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Apple, Google and Microsoft Are Hoarding $464 Billion In Cash (cnn.com) 256

Posted by msmash from the cash-hoarding dept.
Apple, Google and Microsoft are sitting on a mountain of cash -- and most of it is stashed far away from the taxman. Those three tech behemoths held a total of $464 billion in cash at the end of last year, according to a Moody's report published this week. From a report: Apple alone had a stunning quarter-trillion dollars of cash thanks to years of gigantic profits and few major acquisitions. That's enough money to buy Netflix three times. It's also more cash than what's sitting on the balance sheet of every major industry except tech and health care. All told, non-financial U.S. companies studied by Moody's hoarded $1.84 trillion of cash at the end of last year. That's up 11% from 2015 and nearly two and a half times the 2008 level. Roughly $1.3 trillion -- 70% of the total -- is being held overseas, where the money isn't subject to U.S. taxes. Apple, Google owner Alphabet, Microsoft, Cisco, and Oracle hold 88% of their cash overseas. Moody's said the tower of money stashed abroad reflects the "negative tax consequences of permanently repatriating money to the U.S."
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Apple, Google and Microsoft Are Hoarding $464 Billion In Cash More

Apple, Google and Microsoft Are Hoarding $464 Billion In Cash

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  • Wheres the source of the cash? (Score:3, Insightful)

    by Anonymous Coward on Thursday July 20, 2017 @01:28PM (#54846967)

    Sure, These companies are based in the US, but they are global companies.

    They should not have to pay US taxes on the profits they received via a cellphone sold in Europe.

    • Re: (Score:2, Interesting)

      by bobbied ( 2522392 )

      LOL.. Where I agree in principle.. I have to point out that there are those who believe these "evil rich mega corporations" should be taxed on repatriation of this money (bringing it back to the USA) and that they are "hiding" this money out of the 'tax man's" reach to avoid paying taxes they rightfully should.

      Personally, I believe that the issue is the USA's tax rates are too high on these companies so they are being encouraged to do business overseas instead of in their home country to shelter themselves

      • Re:Wheres the source of the cash? (Score:5, Insightful)

        by Daemonik ( 171801 ) on Thursday July 20, 2017 @01:55PM (#54847241) Homepage
        I think that if they repatriate this money they'll do exactly the same thing financial institutes have done with their cash. Sit on it. They won't "encourage local economic growth". If anything they'll reduce local economic growth by buying up and removing competition. Growth of anyone but themselves is not in their interests.

        • Re: (Score:2)

          by pnutjam ( 523990 )
          No mod points today, but your probably right.

        • What do you mean "sitting on cash"? You do realize that they are not just putting pallets of money in the CEO's office to stuff the couches with so he can "sit on" it, but they are keeping it on deposit someplace earning interest, right?

          Cash sitting in a US Bank is better for the US than cash sitting in off shore banks. At least the bank can loan parts of the money out to US customers... So it's still better being here. Now if they spend this money on things like factories and such, it's even more of a

        • Re: (Score:2, Informative)

          by Pete Smoot ( 4289807 )

          Well, in normal times, financial companies don't just sit on cash. They make money by lending it out. In the last decade, I got a bit confused about whether the investment banks are actually sitting on idle assets or whether this was just a bookkeeping illusion (moving money from a Treasury account to a Fed account which somehow makes the bank's balance sheet better.) But let's put that aside for a moment.

          How much cash a company has matters less than I used to think. If a company has "cash", it's not really

      • Re:Wheres the source of the cash? (Score:5, Insightful)

        by diesalesmandie ( 4523641 ) on Thursday July 20, 2017 @02:02PM (#54847323)

        Personally, I believe that the issue is the USA's tax rates are too high on these companies so they are being encouraged to do business overseas instead of in their home country to shelter themselves from the tax rates in the USA.

        Do you honestly believe if the USA's tax rates would be lower that they would pay US taxes? They do what they do because they can, plain and simple.

