Watchdog Accuses Silicon Valley Giants of Dodging $100 Billion in Taxes
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Six of the Silicon Valley Masters of the Universe have been accused of dodging $100 billion in taxes by a British tax watchdog.
CNBC reports that six major Silicon Valley tech firms have been accused of having a combined “tax gap” of $100 billion over the past ten years according to an analysis by a British tax organization. Fair Tax Mark, a British organization that certifies businesses for proper tax conduct, examined the global tax payments of Facebook, Apple, Amazon, Netflix, Google, and Microsoft from 2010 to 2019.
The research analyzed the company’s 10-K filings submitted to the U.S. government by the tech giants. Fair Tax Mark looked at tax provisions, which is the amount that companies set aside in their financial reports to pay taxes, and compared these with the amount of money that the companies actually paid to the government, called cash taxes. Researchers found that over the past ten years, the gap between the tax provision set out by the tech firms and the taxes they actually paid was approximately $100.2 billion.
The report also claimed that the profits were “shifted to tax havens, especially Bermuda, Ireland, Luxembourg and the Netherlands.” The researchers noted that most of the tax shortfall “almost certainly arose outside the United States,” with tax charges from countries outside the United States coming to 8.4 percent of the companies’ profits overseas.
Paul Monaghan, CEO of Fair Tax Mark, discussed the report with CNBC stating: “The amount of tax being paid by these businesses is $100 billion less than reported in their accounts.” The report noted that Amazon was the worst offender of the six tech firms. The report alleged that Amazon paid $3.4 billion in income taxes since 2010, noting that the cash tax paid by Amazon amounted to 12.7 percent of its profit for the decade despite the corporate tax rate being set at 35 percent for seven of the past ten years. President Donald Trump cut the corporate tax rate to 21 percent in 2017.
The report stated: “The company is growing its market domination across the globe on the back of revenues that are largely untaxed and can unfairly undercut local businesses that take a more responsible approach.” A spokesperson for Amazon told CNBC in a statement:
Amazon represents about 1% of global retail, with larger competitors everywhere we operate, and had a 24% effective tax rate on profits from 2010-2018. Amazon is primarily a retailer where profit margins are low, so comparisons to technology companies with operating profit margins of closer to 50% is not rational. Governments write the tax laws and Amazon is doing the very thing they encourage companies to do — paying all taxes due while also investing many billions in creating jobs and infrastructure. Coupled with low margins, this investment will naturally result in a lower cash tax rate.
Facebook had the second-biggest tax gap with the cash tax it paid representing 10.2 percent of the profit it made over the decade. A spokesperson for Facebook told CNBC:
In 2018 we paid $3.8 billion in corporation tax globally and our effective tax rate over the last five years is more than 20%. Under current rules we pay the vast majority of the tax we owe in the U.S. as that is where the bulk of our functions, assets and risks are located. Ultimately these are decisions for governments and we support the OECD process which is looking at new international tax rules for the digital economy.
Google ranked third with its taxes amounting to 15.8 percent of its profits with its foreign tax charge amounting to 7.1 percent. A Google spokesperson told CNBC that the report form Fair Tax Mark “ignores the reality of today’s complicated international tax system and distorts the facts documented in our regulatory filings.”
The company added: “Like other multinational companies, we pay the vast majority — more than 80% — of our corporate income tax in our home country. As we have said before, we strongly support the OECD’s work to end the current uncertainty and develop new tax principles.”
Netflix ranked fourth in the list handing over 15.8 percent of its profit while Apple ranked fifth with a tax rate of 17.1 percent. Apple told CNBC in a statement:
As the largest taxpayer in the world, we know the important role tax payments play in society. We pay all that we owe according to tax laws and local customs wherever we operate, and since 2008 Apple’s corporate taxes alone have totaled over $100 billion.
Microsoft paid the highest tax rate of 16.8 percent with a spokesperson telling CNBC: “Microsoft is fully compliant with all local laws and regulations in every country in which we operate. We serve customers in countries all over the world and our tax structure reflects that global footprint.”
Read more about the report at CNBC here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or email him at lnolan@breitbart.com
Despite a booming economy, many U.S.
households are still just holding on
https://mexicanoccupation.blogspot.com/2019/05/the-recovery-that-never-happened-except.html
"One of the premier
institutions of big business, JP Morgan Chase, issued
an internal report on the eve of the 10th anniversary of the 2008
crash, which warned that another “great liquidity crisis”
was possible, and that a government bailout on the scale of that
effected by Bush and Obama will produce social unrest, “in light of
the potential impact of central bank actions in driving
inequality between asset owners and labor."
