains tax when you sell your primary residence (that you live in) but you do on investment properties.
- klyrs 5y agoWhat's to stop me from hiding my capital gains in a series of shell companies?
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- Proven 5y agoGood, I love it! Less tax, lower prices, smaller government.
- seaourfreed 5y agoCongress is corrupt (via lobbyists). Congress would make this illegal if congress men/women didn't sell out American Citizens. 88% of the cost of the US Fed gov is paid for by taxes by workers (income taxes). Less than 12% comes from all corp/business taxes combined with capital gains (taxing the rich 1%). Business shifting tax burden to workers is a massive scale problem. $3.5 Trillion = US Tax Revenues (2019) and 88% came from workers.
- bartart 5y agoIt's also worth noting that the top 1% pay about 40% of all income taxes at the federal level, and they earn about 20% of annual income from all sources (http://hdr.undp.org/en/indicators/186106 http://hdr.undp.org/en/indicators/186106). So classifying 88% of federal revenue as paid by regular workers might be a bit misleading
- lovich 5y agoDid 100% of the wealth generated by the 1% come from their income taxed at that rate, or did they have a significant portion of their generated wealth come from capital gains? Classifying the 1%'s wealth by talking about their income as if its 100% of their wealth might be a bit misleading.
- tomnipotent 5y ago> might be a bit misleading Does wealth matter when you're talking about taxes? I was under the impression "1%" was in reference to share of adjusted gross income, not total wealth.
- greycol 5y agoIn the same spirit it might be worth noting that 'earn about 20% of annual income" could also be considered a bit misleading 'receive about 20% of annual income" would be a less controversial term.
- onlyrealcuzzo 5y ago99% of the top 1% are "normal workers" like me - engineers at Google - or my cousin - a radiologist - or one of my best friends - an investment banker - or lawyers, or owners of successful small businesses, etc... These "normal workers" pay a lot of that 40% of the tax bill. There aren't that many CEOs of Fortune 500 companies and board members, A+ list celebrities, and aristocrats. You're getting into the .01% - that's still 32,000 people! Chicago Booth put together an article with graphs to really show how much the top 0.01% has diverged [1]. The top 0.01% still pays A LOT of the income taxes - about 5% - but that means, mostly hardworking normal people in the top 1% are paying the other 35% of that 40% share of the tax bill. It's not like Bill & Melinda Gates are paying 40% of the tax bill by themselves... [1] https://review.chicagobooth.edu/economics/2017/article/never-mind-1-percent-lets-talk-about-001-percent https://review.chicagobooth.edu/economics/2017/article/never...
- bourgwaletariat 5y agoHonest question: Who here will stop using Uber because of this? Anyone?
- EvilEy3 5y agoGive me an alternative that is better or comparable and I'll think.
- bourgwaletariat 5y agoNot using them. A cab. Your own car. A rental car. That other ride sharing company. Or the other one. Or the other one. Your buddy with a car. The next door neighbor with a car. Walk. A bike. The train. Move somewhere else. Or just keep whining about how the world is oppressing you and Uber has saved you from your own misery.
- youngtaff 5y agoStopped using them a long time ago
- whywhywhywhy 5y agoPlenty of companies do this, especially successful companies. Google, Apple are all doing the same sort of thing this isn't unique to Uber by any means.
- bourgwaletariat 5y agoStop using them too, then. I already did.
- CRConrad 5y agoI won't... But only because, to be able to stop using them, I would have to have used them.
- deleted 5y ago[deleted]
- fnord77 5y agothere are no longer any effective checks and balances against corporate power.
- seattle_spring 5y agoIt's nuts to me that our government lets this happen, yet strives to vilify the upper middle class as the "billionaire class" and tax the shit out of them.
- sgerenser 5y agoI’ve never heard the upper middle class called the “billionaire class.” Can you give an example?
- CryptoPunk 5y agoReally, the income tax, both corporate and personal, should be abolished. Any success towards legally minimizing income tax liability should be welcomed by any one who believes in minimizing the power of the state to violate the rights of private citizens, and favors more economic growth.
- holoduke 5y agoThere should be a jury of 50 people who can put the leaders of these companies in jail for a lifetime. These cunts leading these companies do not respect equal taxes at all. But this will never happen of course.
