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The issue isn't about lower tax rates, or moving to lower tax jurisdictions - these major companies don't pay anywhere near the relatively low Irish corporate t

The issue isn't about lower tax rates, or moving to lower tax jurisdictions - these major companies don't pay anywhere near the relatively low Irish corporate tax rate of 12.5%. It's about closing tax loopholes, which are separate from the tax rate. For example, Google paid just 2.4% tax a few years back, here's an excellent older article from Bloomberg on the subject: 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... Corporations sitting on multi-billion dollar cash piles, while many western governments are struggling with deficits isn't sustainable, so plugging these loopholes is likely to continue.

lettergram 12y ago
Actually, the governments are struggling with deficits because they spend more than they make. I'm not claiming companies shouldn't pay the proper tax, but that 2.4% tax also includes donations, employing people (which also provide tax) and what not which they can write off. What really needs to happen, is that governments stop spending more than they make. Sure they can increase taxes, but they will also try to increase spending (defeating the purpose).
- ewoodrich 12y ago
  >What really needs to happen, is that governments stop spending more than they make And closing loopholes to increase revenue is one way to accomplish that. You can't state with certainty that governments will necessarily increase spending proportionally -- just look at "austerity" measures.
  - nitrogen 12y ago
    Has anyone provided numbers on the percentage of deficits that would be covered by closing loopholes, and the following effects on the global economy?
- logfromblammo 12y ago
  That is true in the modal case. Governments don't necessarily get into trouble by spending more than they have. If they spend only on goods and services that tend to promote sustainable economic growth, the rise in future revenues will more than compensate for that. If you borrow 1000 kg of seed corn and then plant it on fertile land, you can pay back that ton with interest. If you borrow 1000 kg of seed corn, distill it into whiskey, then drink some and burn the rest, you will probably have some trouble with debt later. If governments spent only on those things that provided more value to their taxpayers than simply holding on to their cash, people would actually be clamoring to pay more in taxes. But the principal-agent problem usually makes that impossible. People that spend other people's money have little incentive to do it prudently.

lettergram 12y ago

Actually, the governments are struggling with deficits because they spend more than they make. I'm not claiming companies shouldn't pay the proper tax, but that 2.4% tax also includes donations, employing people (which also provide tax) and what not which they can write off. What really needs to happen, is that governments stop spending more than they make. Sure they can increase taxes, but they will also try to increase spending (defeating the purpose).

ewoodrich 12y ago
>What really needs to happen, is that governments stop spending more than they make And closing loopholes to increase revenue is one way to accomplish that. You can't state with certainty that governments will necessarily increase spending proportionally -- just look at "austerity" measures.
- nitrogen 12y ago
  Has anyone provided numbers on the percentage of deficits that would be covered by closing loopholes, and the following effects on the global economy?
logfromblammo 12y ago
That is true in the modal case. Governments don't necessarily get into trouble by spending more than they have. If they spend only on goods and services that tend to promote sustainable economic growth, the rise in future revenues will more than compensate for that. If you borrow 1000 kg of seed corn and then plant it on fertile land, you can pay back that ton with interest. If you borrow 1000 kg of seed corn, distill it into whiskey, then drink some and burn the rest, you will probably have some trouble with debt later. If governments spent only on those things that provided more value to their taxpayers than simply holding on to their cash, people would actually be clamoring to pay more in taxes. But the principal-agent problem usually makes that impossible. People that spend other people's money have little incentive to do it prudently.