Seventy percent of US Millennials say they are
likely to vote socialist
The fourth annual report on “US Attitudes Toward Socialism,
Communism, and Collectivism,” commissioned by the anticommunist Victims of
Communism Memorial Foundation and conducted by YouGov, found a sharp growth in
interest in socialism among youth in the US over the past year.
The study has been conducted annually since 2016 and bases
itself on interviews with over 2,000 people.
This years’ results reveal a significant radicalization taking
place among youth, particularly in the Millennial Generation (those aged 23-38)
and Gen Z (aged 16-22). Compared to last year’s report, favorable views of
capitalism dropped 6 percentage points and 8 percentage points for Gen Z and
Millennials, respectively.
Other notable findings include:
* 70 percent of Millennials say they would be “somewhat likely”
or “extremely likely” to vote for a socialist candidate. The percentage of
Millennials who say they would be extremely likely to vote for a socialist
candidate has doubled (from 10 percent in 2018 to 20 percent in 2019).
* Overall, 83 percent say they know at least a little about
socialism, and 39 percent of Americans say they “know a lot”—a nearly 40
percent increase from 2018.
* Nearly half of Millennials think the government should provide
a job to everyone who wants to work but cannot find it.
* Forty percent of Americans (45 percent of Gen Z and
Millennials) think all higher education should be free.
* Around one in five Millennials thinks society would be better
off if all private property were abolished.
* Seventy percent of Americans say the divide between the rich
and the poor is a serious issue.
* Of the more than half (63 percent) of Americans who think the
highest earners are “not paying their fair share,” 54 percent think increased
taxes are part of the answer, and 47 percent say a complete change of the
economic system is needed.
* Thirty-seven percent of Millennials think the US is one of the
most unequal societies in the world.
* Over a quarter of Americans across all generations said Donald
Trump is the biggest threat to world peace.
The source of this radicalization is not hard to find. The chief
characteristic of life for Millennials and Gen Z has been skyrocketing social
inequality. Many are forced to work two, three or even four jobs to make ends
meet. One in five millennials is living below the poverty line.
The growing interest in and support for socialism coincides with
a significant growth of class struggle and social protest internationally. In Lebanon,
massive protests have brought an estimated one quarter of the country’s six
million people onto the streets. In Chile, millions of people continue to flood
the streets protesting social inequality and state violence in the largest
demonstrations in the country’s history.
In the US, the strike by 32,000 Chicago teachers and support
staff is in its second week, following the largest autoworker strike in 30
years by GM workers.
This eruption of the class struggle on a global
scale terrifies the ruling class. They are acutely
aware of social tensions and the growing interest
in socialism.
scale terrifies the ruling class. They are acutely
aware of social tensions and the growing interest
in socialism.
The response of the Trump administration has been an open turn
towards fascistic and authoritarian forms of rule. His hysterical denunciations
of socialism, now a feature of nearly every rally, express the growing fear of
the rich that demands for social reform will set off a mass movement for social
equality.
On the other hand, the Democrats, speaking for another faction
of the ruling elite, are determined to avoid anything that would mobilize
popular anger against Trump. They are systematically keeping out of their
impeachment inquiry any reference to Trump’s brutal crackdown on immigrants and
refugees, unending war and the social catastrophe confronting workers and youth.
Instead, they have focused their impeachment campaign on issues of foreign
policy.
It is within this framework that the Democratic Party’s
elevation of figures such as Bernie Sanders and Alexandria Ocasio-Cortez must
be understood. In order to provide a left cover for their right-wing policies,
these self-proclaimed “socialists” have been brought forward to direct growing
social anger back behind the Democratic Party.
In this latest campaign rally in Detroit on Sunday, Sanders once
again directed his remarks against social inequality, listing many of the
social ills confronting workers and youth. Most significant, however, was what
was not said.
Sanders made no reference to the more than month-long strike by
General Motors workers, which was just shut down by the United Auto Workers on
the basis of a contract that facilitates the massive expansion of temporary
workers, which has become the “new normal” for young people. Sanders also made
no reference to the ongoing Chicago teachers strike.
The omissions were not accidental. The Democratic Party, through
figures like Sanders and Ocasio-Cortez, propose a “socialism” (though they
almost never use the word) that does not involve the class struggle. Ending the
domination of the “billionaire class” is supposedly to be achieved without any
mass social movement or any challenge to the economic domination of the
capitalist class.
