4 ms·

The idea that it is possible for those that earn vast quantities of money more than your "standard joe" to pay _less_ tax on that considerably larger cash pile.

The idea that it is possible for those that earn vast quantities of money more than your "standard joe" to pay _less_ tax on that considerably larger cash pile. The line about lobbying for a new corporate exemption on "repatriating" cash from either tax havens or anywhere else abroad at the pitiful tax rate of 5.75% compared to the base 10% that someone that works at a diner has to pay illustrates the issue rather well.

waterlesscloud 15y ago
A lower rate of tax, not less tax.
yummyfajitas 15y ago
If a non-US citizen works at a diner in a tax haven or anywhere else abroad, and brings money into the US, they typically pay 0% tax (to the US) on that money. This is the analogous situation to non-US corporations (possibly owned by US corps) leaving profits overseas.
- wisty 15y ago
  But typically, they are working there, not setting up a virtual office. If these super rich are working in the US, they should pay tax. If they are not working, why don't they deserve to be taxed?
  - yummyfajitas 15y ago
    The super rich working in the US do pay tax on their income. You seem to be conflating many separate issues, so let me explain in detail how it works. Sergei Brin pays taxes on his income to the US. Google Ireland doesn't pay taxes to the US on income earned in Ireland until they transfer the money to the US. (They do, however, pay taxes to Ireland.) A guy working at a diner in Ireland will, as far as I know, never pay taxes even if he does transfer money to the US.
    - dharma1 15y ago
      Google UK also pays most of it taxes to Ireland, despite the revenue being from the UK. Wonder if that has anything to do with Ireland having lower taxes? http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-sho... They call it "transfer pricing" but really it's tax avoidance, and should be illegal.
radog 15y ago
This is cash that was taxed once in the foreign jurisdiction at whatever prevailing rate was in effect there. With the exception of the US, nearly all developed countries have territorial tax systems at which the rate on those foreign profits would be 0%. A repatriation holiday would be a huge (and poorly targeted, considering nearly the entire benefit inures to about 10-20 firms) giveaway, but it's only discussed in the first place because of our strange worldwide corporate tax system.

waterlesscloud 15y ago

A lower rate of tax, not less tax.

yummyfajitas 15y ago

If a non-US citizen works at a diner in a tax haven or anywhere else abroad, and brings money into the US, they typically pay 0% tax (to the US) on that money. This is the analogous situation to non-US corporations (possibly owned by US corps) leaving profits overseas.

wisty 15y ago
But typically, they are working there, not setting up a virtual office. If these super rich are working in the US, they should pay tax. If they are not working, why don't they deserve to be taxed?
- yummyfajitas 15y ago
  The super rich working in the US do pay tax on their income. You seem to be conflating many separate issues, so let me explain in detail how it works. Sergei Brin pays taxes on his income to the US. Google Ireland doesn't pay taxes to the US on income earned in Ireland until they transfer the money to the US. (They do, however, pay taxes to Ireland.) A guy working at a diner in Ireland will, as far as I know, never pay taxes even if he does transfer money to the US.
  - dharma1 15y ago
    Google UK also pays most of it taxes to Ireland, despite the revenue being from the UK. Wonder if that has anything to do with Ireland having lower taxes? http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-sho... They call it "transfer pricing" but really it's tax avoidance, and should be illegal.

radog 15y ago

This is cash that was taxed once in the foreign jurisdiction at whatever prevailing rate was in effect there. With the exception of the US, nearly all developed countries have territorial tax systems at which the rate on those foreign profits would be 0%. A repatriation holiday would be a huge (and poorly targeted, considering nearly the entire benefit inures to about 10-20 firms) giveaway, but it's only discussed in the first place because of our strange worldwide corporate tax system.