        • Personally, I believe that the issue is the USA's tax rates are too high on these companies so they are being encouraged to do business overseas instead of in their home country to shelter themselves from the tax rates in the USA.

          Do you honestly believe if the USA's tax rates would be lower that they would pay US taxes? They do what they do because they can, plain and simple.

          Yes. That's the entire point. They have paid every dollar of taxes that they are required to pay by the law. They're businesses, not charities, why would they bring that money here where it will be taxed and they will receive no benefit? If they did, the shareholders would remove any officers who was involved.

          LK

        • Personally, I believe that the issue is the USA's tax rates are too high on these companies so they are being encouraged to do business overseas instead of in their home country to shelter themselves from the tax rates in the USA.

          Do you honestly believe if the USA's tax rates would be lower that they would pay US taxes? They do what they do because they can, plain and simple.

          Yes, they would pay what is legally required, or the IRS goes after them.

          So are you trying to claim the tax law is unfair or that enforcement of existing tax law is not happening?

          If you think the tax laws are unfair, then I suggest you lobby to get the unfairness removed... If you think the IRS isn't enforcing the laws right, then I suggest you lobby your representatives to beef up the IRS's enforcement operations and/or prosecute those who interfere with this activity....

          • "If you think the tax laws are unfair, then I suggest you lobby to get the unfairness removed..."

            HAHAHAHAHAHAHAHAHA

            Like the average citizens tiny pile of cash and a lawyer or two are any match for the Mt. Everest sized pile and entire army of lawyers Big Corp can wield against you.

            In the sport of lobbying, were not even even playing in the same league. The same game, or even on the same fucking planet.

            So your suggestion of " go lobby to get it fixed " is amusing as hell.

      • Re:Wheres the source of the cash? (Score:4, Interesting)

        by Thelasko ( 1196535 ) on Thursday July 20, 2017 @02:11PM (#54847411) Journal

        Personally, I believe that the issue is the USA's tax rates are too high on these companies so they are being encouraged to do business overseas instead of in their home country to shelter themselves from the tax rates in the USA.

        I entirely agree. More specifically, I would like to see a tax swap between corporations and individuals. It would work like this:

        • Reduce or eliminate corporate tax
        • Dramatically increase the tax rates on the upper most individual income tax brackets
        • Tax dividends and capital gains at the same rate as regular income

        Despite what some people want you to think, wealthy individuals are not "job creators". Corporations are! Think about it. That's why my plan would stimulate the economy and still balance the budget.

        • I disagree.. I think the "wealthy" ARE actually the job creators when you look at who's paying income taxes.

          If you consider someone "wealthy" if they make in excess of $250K/year in income (a commonly drawn line) then the majority of those tax payers are simply small business owners who are not yet big enough to make it worth the trouble to not file as individuals. These people represent a LOT of the growth in employment because there are a lot of them. They are the small "Mom and Pop" businesses which

          • Wealth is not a fixed sized pie. I don't have less because Bill Gates has so much more. Remember, a rising tide (or ocean) lifts all boats...

            Wealth is absolutely a fixed size pie. Scarcity of resources [wikipedia.org] is the fundamental problem that economics tries to solve.

            The reason most small business owner's don't typically incorporate are:

            1. 1. Legal expenses, which are a one time cost
            1. 2. Double taxation, which my plan would eliminate

            Much more small businesses would incorporate if it wasn't for our corporate tax structure penalizing them for doing so.

            • Wealth is absolutely a fixed size pie. Scarcity of resources [wikipedia.org] is the fundamental problem that economics tries to solve.

              You are applying 19th century economics to the 21st century. Five of the biggest corporations in America are Apple, Google, Microsoft, Amazon, and Facebook. None of them rely on coal or iron ore. They rely on human ingenuity and intellectual property, neither of which is inherently limited.

              1. Legal expenses, which are a one time cost

              I incorporated on-line for $200. I spent $0 on legal fees.

              2. Double taxation, which my plan would eliminate

              Most corps in America are S-Corps, which are not subject to double taxation.

              • They rely on human ingenuity and intellectual property, neither of which is inherently limited.

