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(Huffington Post)   New study explains that corporations have been feeding us lies. In this case, about inversions   (huffingtonpost.com) divider line 98
    More: Obvious, Joint Committee on Taxation, tax analysts, Andrew Ross Sorkin, Citizens for Tax Justice, Government of Ireland, Scrooge McDuck, tax bills, IRC  
•       •       •

4948 clicks; posted to Politics » on 20 Aug 2014 at 1:57 PM (35 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2014-08-20 10:53:28 AM  
I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?
 
2014-08-20 11:58:58 AM  

Destructor: I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?


At the beginning of TFA I thought they were going to argue that there are so many loopholes in the US tax code that inversions don't actually save them any money, but then there's this:

"Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."
 
2014-08-20 12:31:14 PM  
I thought TFA was going to be about those inversion therapy hanging things you see on the TV, and was confused wtf that had to do with politics.
 
2014-08-20 01:19:51 PM  

Arkanaut: "Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."


Exactly. That's sort of the exact opposite of "debunking"... More like "confirming".

Oh well, that's the way it is with the Huffington Post (and other news outlets). Sometimes a few bad headlines wriggle through.

On the other hand, the article wasn't that horrible. Just nothing really new.
 
2014-08-20 02:03:01 PM  

Arkanaut: Destructor: I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?

At the beginning of TFA I thought they were going to argue that there are so many loopholes in the US tax code that inversions don't actually save them any money, but then there's this:

"Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."


The point is that they could save money...if they weren't already with loopholes. At least, that's what I got out of it.
 
2014-08-20 02:03:52 PM  
His argument is that the companies crying "It's either invert or shut down due to oppressive U.S. taxes" are full of shiat.

He's not disputing that they save money, but that these companies are having their hands "forced".
 
2014-08-20 02:05:37 PM  

Arkanaut: Destructor: I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?

At the beginning of TFA I thought they were going to argue that there are so many loopholes in the US tax code that inversions don't actually save them any money, but then there's this:

"Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."


So, I guess the debunking is that the huge chunks of money are the difference between life and death. They're already paying a lower rate than almost all individuals, yet whining about how "unfair" the tax code in the US is. It's not about the tax code. It's about greed. The "tax burden" argument is PR to prevent yokels from avoiding inverted companies.
 
2014-08-20 02:11:01 PM  

Destructor: Arkanaut: "Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."

Exactly. That's sort of the exact opposite of "debunking"... More like "confirming".

Oh well, that's the way it is with the Huffington Post (and other news outlets). Sometimes a few bad headlines wriggle through.

On the other hand, the article wasn't that horrible. Just nothing really new.


On thing he should have pointed out is that inversion can cost companies lucrative US government contracts. It seems to be a major reason CVS backed out.
 
2014-08-20 02:12:46 PM  
Last weeks NPR story about Walgreens not inverting had more interesting info than this story.
 
2014-08-20 02:13:40 PM  
I think the issue that yes a company that operates 90% in the USA,  isn't going to go bankrupt because of the Tax Code,

But if that company merges with another company and all of a sudden their revenue from out of country jumps then they are at a disadvantage if they stay incorporated in the USA potentially, thus requiring an inversion, that's the way I understand it.
 
2014-08-20 02:25:14 PM  

tricycleracer: His argument is that the companies crying "It's either invert or shut down due to oppressive U.S. taxes" are full of shiat.

He's not disputing that they save money, but that these companies are having their hands "forced".


That's kinda how it works.  "We can save x by doing Y."  "OK, what are my alternatives to x?"

If you don't have an alternative that saves as much money, you are forced to do the thing that does.  Or to not save money.

But that's right out, too, since they are forced to act by the shareholder-oriented, maximizing profits at any cost mentality.

If you can save money, you must save money.  If you can only save money by cheating, you must cheat.
 
2014-08-20 02:25:36 PM  

bglove25: So, I guess the debunking is that the huge chunks of money are the difference between life and death. They're already paying a lower rate than almost all individuals, yet whining about how "unfair" the tax code in the US is. It's not about the tax code. It's about greed. The "tax burden" argument is PR to prevent yokels from avoiding inverted companies.