And it is supposedly to be done within the framework of the
Democratic Party, which is no less responsible than the Republicans for the social
conditions confronting workers and young people.
The critical question is to build a socialist leadership in the
working class and youth, to explain what genuine socialism is and how it must
be fought for. The fight for socialism means the fight to establish democratic
control of the giant banks and corporations by the working class. It means an
end to social inequality through a radical redistribution of wealth and the
expropriation of the ill-gotten gains of the corporate and financial
aristocracy. It means an end to war and abolition of the military-intelligence
apparatus.
The foundation for a socialist movement is the working class, in
the United States and internationally. The reorganization of economic life on a
world scale, on the basis of social need, not private profit, requires the
independent mobilization of the working class to take power and establish a
workers’ government.
Richest 400 Americans paid lower taxes than
everyone else in 2018
According to an analysis by noted economists Emmanuel Saez and
Gabriel Zucman, previewed this week by New
York Times columnist David Leonhardt, the wealthiest American households
paid a lower tax rate last year than every other income group for the first
time in the country’s history.
Saez and Zucman, both professors at the University of California
Berkeley, detail the phenomenon of declining taxes for the richest Americans in
their soon-to-be released book, The
Triumph of Injustice .
The pair compiled a historical database composed of the tax
payments of households in various income percentiles spanning all the way back
to 1913, when the federal income tax was first implemented. Their research
uncovered that in the 2018 fiscal year the wealthiest 400 Americans paid a
lower tax rate—accounting for federal, state, and local taxes—than anyone else.
The overall tax rate paid by the richest .01 percent was only 23
percent last year, while the bottom half of the population paid 24.2 percent.
This contrasts starkly with the overall tax rates on the wealthy of 70 percent
in 1950 and 47 percent in 1980.
The taxes on the wealthy have been in precipitous decline since
the latter half of the 20th century as successive presidential administrations
enacted tax cuts for the rich, suggesting that they would result in economic
prosperity for all. Taxes that mostly affect the wealthy, such as the estate
tax and corporate tax, have been drastically cut and lawyers have been hard at
work on the beliefs of their wealthy patrons planning out the best schemes for
tax avoidance, seeking to drive tax rates as close to zero as possible. The
impetus for the historical tipping point was the Trump Administration’s 2017
tax reform, which was a windfall for the super-rich.
Supported by both the Republican and Democratic Parties, the two
parties of Wall Street, Trump’s tax cuts were specifically designed to transfer
massive amounts of wealth from the working class to the ruling elite.
The corporate tax rate was permanently slashed from 35 percent
to 21 percent, potentially increasing corporate revenues by more than $6
trillion in the next decade. The bill also reduced the individual federal
income tax rate for the wealthy and included a number of other provisions to
further ease their tax burden.
The story is different for many middle- and working-class
Americans. According to multiple analyses of the 2017 tax reform, 83 percent of
the tax benefits will go to the top 1 percent by 2027, while 53 percent of the
population, or those making less than $75,000 annually, will pay higher taxes.
At the same time, the reform will sharply increase budget deficits and the
national debt, granting the pretense for the further destruction of domestic
social programs.
Furthermore, a majority of Americans are paying higher payroll
taxes, which cover Medicare and Social Security. The tax increased from 2
percent just after World War II, to 6 percent in 1960, to 15.3 percent in 1990,
where it stands today. It has risen to become the largest tax that 62 percent
of American households pay.
The result of the multitude of changes to the US tax system over
the last three-quarters of a century is one that has become less progressive over
time. The 2017 tax reform effectively set up the foundation for a regressive
tax policy where the wealthy pay lower tax rates than the poor.
The implementation of a regressive tax structure has played a
major role in engineering the redistribution of wealth from the bottom to the
top that has brought social inequality in America to its highest level since
the 1920s.
According to Leonhardt’s preliminary Times review of The Triumph of Injustice,
Saez and Zucman offer a solution to the current unjust tax system in which the
overall tax rate on the top 1 percent of income earners would rise to 60
percent. The pair claim that the tax increase would bring in approximately $750
billion in taxes. Their tax code also includes a wealth tax and a minimum
global corporate tax of 25 percent, requiring corporations to pay taxes on
profits made in the United States, even if their headquarters are overseas.
In an interview with Leonhardt, Zucman states that history shows
that the US has raised tax rates on the wealthy before so therefore it should
be possible to do so now.