                I'm going to go startup a multi-billion dollar company right now. Apparently, the things I need are abundant!

                Bullshit, human ingenuity is a finite resource. Companies have entire departments devoted to managing those resources. Human resources.

                Talented people are rare and therefore costly. The rules haven't changed.

              • None of them rely on coal or iron ore. They rely on human ingenuity and intellectual property, neither of which is inherently limited.

                Fundamentally, human labor is the only resource that costs money. You can't put money in the ground and extract coal, oil, or iron ore. You pay people to find it and get it out of the ground. That's why those resources cost money.

                Nothing has fundamentally changed to economics. The old laws still apply.

            • Wealth is absolutely a fixed size pie. Scarcity of resources [wikipedia.org] is the fundamental problem that economics tries to solve.

              Wealth is not a fixed sized pie over time. It changes size.

              Think about it, do we have the same amount of wealth in the world now that was available in the 1700's? How about in the USA since 1776? Of course not. I dare say that it is obvious that the standard of living has greatly improved since this country's founding. Wealth has increased, we individually live better, have more food to eat, houses to live in, have more stuff than our funders even though we went from 2.5 million to 325 Million people.

              • Wealth is not a fixed sized pie over time. It changes size.

                That's where we have a disconnect. I am not talking about wealth over time, I'm talking about wealth right now. Wealth right now is fixed. Over time it changes, that's why we have inflation.

                So yes, you have less because Bill Gates has more. When the economy grows, everyone benefits. The problem is the wealthy benefit disproportionally more than everyone else. Their portion of tomorrow's pie is bigger.

                When people talk about taxing the wealthy, the goal is to make that growth closer to proportional

                • I am not talking about wealth over time, I'm talking about wealth right now. Wealth right now is fixed.

                  Of course "wealth right now" is "fixed". Anything "right now" is fixed—you've frozen it in one moment in time. This is not the same as saying that wealth is fixed in general, which would imply that wealth cannot change over time.

                  Over time it changes, that's why we have inflation.

                  Inflation is not due to an increase wealth, but rather an increase in money. More specifically, price inflation is due to the money supply increasing faster than the supply of goods, which may be either increasing or decreasing.

                  So yes, you have less because Bill Gates has more. ... The problem is the wealthy benefit disproportionally more than everyone else. Their portion of tomorrow's pie is bigger.

                  The amount you receive does not decrease just bec

                  • The amount you receive does not decrease just because Bill Gates's share is increasing. That is what it would mean for wealth to be fixed—more pie for anyone else means less for you, not merely relative to them but relative to what you had before. Perhaps you're getting a smaller percentage, but it's still at least as large in absolute terms.

                    Thought experiment time!

                    Bob and Jim both have 50% of a pie with a mass of 500g. Bob has 250g and Jim has 250g. Agree?

                    Now the pie doubles to 1000g, but Bob has 70% of the pie and Jim has 30%. Bob now has 700g of pie, and Jim has 300g of pie. Did I do my math right?

                    Both Bob and Jim have more pie than before, but Bob received a disproportionately larger increase in pie than Jim, almost a whole pie! This is what I'm talking about. Everyone can become wealthier, while a few can become disproportionat

                • So you admit that Wealth is NOT a constant, it can change over time and that MONEY is NOT the same thing as wealth as the value of money changes over time (i.e. your inflation reference). Great, then think about it like this...

                  What can you have tomorrow, how much can I improve my wealth over time? Isn't that *really* the issue here? How do I get more wealth? Is it possible for me or you to have as much as Bill Gates in the future? Sure it is *possible*....(although it may be unlikely we'd both be as lu

                  • I see your point on wealth creation. However, you use Bill Gates as your example. Bill made this new wealth through his company, Microsoft. Although Bill was instrumental, Microsoft created the new industry and the jobs that go with it. The same goes for most wealthy people. Eliminating the corporate tax would make it easier for them to do so.

