Share This

Google App Engine

Powered by Google App Engine

AddToAny.com/share_save

Share

share gadget

http://fcgadgets.appspot.com/spec/sharefb.xml

Facebook Badge

Loke San | Create Your Badge

PLUGINS FACEBOOK

FACEBOOK SOCIAL PLUGINS

My Blog List

ADDED TWITTER

Total Pageviews

Sunday, December 2, 2012

Fiscal Cliff 2013: How Apple and Google Can Save Us

Fiscal Cliff 2013: How Apple and Google Can Save Us
Posted by at

1 comment:

  1. RAYLOKEDecember 2, 2012 at 4:45 PM


    We may not be facing such a steep fall over the edge of the fiscal cliff, or have to compromise so heavily on individual taxes or government programs, if corporations actually paid what they owe in taxes.

    Congress is locked in a bitter partisan standoff about where to cut the budget to avoid the automatic cuts that will take effect at the end of 2012 — whether to raise the debt ceiling, whose taxes to raise and by how much, which government programs to slash. Meanwhile, tens of billions of dollars of revenue that could and should be going toward reducing the federal deficit and keeping the budget afloat are being hoarded offshore, according to a Senate subcommittee report released on Thursday.

    “From 2009 to 2011, by transferring rights to its intellectual property to a Puerto Rican subsidiary,” the subcommittee found, “Microsoft was able to shift offshore nearly $21 billion, or almost half of its U.S. retail sales net revenue, saving up to $4.5 billion in taxes on goods sold in the United States, or just over $4 million in U.S. taxes each day.” $4 million each day!

    The report zeroed in on the shady practices of Microsoft, Apple, Google and Hewlett-Packard, but most multinational companies pay well below the mandated 35% — an average of just 9%, according to financial research company NerdWallet.

    In 1952, the corporate tax generated 32.1% of all federal tax revenue and individual tax 42.2%. Individual tax has remained nearly the same, accounting for 41.5% today, while corporate tax has dropped to a meager 8.9%. The subcommittee report attributes this drop largely to the tax loopholes and offshore shelters.

    “Reforms are needed to eliminate tax loopholes and tighten tax provisions that encourage U.S. multinationals to transfer and keep intellectual property and profits offshore,” the report reads. Among such reforms suggested are changes to particular sections of the tax code regarding transfer pricing and offshore loan practices, and stricter penalties for abuses.

    The U.S.’s 35% corporate tax rate is one of the highest in the world, and it’s no surprise that corporations try to find ways to avoid taxes and increase profits by doing so. But it’s the government’s responsibility to stay ahead them, close loopholes and impose prohibitive penalties. Doing so should be a major focus of fiscal cliff talks, if Republicans don’t want to raise taxes and Democrats don’t want to cut Social Security or Medicaid.

    ReplyDelete

Subscribe to: Post Comments (Atom)