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Robbery of the Century - Tax Evasion and Avoidance

Robbery of the Century - Tax Evasion and Avoidance

(4:10) How can companies like Google, Amazon or Colgate get away with paying little or no taxes? Trailer for this exposé on a global scam which politicians seem helpless to counter. Full documentary (in French and without subtitles): youtu.be/JdX9Fcj_Kzs

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cengland0 cengland0 (1376 days ago)

Google is not avoiding taxes. If profits are made in another country and those profits stay in that country, then they pay the tax rate established in that country.

Google is in business to make money for their shareholders. So, if they intend to bring any of those profits back into the USA, they will then pay USA taxes at that time. Even if they plan on buying stock back, they will pay USA taxes. So basically this tax is just deferred but they will pay it once they realize those profits for their shareholders.

To avoid double taxations, they will pay the higher USA taxes minus any taxes already paid to the other countries. If those tax amounts to other countries are low, then they will pay more USA taxes. So really they are not getting away with anything.

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Original comment

Google is not avoiding taxes. If profits are made in another country and those profits stay in that country, then they pay the tax rate established in that country.

Google is in business to make money for their shareholders. So, if they intend to bring any of those profits back into the USA, they will then pay USA taxes at that time. Even if they plan on buying stock back, they will pay USA taxes. So basically this tax is just deferred but they will pay it once they realize those profits for their shareholders.

To avoid double taxations, they will pay the higher USA taxes minus any taxes already paid to the other countries. If those tax amounts to other countries are low, then they will pay more USA taxes. So really they are not getting away with anything.

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WalterEgo WalterEgo (1375 days ago)

"If profits are made in another country and those profits stay in that country, then they pay the tax rate established in that country" Not sure about Google, but how did Apple make $30 billion profit over 4 years in Ireland, therefore paying almost zero % tax on that $30 billion? LINK

Or when Amazon sold me (in London) a Dell monitor via their website (amazon.co.uk), my bank told me the sale was from Luxemburg?

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"If profits are made in another country and those profits stay in that country, then they pay the tax rate established in that country" Not sure about Google, but how did Apple make $30 billion profit over 4 years in Ireland, therefore paying almost zero % tax on that $30 billion? LINK

Or when Amazon sold me (in London) a Dell monitor via their website (amazon.co.uk), my bank told me the sale was from Luxemburg?

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cengland0 cengland0 (1375 days ago)
Latest comment:

They are wrong about these accusations. Regarding the link you posted, within that same page you will see my comment to this. Apple paid 30% on their profits and I provided a link to backup the claim. Apple paid more taxes than any other company in the USA.

Regarding Amazon selling you something and it coming from Luxemburg, I don't have a problem with that. I buy things from Amazon all the time and I live in Florida but the sale is made in Texas. So what?!?!? Amazon, by the way, has products sold by 3rd party companies. Was your product sold and fulfilled by Amazon? If it was sold by Amazon, it could still have been drop shipped directly from the distributor instead of an Amazon warehouse. Amazon does not stock every product they sell on their website.

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Latest comment:

They are wrong about these accusations. Regarding the link you posted, within that same page you will see my comment to this. Apple paid 30% on their profits and I provided a link to backup the claim. Apple paid more taxes than any other company in the USA.

Regarding Amazon selling you something and it coming from Luxemburg, I don't have a problem with that. I buy things from Amazon all the time and I live in Florida but the sale is made in Texas. So what?!?!? Amazon, by the way, has products sold by 3rd party companies. Was your product sold and fulfilled by Amazon? If it was sold by Amazon, it could still have been drop shipped directly from the distributor instead of an Amazon warehouse. Amazon does not stock every product they sell on their website.

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Guest: Taicoon (1376 days ago)

" If profits are made in another country and those profits stay in that country, then they pay the tax rate established in that country."

That sounds good, but the reality of it is that profits may be made in a country but then the large coorporation will move a surplus from a high tax country to a low tax country through book keeping. Suddenly the branches in the high tax country will "pay" the branches in low tax countries for various services and at a cost which may be very much higher than what would otherwise make sense.

Viola! The branch in the high tax country has no longer any surplus.

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Original comment

" If profits are made in another country and those profits stay in that country, then they pay the tax rate established in that country."