                    A strongly progressive personal income tax structure would not harm Bill's ability to grow Microsoft. It would make it harder for him to extract the wealth he
                  • By the way, this has been a great discussion. Unfortunately, there have been too many threads on Slashdot lately that descend into name calling with no attempts to form a rational argument.

                    Thank you.

          • Yea, let's "soak the rich" they don't deserve to be that wealthy!

            I suppose there are some people that make that argument, however that is not a compelling one. The purpose of a progressive tax structure is to compensate for the fixed costs associated with basic human existence. [wikipedia.org] Individuals that have substantially more than those basic needs aren't as affected by taxation.

            Rather than thinking tax the wealthy, we should probably think of it as don't tax the poor.

        • ... I would like to see a tax swap between corporations and individuals. It would work like this:

          • Reduce or eliminate corporate tax
          • Dramatically increase the tax rates on the upper most individual income tax brackets
          • Tax dividends and capital gains at the same rate as regular income

          Good thoughts. End the corporate income tax and then normal income tax rate on dividends would no longer be double taxation.

          As for capital gains... I could go along with taxing long-term capital gains at the same rate **IF** the "gains" are adjusted to take inflation over the time of the investment into account. I think an inflation adjustment should be applied to all interest income, too. Not to mention those tax brackets. Give Congress a steeply progressive set of tax brackets, and the McDonald's' ha

          • Yes, it's very important to have inflation compensation that is reliable, accurate and not politically influenced!

        • I have an alternate suggestion: Have a flat tax on all income, with all forms of income treated the same. Make the first $10,000 tax free and take 25% of the rest. Eliminate all the tax breaks, except make payroll and benefits taxed to the recipient only.

          • If I was going to go the flat tax route, I would include universal basic income. Pay everyone $10k, and then take 25% of all other income. I'm open to higher combinations too. $20k and 50%? Things might get dicey after a 50% tax rate, [wikipedia.org] but I'd be open to going slightly above it to see what happens. Figure out a combination that can would eliminate social welfare programs while balancing the budget.

            As noted by another commenter, inflation adjustments would be necessary. I think it would really reduce

      • I think that since my personal, Federal tax rate is ~25%, then I have no sympathy for the corporations who whine and cry about how high their taxes are. Especially when they're allowed to hide much of their income from the Tax Man.

        They should use the whole " Corporations are People " ( see Citizens United ) argument in this case and treat them as such.

        If you want to reap the benefits, you have to accept the downsides of it as well.

      • You are 100% correct. The USA has the highest marginal corporate tax rate [taxfoundation.org], and the 3rd highest effective corporate tax rate. Why should they pay more than they would pay in any EU country? Lower the marginal corporate tax rate to the OECD average around 20%, ensure the effective corporate tax rate is down near the OECD of 15%, and I bet a ton of that cash would flow back...

        In fact, if it were my choice, I'd set the corporate tax rate to 0%. And I would state that US corporations must be headquartered in

    • US tax law is complicated, according to its tax code you have to report foreign assets and pay a portion of taxes on foreign income. There is however little to no framework for forcing a subsidiary or shell company to do so (hence the setup). Apple (the multinational entity) holds $x in banks but Apple Computers Inc. DBA Apple Inc. in California doesn't, it doesn't even "own" the Apple Store in your local mall for all sorts of tax, financial, liability and other reasons. It's kind of dishonest to say Apple

    • Re: (Score:2)

      by Junta ( 36770 )

      But they also move US money abroad using tax exemptions.

      For example, they make themselves a wholly owned subsidiary of some Irish company. That Irish company charges the US based subsidiary a certain amount, wow look at that, it's right about 100% of what *would* have otherwise been US product! US company deducts as business expenses the amount of money they had to pay to their foreign parent company for whatever reasons (e.g. intellectual property rights, what have you).

      This is of course a gross oversimp

  • USA #1 !! (Score:5, Insightful)

    by Spy Handler ( 822350 ) on Thursday July 20, 2017 @01:33PM (#54847009) Homepage Journal

    We have the biggest, most complicated tax code in the history of the universe. We are also the only country that taxes its citizens for income earned while living and working in another country... even after they pay that country's taxes.

