And this is where the main issue is. Local newspapers, local advertising companies, global search companies that could have been; all of them are competing with Google on vastly unfair terms. Google is not paying tax. The others have to.
Large companies should be taxed where the value is created. And because that’s hard to measure, cost should be used instead. So if Google spends 60% of its budget in the US, 60% of its profits should also be attributed to the US.<p>(Side note: the alternative of taxing profits where the revenue is generated does not make much sense as this would be equivalent to a sales tax.)
Technically the FAANG profits are somewhat reflected in the stock price. With their 20-50% in annual gains, holding stock in some of these allows you and retirees and other US stockholders to partake in the gains. The stock growth then rewards tax shifters vs non-tax shifters. This is essentially a wealth shift from tax global tax revenue that gets distributed by politics to global shareholders who are able and aware enough to invest in US fast-growing corporates (while possibly bubbling stock prices a bit).
Question: why isn’t there an international entity that is to tax-law normalization as WIPO is to IP-law normalization, that could—like WIPO—punish offending non-members by requiring members to impose trade sanctions on them?<p>The big players (none of which are tax havens) certainly would have an interest in building it, and in giving it power.
Yes, foreign direct investment is a poor measure in many regards and using foreign affiliates statistics instead seems very helpful. But referencing controversial Piketty doesn't help in advocating for their policy suggestions.<p>I would have liked to see an exploration of how high-tax countries encourage those differences in "Pre-tax corporate profits (% of compensation of employees)" and how the taxing of individuals has changed in the same time.<p>Germany for example has a progressive income tax capped at 42% yet while incomes rose over the decades, the tax exemption limits did not, effectively reducing the salary needed to reach that cap from 24-times-the-mean-wage two 2-times-the-mean-wage.
Maybe this is a silly question, but why don't we just lower the corporate tax rate significantly (maybe 10 or 15%), and make the use of tax havens illegal?<p>I'll bet 10% of $17bil is still quite a bit more than whatever Google paid in US taxes that same year. Is it because "making the use of tax havens illegal" is hard/impossible?
It seems that multinational uses price transfer to move profits from high tax country to low tax country. Would it make sense to tax trademarks, patents, goodwill from abroad to reduce this abuse?
Editorializing titles like this is against HN's guidelines (<a href="https://news.ycombinator.com/newsguidelines.html" rel="nofollow">https://news.ycombinator.com/newsguidelines.html</a>). When accounts do this, they eventually lose submission privileges. If you'd read the guidelines and follow them when posting here, we'd appreciate it.<p>(Submitted title was 'Don't be taxpayer – Google Alphabet made $19.2B in revenue in Bermuda'.)
This is disgusting. Literally stealing from the pockets of the american people. It doesnt matter that its technically legal. This news should bring outrage.