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- EvilEy3 5y agoAnd they also fired 200 Dutch people from their Amsterdam office. Way to show gratitude, Uber.
- mirekrusin 5y agoNot to be confused with Royal Dutch Shell company!
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- PaulRobinson 5y agoI find tax avoidance stories/headlines that focus on revenue numbers (which aren’t taxed), vs profits (which are), grating. I get that the trick being used is to move some of the profits into loan payments or license fees to reduce profitability but you can’t expect people who care about business to care about headlines like this. If somebody tells me “X paid Y in taxes on Z revenues”, I’m just figuring out their margins. Telling me that 50% of their cost base is a loan or license fee to a parent or sister company tells me a lot more…
- tiernano 5y ago> Uber’s sophisticated efforts to achieve little or no tax burden on multibillion-dollar global revenues highlights a long-standing challenge governments face in enforcing tax compliance among wealthy corporations and individuals across borders. But... It's legal... None of it is illegal... They are compliant with the law... It's the law and the government's that need to change... Or am I missing something here?
- yxhuvud 5y agoIf this is only hiding the potato in layers and layers of companies in different countries, then they have still paid less taxes than what they owe, which clearly is against the law and will generally require them to pay the missing taxes. If it is done through negligent reporting to tax authorities, then more laws may have been broken.
- rjknight 5y agoYes, this seems correct. This behaviour is "compliant" in the sense of "complying with the law", so calling it a "challenge... in enforcing tax compliance" seems straightforwardly wrong. The tax laws allow this. Preventing it requires changing the law. If a government complains about this problem but doesn't try to change the law, then it's reasonable to ask if the government is truly serious about doing anything. However, it's also true that this a difficult problem for governments to solve. Consider a company that has a head office in the US and factories in Indonesia, selling to customers in Europe and the US. Where should the corporate profits be taxed? Without the customers, there is no profit. Without the factories, there is no profit. Without the head office directing the whole thing, there is no profit. Which governments are entitled to a share of that? If the Indonesian subsidiary is "selling" the goods to the European and US branches and turning a profit, and the head office is "selling" its management services to both and turning a profit, and the retail arms are making profits on sales to end customers, then there might be taxes to pay in each jurisdiciton. Now move the head office to a tax haven, and have the subsidiary units pay hefty IP licensing fees to the parent company - it seems that there are no taxable profits anywhere! This seems obviously bad, but the amount of work involved in crafting a set of rules which prevent this is hard. Either there is a global corporate tax rate such that this kind of profit-shifting no longer makes sense, or there is some system for distinguishing between illegitimate profit-shifting (to a tax haven) and legitimate profit-shifting (profits accumulating with the parent company in the US rather than in the subsidiaries). Of course, perhaps the latter isn't legitimate either! European governments worried about FANG companies would be no happier if FANG paid heavy corporate taxes in the US if they continued to pay very little corporate tax in Europe, for instance. So, I think government complaints about this are of the "this is too difficult for us to figure out and get international consensus on", so they resort to a kind of moral shaming, rather like the local priest shaming the town's wealthiest individuals for refusing to pay for repairs to the church roof.
- Roark66 5y agoBookmarked. For the time when Dutch politicians start lecturing other countries in EU about "solidarity" again. The most interesting part of the article for me is not that Uber dodged $6bln of taxes, but in which countries it decided not to dodge. USA and China. USA, probably because that's where this money goes, but China?
- pembrook 5y agoDoing anything the Chinese government doesn’t like is not advised, given it will soon be the most valuable consumer market in the world, and Uber has a multi-billion dollar stake in Didi Chuxing. You can play games with the European and American systems since their rules are slow to change and predictable. You cannot play games with China. They will kill your business and access to their market on a whim, and will send your Chinese employees and their families to labor camps (I’m not exaggerating, this has happened a lot). Hence why Apple is forced to look like a massive hypocrite whenever they talk about privacy, because they have no such protections for their users in China.
- amelius 5y agoThis is the definition of hacking: using a system (in this case the global financial system) in ways it was not intended to be used.
- lasagnaphil 5y ago'Hacking' kinda loses its novelty when almost every single large multinational corporation is doing it, though. How boring...
- amelius 5y agoThe equivalent of script kiddies.