    • Personal income tax earned in another country has NO relation to corporations sitting on earnings stashed in another country.

      • Personal income tax earned in another country has NO relation to corporations sitting on earnings stashed in another country.

        It's exactly the same thing. The US taxes both corporate and personal income earned in other countries, which is something that other countries don't do. In both cases, it encourages people/corporations to find ways to avoid paying the extra tax by keeping the money outside of the country. Corporations are better at doing it legally; individuals usually end up having to lie about their income.

    • Re:USA #1 !! (Score:4, Informative)

      by mspohr ( 589790 ) on Thursday July 20, 2017 @01:48PM (#54847173)

      Don't know about the biggest and most complicated but that's another subject.
      As far as US citizens working abroad, they do give you credit for any tax paid to a foreign government and they do have a rather large base exemption before tax kicks in.
      What makes you think that you can take the benefits of being a US citizen and not pay any taxes?

    • Living in a foreign country does not exempt any citizen from paying taxes on stocks, business profits, or revenue generated within their home nation. Say you're a Canadian citizen who owns a McDonalds franchise in Canada. If you move to the United States, you still have to pay the Canadian government for the profits from your franchise in Canada. You just don't have to pay them for the franchise you own in the United States. The United States is the only country that taxes its citizens for income earned

  • Effect on Economy (Score:4, Interesting)

    by HeckRuler ( 1369601 ) on Thursday July 20, 2017 @01:34PM (#54847025)

    I don't really get finance. That's... not good for the economy right?

    It's money that's "Not being put to work". Just rotting in a bank account. Extrapolate this, and it's essentially a giant black hole in the economy where money goes in but it doesn't come out. Today we've got a money cycle of farmers buying oil to run their combines and oil-well workers buying food to eat. Today there's a trillion dollars moving back and forth (and being pissed away on recreation) but tomorrow Apple hoards half of that and now the cycle is moving just $500B. So... It's essentially deflation? If they ever dump it back into the markets, that'd be a big wave of inflation, ya? Suddenly there's just more cash in the system. Is half a trillion even enough? How much money is needed to have a noticeable impact on the value of the US dollar?

    So it's outside of the USA. Couldn't they go invest it in... China or something? Buy all of Foxconn. Do they have problem bringing it elsewhere? Would they have to pay China income tax if they went there? If it's all Irish money... Buy Guinness. ...I guess that just shifts the fat bank account from the owners of apple to the ex-owners of Guinness... Yeah, to actually make that money work, they'd have to actually launch a new business or expand their business or buy a business that needs expansion.

    Inflation is the sort of thing that's supposed to encourage people (or business, in this case) to go DO SOMETHING with their money rather than hoarding it. We should DEFINITELY NOT give them some sort of tax-free day to slip it in. Fuck you, pay me.

    • >It's money that's "Not being put to work". Just rotting in a bank account.

      Not quite. To be removed from the economy, you'd have to have cash or some other deflationary instrument in storage.

      Cash 'in the bank' isn''t really in the bank, but is being invested by the bank.

      • Re: (Score:2)

        by ceoyoyo ( 59147 )

        In this case it's almost certainly being invested by the companies themselves. Apple's "cash" reserves are mostly in the form of long-term marketable securities.

        • Honestly, by the time you have these kind of cash reserves, you should set up a new corporate division as a bank, cut out all the middlemen.

          Can you imagine having a Google Mortgage? And they'd already know everything about you to help them set your credit limit and interest rate!

          • Re: (Score:2)

            by ceoyoyo ( 59147 )

            Easier to just buy an actual bank. Or, since you like to have "phat cash reserves" on your balance sheet, just buy enough stock for a controlling interest in one.

            Maybe it's different in the US, but this is pretty much already done. I do most of my banking through the financial services arm of what used to be a grocer. One of my relatives works as an analyst for the financial services arm of a national chain of hardware and automotive stores.