Exactly.  There are plenty of successful companies that keep their HQ and pay their taxes right here in the USA.  The only reasons a company would "have" to invert would be because they're either 1) greedy or 2) not very good at their business.
 
2014-08-20 02:25:58 PM  
"What are my alternatives to y?"

Even.
 
2014-08-20 02:28:15 PM  

bglove25: Arkanaut: Destructor: I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?

At the beginning of TFA I thought they were going to argue that there are so many loopholes in the US tax code that inversions don't actually save them any money, but then there's this:

"Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."

So, I guess the debunking is that the huge chunks of money are the difference between life and death. They're already paying a lower rate than almost all individuals, yet whining about how "unfair" the tax code in the US is. It's not about the tax code. It's about greed. The "tax burden" argument is PR to prevent yokels from avoiding inverted companies.


I'm all for scrapping the horribly burdensome corporate income tax. We'll replace it with a transactional tax on every item sold in the USA. No, not a sales tax paid at the register, when it's sold to the retailer. Don't pay it? Your products don't go on shelves. Services get the same tax to be fair. There are no exemptions, refunds, et al. (Not for profit rules apply to the buyer only)

Suck it up buttercup, that office in Dubai isn't so useful now.
 
2014-08-20 02:32:08 PM  
This is why we need government regulations.

"In order to maximize profits, we must sacrifice small children in a volcano nightly."

"Well, that doesn't seem very ethical.  Or legal."

"Legal already cleared it.  There is a loophole that allows a certain number of sacrifices for children under a certain weight."

"Ah, excellent."

*stock prices go up on news of baby-murdering initiative*

Versus

"In order to maximize profits, we must sacrifice small children in a volcano nightly."

"Hi, I'm the government, and you can't kill children. At all."

"OK, well, we tried.  Our obligations are met.  Let's go get drunk."

*stock prices unchanged*
 
2014-08-20 02:32:43 PM  

sendtodave: If you can save money, you must save money.  If you can only save money by cheating, you must cheat.


I could "maximize shareholder value" by murdering a rival CEO.

shiat, I shouldn't give Wall Street any ideas.
 
2014-08-20 02:34:00 PM  
Each one of these inversions cost a corporation hundreds of thousands of dollars in legal and accounting fees.  There's no way these are anything other than huge money winners.
 
2014-08-20 02:36:32 PM  
You know, if the tax code is so oppressive they can't make any profits here, they should probably invest in some bootstraps and work harder to earn more profits.

If they don't have any capital to invest, they should just borrow some from their parent company.
 
2014-08-20 02:41:22 PM  

Troy McClure: Each one of these inversions cost a corporation hundreds of thousands of dollars in legal and accounting fees.  There's no way these are anything other than huge money winners.


... for the consultants and legal experts who recommended the inversions.
 
2014-08-20 02:41:41 PM  

palelizard: You know, if the tax code is so oppressive they can't make any profits here, they should probably invest in some bootstraps and work harder to earn more profits.

If they don't have any capital to invest, they should just borrow some from their parent company.


I like you.
 
2014-08-20 02:43:22 PM  

draypresct: Troy McClure: Each one of these inversions cost a corporation hundreds of thousands of dollars in legal and accounting fees.  There's no way these are anything other than huge money winners.

... for the consultants and legal experts who recommended the inversions.


demotivators.despair.com
 
2014-08-20 02:46:42 PM  

inglixthemad: bglove25: Arkanaut: Destructor: I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?

At the beginning of TFA I thought they were going to argue that there are so many loopholes in the US tax code that inversions don't actually save them any money, but then there's this:

"Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."

So, I guess the debunking is that the huge chunks of money are the difference between life and death. They're already paying a lower rate than almost all individuals, yet whining about how "unfair" the tax code in the US is. It's not about the tax code. It's about greed. The "tax burden" argument is PR to prevent yokels from avoiding inverted companies.

I'm all for scrapping the horribly burdensome corporate income tax. We'll replace it with a transactional tax on every item sold in the USA. No, not a sales tax paid at the register, when it's sold to the retailer. Don't pay it? Your products don't go on shelves. Services get the same tax to be fair. There are no exemptions, refunds, et al. (Not for profit rules apply to the buyer only)

Suck it up buttercup, that office in Dubai isn't so useful now.


