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Apr 6 2021 05:37pm
I hear of all these companies (like amazon, nike, fedex, etc) who know how to work the loopholes in the tax system to pay zero federal taxes year after year. Some even get rebates back from the government...

So my question is this, what good will increasing taxes do on these major companies if they pay zero federal taxes right now, when they are supposed to be paying 21%?

I get like 30% of my check taken away right away to taxes and get pennies on the dollar back for my refund. How do these companies, that are supposed to pay 21% now, end up paying zero in federal taxes?

What good is raising the taxes going to do if they just find loopholes and pay nothing anyway?

Do you think they will actually pay something if their taxes are raised to 28%? Will they pay maybe pay like 7% (28-21 =7) if the tax rate increases to 28%

I don't understand it....seems like what the country needs is just for them to pay the 21%. A tax increase won't do anything if they already pay nothing when they are supposed to pay 21% IMO

Please help me understand this...
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Apr 6 2021 06:13pm
The likes of Amazon probably won't pay it, but SMEs will

Multinationals will engage in transfer pricing with some goods or services being 'sold' to a sister/parent/subsidiary company at cost plus a transfer/markup price from a tax haven so profits are transferred within the group to the low tax jurisdiction

Companies not paying tax is a bad look though, so even though they have the ability to transfer profits from the US, they may not all elect to do so if the reputational risk is high
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Apr 6 2021 06:16pm
One of the main point is to reinvesting profits so it's near zero tax reliabiliry. There's also tons of tricks, depending on country.
You can start to do like Donald Trump too... lol
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Apr 7 2021 05:16am
Unless I'm missing something, Amazon pays little or nothing because of previous losses, and investments in R&D and employee compensation.

You can use the pejorative term "loophole", but you would need to explain why those tax incentives should not exist. Is more money routed to Uncle Sam to burn through more valuable than Amazon investing it? I kind of doubt it.
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Apr 7 2021 05:31am
It sucks that corporations can skirt taxes, but then enjoy all the benefits of 'corporarions are PEOPLE' nonsense. They shouldn't be allowed to lobby or bid on contracts if they are not paying taxes as intended.

For example, Amazon could have paid taxes which may help low income factory workers assuming some would find social programs, who knows. Instead, they kept those taxes as profits through loopholes, and use the capital to lobby against their workers. They shouldn't get a seat at the table to lobby until taxes paid. Shouldn't be able to influence something your not a part of.

Within the last year Amazon made a huge legal stink when the US government awarded a cloud contract to Microsoft. I rofled, it's like a club member complaining when they haven't paid dues.

This post was edited by RedFromWinter on Apr 7 2021 05:38am
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Apr 7 2021 12:30pm
Raising the corporate tax rate would target small and mid level corporations far more than massive corporations. The Amazons still wouldn't be paying much if anything in federal level taxes, while the LLC's would see their profits syphoned off twice (profits and again when they write themselves a paycheck and get hit with income tax).

This is one of those scenarios where the majority of the people who talk the loudest know the least. But here's a situational for you: Amazon logs $1 Billion in profits. You tax them 21%, gaining the government $210 million. Amazon then turns around and banks the rest, where it sits and does nothing for anyone. Alternatively, Amazon logs $1 Billion in profits which they invest in 20 new distribution hubs, where the next year, they're employing 20,000 new workers with an average salary (from lowest to highest, all included) of $50/hour. That means the income that next year is going to be $2.08 Billion, which can now be taxed at the income tax level. But the shit goes deeper. Those 20,000 new employees also need to eat lunch, buy groceries, get haircuts, etc. So figure those 20K jobs are spawning off yet ANOTHER 5K+ jobs as a consequence. Let's toss in another few hundred million taxable incomes. Now, a lot of numbers float around about "how much taxes does the average American pay" but nearly all those numbers are wrong AND misleading. The average American has to pay FICA, the employer matches FICA, and the employer has to pay Unemployment Insurance for each employee. These are all mandatory non-refundable taxes. THEN you have the "federal tax rate". The average of that tax rate tends to around 18% of income. But when you add in the FICA&Match, as well as UI, you're adding in another 15% or so per employee. So if you have a say $2.3 Billion payroll income pool, the government is going to take in closer to $760 Million worth of tax revenue while simultaneously increasing the economic output and purchasing power of an area (which can also have very positive impacts on the higher level housing/tech/vehicle purchases).

Suffice it to say, the reason Walmart pays a metric fuckton in Federal Taxes annually while Amazon pays next to nothing has everything to do with Walmart banking their profits, as opposed to Amazon's constant reinvestment. And due to Walmart's rather conservative fiscal policies, as opposed to the rampant expansionist policies of Amazon, also underscores why Amazon is winning at every level, and Walmart is losing. But from a purely numbers-based calculation, taxing personal income and incentivizing business reinvestment is a FAR more fiscally responsible taxing method than attempting to tax both the corporation AND the employee to death.
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