            • >Maybe it's different in the US, but this is pretty much already done. I do most of my banking through the financial services arm of what used to be a grocer.

              1st: I am in Canada, so I can't speak to the US.

              2nd: I know the car companies have had their own finance divisions handling car loans for at least my entire life.

              3rd: Oh yeah. I haven't seen one in a while, but I do recall at least one my the local grocery chains starting to offer banking services.

    • It's money that's "Not being put to work". Just rotting in a bank account.

      No. The companies do invest it outside of the US because it would be dumb not to.

      It's not being invested inside the US because our country's unique and bizarre tax laws would cause a big chunk of it to be taken by Uncle Sam if the companies were to try to use it here. So, our tax laws are doing a great job of encouraging investment in other countries!

    • The money is being put to work exactly as you say - by investing into assets in the countries it is located in. Much of it is probably making it back to the USA as well through lending schemes facilitated by investment banks - Apple 'invests' a billion in bonds issued by Goldman Sachs' EU branch, and Goldman Sachs' USA branch buys up the latest billion dollar corporate bond issue from Apple. Note that the money isn't being repatriated so US tax is not triggered. GS has been around for 148 years, so the loan

  • It's just money (Score:5, Interesting)

    by monkeyxpress ( 4016725 ) on Thursday July 20, 2017 @01:41PM (#54847095)

    This really just demonstrates the stupidity of our current economic system, where money, which is a made-up human construct meant to facilitate the trade in real goods and services, has become more important than said real goods and services. We have a 'market' that pays our best and brightest far more to come up with these pointless number shuffling schemes than to become a doctor, scientist or teacher. We then wonder why, despite all the GDP we have supposedly magiced up in the last decade, many of our doctors, scientists and teachers can no longer afford basic shelter and services for them and their families.

    At a government level, we have treasuries slashing public sector spending to provide corporate tax breaks because politicians seem to believe that they can save for the care worker jobs that will be required by the ageing boomers in the future, by putting the young out of work today. Again, all driven by this belief that money is more important than the underlying economy it is meant to facilitate.

    And to add to the complete disconnected stupidity, we have central banks busy abusing the monetary system by printing trillions of dollars in an attempt to stop all this warped cash hoarding by the rich from deflating the real economy.

    It is really sad, and it is all going to come to a head at some point. Unfortunately I don't think anyone has a clear idea of how to fix it, and there is a great risk that we lurch too far to either the left or right, as has been the pattern throughout history.

    • Re: (Score:3, Interesting)

      by oh_my_080980980 ( 773867 )
      Actual they have http://prospect.org/article/pr... [prospect.org] it's called stopping profit shifting, and adopt “sales factor apportionment.”

    • where money, which is a made-up human construct meant to facilitate the trade in real goods and services, has become more important than said real goods and services.

      Not even. It just demonstrates that sensationalist news can reach out to people who don't understand monetary systems.

      Economies are demand driven. You know where jobs come from? We have people buying 20,000 tables a week, and each 1 person can make 1 tables per week. We have 19,500 people making tables. ... we can't do it. Welp, we better hire 500 more people.

      To supply those jobs, you pay wages. $10/hr and 40 hours of total human time to make a table? Table costs $400. If you don't charge at least

  • Offshore Consequences (Score:3)

    by Herkum01 ( 592704 ) on Thursday July 20, 2017 @01:47PM (#54847155)

    The US has been very generous at allowing shell companies and off-shore earnings to be store in other countries. Once a corporation gets a handout, they expect it into perpetuity and they want all the market access and its protections of the legal system while avoiding contributing to it.

    This basically shows that this is the consequence of letting companies sit on cash to avoid taxes. Another commenter said the US tax system is too complicated. It is, but the benefits from it go to corporations who use it to avoid taxes, not to increase them.