- gdsdfe 5y agoI don't understand why it's taking ages to close these loopholes
- 88840-8855 5y agoProbably due to manifold opinions on those topics, a rather slow law creation system, lobbying forces, competing EU governments, prioritisation and corruption.
- whywhywhywhy 5y agoThe idea that companies and billionaires will ever pay taxes properly is absurd, when this is the amount of money you can save the resources you can use to save that become astronomical. Wish more people would realize this.
- jokoon 5y agoSurvival of the fittest at its finest. What's so amazing about those tax dodging stories, is how there are no protest about it. It's so complex that you get into arguments with market fundamentalist who will answer with economic theories, and the debate gets lost because of the low attention span of the audience. The problem is not capitalism, the problem is that it's rotten from the inside. Honestly, it seems the same thing happened to the Soviet Union. In my view it's quite concerning to hear people say communism is evil just by quoting the history of the soviet union, while dismissing both the political AND economic problems of capitalism.
- hmate9 5y agoHonestly it’s hard to blame companies for doing this. When all your competitors are doing it, you would be putting yourself at a distinct disadvantage by paying more taxes.
- pnt12 5y agoThat's a very convenient excuse by CEOs and board members, I don't buy the propaganda. Let's be critical here: if a big company has no or little adversaries, do they start paying more taxes? Of course not, everyone enjoys profit. So if the behavior does not change according to their adversaries, it's reasonable to say that this is just an excuse exploitative attitudes.
- sschueller 5y agoI don't see how this would stop if the US somehow gets a global min tax rate. The power to do something is in the US hands and doesn't require any foreign countries to change anything. These companies want to operate in the US. Just force them to pay what ever rate you find right irregardless what some islands tax rate might be. Huawei is blocked from operating in the US. Not because of taxes but they would pay whatever if they could get access to the market.
- NoblePublius 5y agoWho cares? The Federal government doesn’t need tax revenue to fund expenditures.
- MrPowers 5y ago> In 2019, Uber claimed $4.5 billion in global operating losses (excluding the US and China) for tax purposes – in reality, it brought in $5.8 billion in operating revenue This sentence makes me feel like the article author does not understand the difference between profit and revenue. The wording makes it seem like there is something nefarious about being a loss making company. Uber's global 2020 revenue was 11 billion, with a net income of -7 billion. > a manuever that grants the company a $1 billion tax break every year for the next 20 years, the researchers found I just have no idea how any researcher would be able to compute this. Corporate taxes are based on profits. In order to pay taxes, a corporation must actually make money. Did the researchers forecast a 20 year P&L and compute lost tax revenue based on their hypothetical financials?
- horsawlarway 5y agoSure, but tax breaks themselves are often fixed. Buying stock options is a great example of where you might end up with a fixed tax break. Buy 1000 options at your strike price ex: $1, pay tax on their current estimated value (say the value is estimated at $100, you pay tax on (100 - 1) * 1000 = $99,000 of "value" that you gained, probably about 20k). 2 years later: Boom, company goes out of business. That stock valued at 99k was actually worth 0k, but you paid taxes on 99k. So now you can write off approximately $3,500 (for this case) in taxes every year until you've written off that 20k you paid in taxes - about 6 years in this case. Has absolutely zilch to do with how much your P&L are. Those will still influence your final tax bill, of course, but they don't touch the break. --- Now - this case is not "avoidance" since you've paid the tax and are getting it back, but there are a lot of similar breaks related to loans, and the interest you're paying on loans - especially if the thing you're using that loan for is also taxed. So it's VERY possible that Uber has generated a $1 billion tax break every year through loan shenanigans. That doesn't mean that they won't pay taxes, it just means the yearly bill will be 1 billion lower than it probably ought to have been.
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- thrwhizzle 5y agoBusiness and corporate taxes are an endless exercise in futility. We need to just completely get rid of them. Businesses and corporations will never pay, and there is no magical sequence of words to formulate a bulletproof tax scheme. If we get rid of business and corporate taxes we can also get rid of special rates for capital gains, and treat all income the same. Then if you really want to get crazy, get rid of all the deductions and credits. But you’ll have to fight off all the special interests on both sides of the aisle.
- urza 5y agoKudos to Uber.
- joelbondurant 5y agoTaxes are theft.