Those taxes would apply to foreign companies who sold goods in the us as well, right? If so, sign me up for your newsletter. Consumption taxes are more efficient and fair and stable than other types of taxes.
 
2014-08-20 02:48:34 PM  

Matrix Flavored Wasabi: Arkanaut: Destructor: I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?

At the beginning of TFA I thought they were going to argue that there are so many loopholes in the US tax code that inversions don't actually save them any money, but then there's this:

"Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."

The point is that they could save money...if they weren't already with loopholes. At least, that's what I got out of it.


Yeah pretty much this. If corporate taxes were really as low as HuffPo would have you think, then these inversions would be pointless.
 
2014-08-20 02:48:36 PM  
tricycleracer:

I could "maximize shareholder value" by murdering a rival CEO.

shiat, I shouldn't give Wall Street any ideas.


It's been done already:

venturebeat.files.wordpress.com
 
2014-08-20 02:49:12 PM  
tl;dr : "Companies will lie about things to make more money."
 
2014-08-20 02:50:19 PM  

tricycleracer: sendtodave: If you can save money, you must save money.  If you can only save money by cheating, you must cheat.

I could "maximize shareholder value" by murdering a rival CEO.

shiat, I shouldn't give Wall Street any ideas.


Lo, and on that great day Wednesday, the 20th of August in the year two thousand fourteen, one rich man said to a second rich man, "You know, we could eat him too" and pointed to a third rich man.  And there was much rejoicing.

I'm all for this idea.  Make it legal, the killer gets the dead guy's golden parachute, but it has to be done with their own hands (tools are okay, like guns, they just can't hire anyone to do it for them).  Let 'em earn that 3500% of the median worker's salary.
 
2014-08-20 02:50:57 PM  
 
2014-08-20 02:53:04 PM  

tricycleracer: I could "maximize shareholder value" by murdering a rival CEO.


Oh, you couldn't murder *every* CEO...

www.smidgeindustriesltd.com
 
2014-08-20 02:54:30 PM  

bglove25: They're already paying a lower rate than almost all individuals, yet whining about how "unfair" the tax code in the US is.


The argument companies are making is that they're paying a higher percentage than their international competitors, although this argument also disregards the value-added tax that most Europe-based companies have to pay. I still doubt it's life or death though.
 
2014-08-20 02:55:11 PM  
Well, yeah. That Teeter Hangups dude never seemed legit.
 
2014-08-20 02:56:45 PM  

sendtodave: This is why we need government regulations.

"In order to maximize profits, we must sacrifice small children in a volcano nightly."

"Well, that doesn't seem very ethical.  Or legal."

"Legal already cleared it.  There is a loophole that allows a certain number of sacrifices for children under a certain weight."

"Ah, excellent."

*stock prices go up on news of baby-murdering initiative*

Versus

"In order to maximize profits, we must sacrifice small children in a volcano nightly."

"Hi, I'm the government, and you can't kill children. At all."

"OK, well, we tried.  Our obligations are met.  Let's go get drunk."

*stock prices unchanged*


"We set up the fake vendor like you said boss. 'Vulcan Recyclers' The first babies go in tonight."

"hehehehe good one Perkins. Now remember, at the first sign of the Feds, we exercise our stock options and cash out."

"What about a shareholder lawsuit?...."

".... BWAHAHAHA!!!"
 
2014-08-20 02:56:55 PM  

Paelian: tricycleracer:

I could "maximize shareholder value" by murdering a rival CEO.

shiat, I shouldn't give Wall Street any ideas.

It's been done already:

[venturebeat.files.wordpress.com image 800x1102]



I own that RPG set... maybe I should re-read it.
 
2014-08-20 03:04:56 PM  
What I got out of the article was the claim of a 35% tax rate being burdensome is flawed, since through deductions and loopholes most large corporations pay closer to 13-16% by the end of the day.

Or another way to think of it--if the top rate was 20% most corporations would pay 0%, after deductions and loopholes.

In reality businesses don't pay taxes.  Consumers do through higher prices.  An earlier poster said something about transactional taxes for every business, foreign or domestic, getting products and services to the end user/consumer.

