When the facts change, I change my mind. What do you do? -- John Maynard Keynes

Tuesday, March 26, 2013

Why Don't Corporations Pay Taxes Like The Rest of Us?

The US does not have a progressive tax system--it is egregiously regressive--another reason we need comprehensive tax reform before we start cutting programs:

Corporations Don't Pay Taxes, Why Should You? | The Nation: " . . . . The most skilled at this con game are the health care and technology companies, which, as a Senate investigation last year revealed, have become quite expert at shifting marketing rights and patents offshore to low-tax countries. Microsoft boosted its foreign holdings by $16 billion last year, and by the end of the company’s fiscal year on June 30, 2012, had $60.8 billion stashed internationally. Through creative accounting, Microsoft was able to claim that only 7 percent of its pretax profit last year was domestically generated. Oracle increased its foreign holdings by one-third, including new subsidiaries in low-tax Ireland, and thereby was able to add a cool $272 million to the company’s bottom line by avoiding US taxes. Abbott estimates that it saved $1.6 billion in US taxes through its operations in more than a dozen countries. By moving $8.1 billion of its profits overseas, Abbott was able to claim a pretax loss on its US operations. Johnson & Johnson, another health industry giant, has almost all of its cash—$14.8 billion out of $14.9 billion—abroad, yet still claims to be a US company. One of the longtime leaders in offshore tax avoidance has been that once-American-as-apple-pie company GE, which in a more innocent time hired Ronald Reagan to advertise its wares. Now GE has nearly two-thirds of its jobs abroad, avoided US taxes in the previous two years and has $108 billion stashed overseas. Two years ago, President Obama appointed GE CEO Jeffrey Immelt to chair his Jobs Council, despite the fact that Immelt had cut his company’s US workforce by a fifth. GE’s expertise is no longer in appliance manufacturing, a division Immelt has tried to shed, but rather in financial manipulation. GE Capital was a leader in the financial scams that still haunt the US economy, and Immelt has been most effective in lobbying Washington politicians to rig the tax laws to benefit his and other multinational corporations. He has created some jobs, but unfortunately, they are abroad, along with his company’s untaxed profits. For all these multinational corporations, the love of profit trumps loyalty to country. . . " (read more at link above)


The Big Picture

Financial Crisis - The Telegraph

JohnTheCrowd.com | The Sailing Website

Craig Newmark - craigconnects