However, the last half century of counterrevolution waged
against the working class makes the parasitic nature of the ruling elite
absolutely clear, and underscores the well-known fact that the US is ruled by
an oligarchy that controls the political system. Neither the Democrats nor the Republicans, who both represent
this oligarchy and bear responsibility for the tax system, will make any effort
to implement Saez and Zucman’s modest proposal.
California
became a Democratic stronghold not because Californians became
socialists, but because millions of socialists
moved there. Immigration turned California blue,
and immigration
is ultimately to blame for California's high poverty level.
Economists: America’s Elite Pay Lower Tax Rate Than All Other Americans
Getty Images
The wealthiest
Americans are paying a lower tax rate than all other Americans, groundbreaking
analysis from a pair of economists reveals.
For the
first time on record, the wealthiest 400 Americans in 2018 paid a lower tax
rate than all of the income groups in the United States, research highlighted by the New York Times from
University of California, Berkeley, economists Emmanuel Saez and Gabriel
Zucman finds.
The
analysis concludes that the country’s top economic elite are paying lower
federal, state, and local tax rates than the nation’s working and middle class.
Overall, these top 400 wealthy Americans paid just a 23 percent tax rate, which
the Times‘ op-ed columnist David Leonhardt notes is a
combined tax payment of “less than one-quarter of their total income.”
This 23
percent tax rate for the rich means their rate has been slashed by 47
percentage points since 1950 when their tax rate was 70 percent.
(Screenshot
via the New York Times)
The
analysis finds that the 23 percent tax rate for the wealthiest Americans is
less than every other income group in the U.S. — including those earning
working and middle-class incomes, as a Times graphic shows.
Leonhardt
writes:
For
middle-class and poor families, the picture is different. Federal
income taxes have also declined modestly for these families, but they haven’t
benefited much if at all from the decline in the corporate tax or estate tax. And
they now pay more in payroll taxes (which finance Medicare and Social
Security) than in the past. Over all, their taxes have remained fairly flat.
[Emphasis added]
The
report comes as Americans increasingly see a growing divide between the rich
and working class, as the Pew Research Center has found.
Sen. Josh
Hawley (R-MO), the leading economic nationalist in the Senate, has warned
against the Left-Right coalition’s consensus on open trade, open markets, and
open borders, a plan that he has called an economy that works solely for the
elite.
“The same
consensus says that we need to pursue and embrace economic globalization and
economic integration at all costs — open markets, open borders, open trade,
open everything no matter whether it’s actually good for American national
security or for American workers or for American families or for American
principles … this is the elite consensus that has governed our politics
for too long and what it has produced is a politics of elite ambition,”
Hawley said in an August speech in the
Senate.
That
increasing worry of rapid income inequality is only further justified by
economic research showing a rise in servant-class jobs,
strong economic recovery for elite zip codes but not for working-class
regions, and skyrocketing wage growth for the billionaire class at 15 times
the rate of other Americans.
John
Binder is a reporter for Breitbart News. Follow him on Twitter at @JxhnBinder.
Census Says U.S.
Income Inequality Grew ‘Significantly’ in 2018
(Bloomberg) -- Income
inequality in America widened “significantly” last year, according to a U.S.
Census Bureau report published Thursday.
A measure of inequality
known as the Gini index rose to 0.485 from 0.482 in 2017, according to the
bureau’s survey of household finances. The measure compares incomes at the top
and bottom of the distribution, and a score of 0 is perfect equality.
The 2018 reading is the
first to incorporate
the impact of President Donald Trump’s end-
2017 tax bill, which was reckoned by many
economists to be skewed in favor of the
wealthy.
the impact of President Donald Trump’s end-
2017 tax bill, which was reckoned by many
economists to be skewed in favor of the
wealthy.
But the distribution of
income and wealth in the U.S. has been worsening for decades, making America
the most unequal country in the developed world. The trend, which has persisted
through recessions and recoveries, and under administrations of both parties,
has put inequality at the center of U.S. politics.
Leading candidates for
the 2020 Democratic presidential nomination, including senators Elizabeth
Warren and Bernie Sanders, are promising to rectify the tilt toward the rich
with measures such as taxes on wealth or financial transactions.
Just five states --
California, Connecticut, Florida, Louisiana and New York, plus the District of
Columbia and Puerto Rico -- had Gini indexes higher than the national level,
while the reading was lower in 36 states.
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