  • Economics (Score:5, Informative)

    by WhatsGoodman ( 4921679 ) on Thursday July 20, 2017 @01:53PM (#54847211)
    I work in Private Equity and have experience with this type of stuff. Honestly in my opinion, there's nothing to see here other than a great case for why the US corporate tax rate should be lower. There are two separate concepts worth discussing. One is money that was MADE offshore and remained offshore, which I don't think anyone should take issue with. That money is used to fund international operations and international acquisitions (and is invested--I recall reading that Apple runs the world's largest hedge fund via its balance sheet cash). No big-wig executive or shareholder benefits from this cash being offshore - in order for them to see any of it, it has to be repatriated, at which point it is subject to US tax. The other concept is money that was made in the US, but is treated as if it was made offshore. The way this works is generally via IP transfer. If a US company transfers its IP to a subsidiary in another country (Ireland is popular, for example), then that US company has to pay royalties to the international subsidiary as it does business. So US Co. makes $100 in search revenue, but has to pay $90 to Ireland Co. for the right to license the IP (oversimplified but that's the gist). $10 gets taxed in the US, and $90 gets taxed in Ireland, the profits remain in those respective countries. Note that when the IP is transferred to the other country, that transaction is taxable - the Irish subsidiary has to "purchase" the IP from the US, which is a taxable event that the US government receives tax income from. However, after the IP is transferred and once operations commence, this becomes frustrating for the US government (and citizens) because money that was made in the US becomes taxed in Ireland. However, even in this case, in order for US executives or shareholders to ever get this cash, the money must be repatriated, at which point it is subject to US tax. So the money ends up just staying offshore, until the company can either negotiate with the US government for more favorable tax treatment, or until it gets used for an offshore purpose. Long story short, if the US corporate tax rate was lower, we would not have this problem. Companies would not transfer IP offshore to achieve more favorable tax structures, they would just keep the money in the US. My personal opinion is that the corporate tax rate that maximizes revenue for the US is much lower than the current 35%.
    • Yet it seems to make logical sense that if there is less money floating around for an individual like me floating around, then it is harder to obtain and makes things more difficult to afford. I have retirement savings but not enough for this to make a difference. If we lower taxes on corporations then society is losing any way.

      • Re:Economics (Score:5, Insightful)

        by swillden ( 191260 ) <shawn-ds@willden.org> on Thursday July 20, 2017 @03:48PM (#54848185) Journal

        Yet it seems to make logical sense that if there is less money floating around for an individual like me floating around, then it is harder to obtain and makes things more difficult to afford.

        More money floating around can also cause inflation, making things more difficult to afford.

        If we lower taxes on corporations then society is losing any way.

        This is an illusion. Corporate taxes are an illusion. An evil one.

        Corporations never really pay taxes. The cost is always ultimately borne by people. Those people may be employees, if the corporation pays lower wages to offset its tax bill. They may be shareholders, if the corporation generates lower dividends or less increase in share price due to less growth. They may be customers, if the corporation chooses to pass the costs on in higher prices.

        At the end of they possibly-long chain of buck passing, though, the taxes are always ultimately paid by individuals. The legislature could get exactly the same effect if instead of taxing the corporations it taxed the individuals directly. Except that by taxing the corporation the legislature loses the ability to control what kind of people pay the bills. I think the ideal for most proponents of corporate taxes would be to levy them on the shareholders exclusively. But that's not only not guaranteed to happen, it's almost never what happens, due to the fact that the markets seek a given rate of return for an industry. All players in that industry (assuming they're all subject to the same taxes) will shift the tax costs elsewhere in order to maintain the rate of return, so they can attract capital when they need it.

        This makes taxing corporations dumb. What makes it evil is the very reason that legislators like it in spite of the fact that it takes away their ability to control who gets taxed. They like it because they can tell voters that someone other than the voters is paying the bill. This isn't true. It seems true, to people who don't understand what corporations really are or how they work. Voters who don't look at it very closely believe they're getting government services and big, faceless corporations are paying for it. But the fact is that although it's extremely hard to tell who is paying the bill, the one thing we know is that the corporations are not.

    • However, after the IP is transferred and once operations commence, this becomes frustrating for the US government (and citizens) because money that was made in the US becomes taxed in Ireland.

