Uber used 50 Dutch shell companies to dodge taxes on $6B in revenue

Congress is corrupt (via lobbyists). Congress would make this illegal if congress men&#x2F;women didn&#x27;t sell out American Citizens.<p>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&#x2F;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.

&gt; 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.<p>Shit like this makes my head hurt and infuriates me at the same time.

If IP and shell companies infuriate you. I invite you to investigate why all billionaires have foundations or its cousin structures and &quot;give&quot; their wealth to it... Clue: tax and inheritance (tax) avoidance. Bill, Buffett, etc. are hypocrites.<p>But it is not new, even in the Bible they spoke about it (Matthew 6:2): &quot;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.&quot;

&gt; 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<p>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.<p>Uber&#x27;s global 2020 revenue was 11 billion, with a net income of -7 billion.<p>&gt; a manuever that grants the company a $1 billion tax break every year for the next 20 years, the researchers found<p>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&amp;L and compute lost tax revenue based on their hypothetical financials?

I&#x27;ve heard this suggested before: abolish all corporate tax and increase capital gains tax to equal income tax.<p>This will level the playing field between large and small businesses, since the former has the means to dodge byzantine corporate tax laws.<p>It will also give an incentive for companies to stay onshore.<p>Any downsides?

In my opinion, this is example of poor&#x2F;incomplete regulation. Using sports as an analogy, it&#x27;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.

&gt; 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.<p>But... It&#x27;s legal... None of it is illegal... They are compliant with the law... It&#x27;s the law and the government&#x27;s that need to change... Or am I missing something here?

It’s crazy that we’re at the point of such massive globalization that sophisticated companies can literally play different business&#x2F;tax laws of countries off of each other

I don&#x27;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&#x27;t that the big criticism of Uber&#x27;s business model -- that they can&#x27;t turn a profit at rates people are willing to pay while also compensating drivers?

Individuals are subjected to &quot;alternative minimum tax&quot;. Why not corporations?

I find tax avoidance stories&#x2F;headlines that focus on revenue numbers (which aren’t taxed), vs profits (which are), grating.<p>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.<p>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…

you mean the company that dodges regulations 3verywhere is dodging taxes everywhere?

I 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&#x27;t pay their fair share.

Large multinational Corp takes advantage of legal tax loopholes. Nothing new here.

The only way to stop this, is to create income (eg. 1-2%) based tax regulations instead of profit based. No way to cheat.

Honestly 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.

This is the definition of hacking: using a system (in this case the global financial system) in ways it was not intended to be used.

Bookmarked. For the time when Dutch politicians start lecturing other countries in EU about &quot;solidarity&quot; again.<p>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&#x27;s where this money goes, but China?

Note: Dutch shell != Dutch Shell <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Royal_Dutch_Shell" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Royal_Dutch_Shell</a>

I don&#x27;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&#x27;t require any foreign countries to change anything.<p>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.<p>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.

Lol of course Uber did it. If not them then whom?

Companies pay taxes on profits not on revenue. This is meaningless outragebait.

The 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.<p>Wish more people would realize this.

Honest question: Who here will stop using Uber because of this? Anyone?

It&#x27;s nuts to me that our government lets this happen, yet strives to vilify the upper middle class as the &quot;billionaire class&quot; and tax the shit out of them.

Not to be confused with Royal Dutch Shell company!

Who cares? The Federal government doesn’t need tax revenue to fund expenditures.

Really, 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.

And they also fired 200 Dutch people from their Amsterdam office.<p>Way to show gratitude, Uber.

I don&#x27;t understand why it&#x27;s taking ages to close these loopholes

There 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.

Survival of the fittest at its finest.<p>What&#x27;s so amazing about those tax dodging stories, is how there are no protest about it. It&#x27;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.<p>The problem is not capitalism, the problem is that it&#x27;s rotten from the inside. Honestly, it seems the same thing happened to the Soviet Union. In my view it&#x27;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.

there are no longer any effective checks and balances against corporate power.

More proof that we don&#x27;t need to increase taxes. We just need to enforce our existing taxes better.

Kudos to Uber.

Business 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.<p>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.<p>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.

Please deflame the headline. Tax avoidance is not tax dodging.

This should be stamped out and severely penalised. I&#x27;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&#x27;t be able to compete because from the start you&#x27;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.

Instead 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&#x27;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.