Makes sense to me.  Everyone pays something like 5%, the tax rate is effectively lowered for those who are paying now, those who found a major loophole have to ante up, more money comes in the Treasury, and every business plays on the same level field.
 
2014-08-20 03:07:36 PM  
Why are our tax codes written with so many holes that you KNOW the politicians knew about when signing them.... let that sink in a while.  The corporations are just taking advantage of lawmakers mistakes.
 
2014-08-20 03:12:36 PM  

dwrash: Why are our tax codes written with so many holes that you KNOW the politicians knew about when signing them.... let that sink in a while.  The corporations are just taking advantage of lawmakers mistakes.


Mistakes? I think you underestimate lawmakers.
 
2014-08-20 03:13:51 PM  

inglixthemad: bglove25: Arkanaut: Destructor: I read the article... So, what exactly was debunked?

All I got out of it seems to be that this guy's version of "Fair" is somehow better than the corporation's version of "Fair". That's... nice?

At the beginning of TFA I thought they were going to argue that there are so many loopholes in the US tax code that inversions don't actually save them any money, but then there's this:

"Kleinbard doesn't dispute that U.S. companies can save Scrooge McDuck quantities of money by exploiting the inversion loophole, and repatriating overseas."

So, I guess the debunking is that the huge chunks of money are the difference between life and death. They're already paying a lower rate than almost all individuals, yet whining about how "unfair" the tax code in the US is. It's not about the tax code. It's about greed. The "tax burden" argument is PR to prevent yokels from avoiding inverted companies.

I'm all for scrapping the horribly burdensome corporate income tax. We'll replace it with a transactional tax on every item sold in the USA. No, not a sales tax paid at the register, when it's sold to the retailer. Don't pay it? Your products don't go on shelves. Services get the same tax to be fair. There are no exemptions, refunds, et al. (Not for profit rules apply to the buyer only)

Suck it up buttercup, that office in Dubai isn't so useful now.


It's already been mentioned, but you're describing a VAT system, already in place in much of Europe (part of the reason their corporate income taxes can be lower.)

/tax nerd
 
2014-08-20 03:43:40 PM  
fickenchucker:
In reality businesses don't pay taxes.  Consumers do through higher prices.

Completely untrue.  Revenue is limited by the demand curve.  If businesses could charge more money and increase revenue... they already would be, whether their taxes are going up or not.  I can't believe anyone with a brain believes this.
 
2014-08-20 03:45:11 PM  

pkellmey: dwrash: Why are our tax codes written with so many holes that you KNOW the politicians knew about when signing them.... let that sink in a while.  The corporations are just taking advantage of lawmakers mistakes.

Mistakes? I think you underestimate lawmakers.


This is a common but probably mistaken belief.  The tax code actually makes a good effort at being fair.  Those thousands of pages of law and regulation aren't there to create "loopholes," they actually exist because for every simple law or regulation enacted some very smart and hard working lawyer or accountant is going to find a way to exploit the rule in a way contrary to the spirit of the law.  Congress and the IRS responds by passing a new rule trying to shut that practice down and then the lawyers get paid even more to figure out how to exploit the new rule which leads to yet another new rule.  It's like a game of whack-a-mole.
 
2014-08-20 03:57:01 PM  

Clever Neologism: fickenchucker:
In reality businesses don't pay taxes.  Consumers do through higher prices.

Completely untrue.  Revenue is limited by the demand curve.  If businesses could charge more money and increase revenue... they already would be, whether their taxes are going up or not.  I can't believe anyone with a brain believes this.


12milebr.files.wordpress.com
 
2014-08-20 04:11:29 PM  
Lying is bad, but at least they are not killing anyone for money.
 
2014-08-20 04:13:22 PM  

neversubmit: Lying is bad, but at least they are not killing anyone for money.


Now who's being naive?
 
2014-08-20 04:13:48 PM  

Debeo Summa Credo: Yeah pretty much this. If corporate taxes were really as low as HuffPo would have you think, then these inversions would be pointless.


They are. And what's more when you relocate to another country, you subject your company to the local regulations. There is nowhere in Europe with financial regulations as lax as the US, plus some countries don't care where your operations are, if you're located within them they expect you to follow certain regulations everywhere.
 