      But was the money made in the US? Pretending for a moment that the concept of IP has any legitimacy at all, why shouldn't the profit accrue primarily to the IP holder in Ireland, and not the licensee in the US? Isn't that how IP is supposed to work, rewarding IP holders at the expense of "makers"? You can't really support the principle of IP while simultaneously condemning US companies for paying IP licencing fees to foreign IP holders. The IP portion of a business is simply more mobile than, say, a physica

  • "Saving" is good, "hoarding" is bad. The choice of words implies the author's desire to confiscate all or part of the monies...

    To all those coveting other people's dabloons: they are not yours! [getyarn.io].

  • Repeal the 16th amendment (Score:3)

    by p51d007 ( 656414 ) on Thursday July 20, 2017 @02:05PM (#54847343)
    Replace it with a fair/flat tax and watch most of that money, come back to the USA, where it can be put to work. I don't understand why, "the poor" don't understand why they oppose it since they will see the biggest benefit. It also takes the power of government (congress, senate) to tax out of their hands.

  • If you earn money in a country then you should be required to pay a special tax to remove it from that country. New laws need to be adopted such that shifting money tax free through IP licensing and other such loop holes are closed.

    Simple. That requires a business presence. I do have issue with countries declaring a business presence and imposing their regulations were non exists. For example an advertising agency taking money for ads in the German language does does not give the country of Germany domain

    • New laws need to be adopted such that shifting money tax free through IP licensing and other such loop holes are closed.

      Easier said than done. These "loopholes" are a perfectly natural consequence of enforcing IP "rights" as if they were actual property rights. If IP is a legitimate concept, the majority of the profits derived from the use of that IP should accrue to the IP holder, not the user of the IP. After all, so long as the business cannot legally operate without licensing that IP, the foreign IP holder is providing the majority of the value (despite not doing any of the work).

      The only real way to close the "loophole"

  • another view (Score:3)

    by fche ( 36607 ) on Thursday July 20, 2017 @03:04PM (#54847837)

    Saving money is not "hoarding". Keeping it from the "taxman" is not only financially proper but morally ethical. Y'all fawning over the possible tax bill are just weaponizing your envy for the fruits of someone else's labour.

    • Keeping it from the "taxman" is not only financially proper but morally ethical.

      Yep, it's totally ethical to benefit from all of the structures that the little people pay for out of their taxes but not contribute at all.

      If you don't think taxes are ethical, try moving to the Libertarian Paradise of the Congo. See how enjoyable life without taxation really is.

      • Re: (Score:2)

        by fche ( 36607 )

        I know, I know, "muh roads".

        If you construe taxes as payment for services, please identify the specific US services that were used by the foreign operations of these companies that you wish them to pay for.

        • The US Navy and its protection of trade routes globally. The US negotiation of trade treaties that permit the sales of their goods globally. Usage of US Customs and US IP law, without which they would be undercut by clones globally.
  • Seriously. That's insane. Three companies sitting on five percent of M2!

  • ...That's enough money to buy Netflix three times.

    Well yes, Netflix subscriptions have become a little on the pricey side these days.

  • Note that while this is bad, generally speaking the economy works around value that pretty much gets sequestered out of circulation. So the result of injecting this money into the economy long term would pretty much be no change and a touch of inflation. Short term some people close to major influx of cash will be very happy and elevated, but it's like a pyramid scheme, barely moving the needle as it moves outward.

  • I propose a retro active tax on any company that initializes or in any degree controls a company with offshore earnings. When we repatriate that money it will be taxed again unless proof of investment in new or existing, unrelated companies is quickly made. That will put a dead end to off shoring American companies and money. See ! problem solved with no big fuss at all. The people must become aware that the power belongs to the people and not to government or corporations. Think of me as a rebel wi

    • Re: (Score:2)

      by PPH ( 736903 )

      Define 'controls'. Define 'a company with offshore earnings'. Define 'proof of investment in new or existing, unrelated companies'.

      You just created the biggest job security program for tax attorneys and accounting firms.

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