That sounds good, but the reality of it is that profits may be made in a country but then the large coorporation will move a surplus from a high tax country to a low tax country through book keeping. Suddenly the branches in the high tax country will "pay" the branches in low tax countries for various services and at a cost which may be very much higher than what would otherwise make sense.

Viola! The branch in the high tax country has no longer any surplus.

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cengland0 cengland0 (1376 days ago)

Then the branches in the low tax country made an extreme profit because they charged too much. Those branches will pay more taxes. One way or another, the companies end up paying their fair share of taxes once those profits are given to the shareholders (company is in business to do).

These are well known hoaxes floating around the internet and if people would just look at the profit and loss statements of the companies, you will see they do pay taxes.

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Original comment

Then the branches in the low tax country made an extreme profit because they charged too much. Those branches will pay more taxes. One way or another, the companies end up paying their fair share of taxes once those profits are given to the shareholders (company is in business to do).

These are well known hoaxes floating around the internet and if people would just look at the profit and loss statements of the companies, you will see they do pay taxes.

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Guest: JoeTaicoon (1375 days ago)

"Then the branches in the low tax country made an extreme profit because they charged too much. Those branches will pay more taxes. "

That statement seems to be against better knowledge. Obviously if you make 1000 monetary units in profit and split tax as

900*0.1+100*0.3 you get a lower tax payment than by 500*0.1+500*0.3
which is why you would move profits from high rax regions to low tax regions.

Then there is the issue of shareholders taking home profit. First of all, you can spend quite a while investing and reinvesting without taking out personal profits. Secondly, when you finally do take out your profit, it can now be such a larve value that you can easily enough afford good counseling helping you place it in hiding... or alternatively you could spend some of the surplus on your personal politician, which is tax deductable ;-)


Obviosuly they do tend to pay tax, just not their fair share.
Denmark is a high tax country and strangely enough all the major coorporations, operating here, have very small or zero earnings. In fact they are moving most of that income to Ireland which has very low tax rates for businesses.

ReplyVote up (102)down (118)
Original comment

"Then the branches in the low tax country made an extreme profit because they charged too much. Those branches will pay more taxes. "

That statement seems to be against better knowledge. Obviously if you make 1000 monetary units in profit and split tax as

900*0.1+100*0.3 you get a lower tax payment than by 500*0.1+500*0.3
which is why you would move profits from high rax regions to low tax regions.

Then there is the issue of shareholders taking home profit. First of all, you can spend quite a while investing and reinvesting without taking out personal profits. Secondly, when you finally do take out your profit, it can now be such a larve value that you can easily enough afford good counseling helping you place it in hiding... or alternatively you could spend some of the surplus on your personal politician, which is tax deductable ;-)


Obviosuly they do tend to pay tax, just not their fair share.
Denmark is a high tax country and strangely enough all the major coorporations, operating here, have very small or zero earnings. In fact they are moving most of that income to Ireland which has very low tax rates for businesses.

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cengland0 cengland0 (1375 days ago)

Your formula is wrong. It should be more like this:

1000 - (1000 *.1) = 900. Gross profit from low tax country.

900 - (900 * .3) = 630. Net profit after transferring remaining money back to the USA to distribute to shareholders for dividends.

If the company decides to invest in more infrastructures, then that ends up on the expense side of the profit/loss statement but not all at once. If you buy a building or heavy equipment, you are allowed to deduct a portion of it for IRS specific time periods. This is what they call depreciation. Each category of deductions for equipment has a different amortization schedule. The building (minus the price of the non-deductable land) is depreciated at about 2.5% for 39 years on Form 4562.

ReplyVote up (125)down (116)
Original comment

Your formula is wrong. It should be more like this:

1000 - (1000 *.1) = 900. Gross profit from low tax country.

900 - (900 * .3) = 630. Net profit after transferring remaining money back to the USA to distribute to shareholders for dividends.

If the company decides to invest in more infrastructures, then that ends up on the expense side of the profit/loss statement but not all at once. If you buy a building or heavy equipment, you are allowed to deduct a portion of it for IRS specific time periods. This is what they call depreciation. Each category of deductions for equipment has a different amortization schedule. The building (minus the price of the non-deductable land) is depreciated at about 2.5% for 39 years on Form 4562.

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