2014-08-20 04:17:03 PM  

grumpfuff: I thought TFA was going to be about those inversion therapy hanging things you see on the TV, and was confused wtf that had to do with politics.


That commercial always makes me laugh.  "No, you can't have it.  It's one of my most valuable possessions.  It really is."

Farkin' seriously?
 
2014-08-20 04:18:29 PM  

IvyLady: neversubmit: Lying is bad, but at least they are not killing anyone for money.

Now who's being naive?


I thought I was being funny, but then again I'm crazy.
 
2014-08-20 04:25:28 PM  

WhyteRaven74: Debeo Summa Credo: Yeah pretty much this. If corporate taxes were really as low as HuffPo would have you think, then these inversions would be pointless.

They are. And what's more when you relocate to another country, you subject your company to the local regulations. There is nowhere in Europe with financial regulations as lax as the US, plus some countries don't care where your operations are, if you're located within them they expect you to follow certain regulations everywhere.


It's amazing how many people around here know better than the actual management of companies what is best for those companies.

If you guys would ever climb out of your mom's basements you could be titans of industry.
 
2014-08-20 04:36:00 PM  

TheManMythLegend: I think the issue that yes a company that operates 90% in the USA,  isn't going to go bankrupt because of the Tax Code,

But if that company merges with another company and all of a sudden their revenue from out of country jumps then they are at a disadvantage if they stay incorporated in the USA potentially, thus requiring an inversion, that's the way I understand it.


How in the name of all that's decent could you possibly infer that from this article? Honestly.
 
2014-08-20 04:43:01 PM  

palelizard: I'm all for this idea. Make it legal, the killer gets the dead guy's golden parachute, but it has to be done with their own hands (tools are okay, like guns, they just can't hire anyone to do it for them).


No way.  That would ruin its value as reality tv fodder.

Pre-gunpowder weaponry only.  Maybe build a big arena, go Hunger Games with that shiat.
 
2014-08-20 04:43:39 PM  
There is a very simple solution to stop this completely.  Make it a felony for any politician to accept donations directly or indirectly from any foreign company or individual.  Additionally, make it a felony and revocation of all ability to do business in the US if a foreign company or individual who makes any political contribution.

Call it the "Stop Iran and North Korea from Controlling Our Government" bill.

If they aren't American citizens, they should not be allowed any say in how our government works.
 
2014-08-20 04:47:05 PM  

Debeo Summa Credo: WhyteRaven74: Debeo Summa Credo: Yeah pretty much this. If corporate taxes were really as low as HuffPo would have you think, then these inversions would be pointless.

They are. And what's more when you relocate to another country, you subject your company to the local regulations. There is nowhere in Europe with financial regulations as lax as the US, plus some countries don't care where your operations are, if you're located within them they expect you to follow certain regulations everywhere.

It's amazing how many people around here know better than the actual management of companies what is best for those companies.

If you guys would ever climb out of your mom's basements you could be titans of industry.


It can be both pointless and beneficial.

They project that doing something drastic will save money, stock prices go up.

Regardless of whether or not their estimates are accurate.  Maybe it really saves nothing, maybe it ;s a wash, maybe it's even a loss.  But, hey, they got stock prices up by doing something drastic.

You see the same thing with reductions in force.  Other costs go up due to the RIF, and people have to do two or three people's jobs, but, hey, they got rid of people, and that saves money, right?  On paper, at least.  Good jorb, let Wall St. reward you.
 
2014-08-20 04:48:11 PM  

China White Tea: palelizard: I'm all for this idea. Make it legal, the killer gets the dead guy's golden parachute, but it has to be done with their own hands (tools are okay, like guns, they just can't hire anyone to do it for them).

No way.  That would ruin its value as reality tv fodder.

Pre-gunpowder weaponry only.  Maybe build a big arena, go Hunger Games with that shiat.


An arena means we can't market it as "No Boardroom is Safe".  Plus, rifles and whatnot give massive surprise value.  Since you have to prove it was you who did it to claim your prize, they'll have to film themselves anyway.  It's kinda like the ice bucket challenge, only with value.
 
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