Evey tax dollar they cheat on, is one you and I have yo pay.
I've got news for you, every tax dollar they pay, you pay them first so the government can collect it from them. Furthermore it costs that business, and ultimately you through the stuff you buy, another 65cents for every dollar of tax collected through those businesses.
Ain't it nice to know, that they got you at the backend while you are filing to pay at front end too?
DO YOU PAY YOUR INCOME TAX
AT THE SUPERMARKET?
by D. Sherman Cox J.D. L.L.M. Taxation
Don't jump to the conclusion that these guys are "unfair tax evaders".
Remember, these companies are ALREADY paying taxes on all their income that they make in foreign countries. What they are avoiding is paying income taxes AGAIN to the US government on that income -- something that no other country requires of their corporations.
The law is broken. That's why these companies have to jump through hoops to just get back to a level playing field with other countries. Fix the law and these subsidiaries would close up instantly.
By the way, I suspect that if they DIDN'T do this, they would also be subject to criminal prosecution under Sarbanes-Oxley because they are not looking out for their shareholders' investments to the greatest degree possible.
But they're not cheating at all - they're only taking advantage of legal options to minimize costs! Do you grumble and complain that I take the standard deduction because "I am cheating"??
Evey tax dollar they cheat on, is one you and I have yo pay.
Cheat???
Where did you come up with that term? Perhaps you are not aware of the difference between tax avoidance, which is entirely legal and tax evasion, which is illegal. For your enlightenment:
"Anyone may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes."
- Justice Learned Hand
Helvering v. Gregory, 69 F.2d 810 (1934)
Tax avoidance is the act of avoiding any tax that you are not legally required to pay.
When you take a dependent deduction, for your child, on your tax form, that is tax avoidance. If you take a deduction for your 401k or IRA, that is tax avoidance. If you use your own car in travels for your work and take a deduction for it, that is tax avoidance.
What those corporations are doing, is entirely legal and they report their activities, as required by US law. Only when they fail to report their activities, do they cross the line between avoidance and evasion. In fact, these companies and more, use foreign sales corporations, in order to remain, at least, partially competitive with their foreign competitors.
Since US companies have to pay income tax on foreign earned income and almost all foreign companies do not suffer under that onerous weight, that worldwide taxation, by the US government, serves as a severe financial handicap to US companies, involved in foreign sales. If they could not manage to write off just a little of those foreign profits, then the only remaining choice would be to move offshore entirely, where the only tax that they would owe to the US, would be on the income earned from US sales, in the US. Then, instead of sheltering just some of their foreign earned income, they would be effectively sheltering all of it. The result is that there would be fewer jobs in the US and you and I would have to pay taxes to support those who are out of work, because of the greed of our government.
It's not cheating. It's just good business.
What the government should be doing, instead of trying to place an even bigger burden on our corporations, forcing even more to move completely offshore, in self defense, is to eliminate the corporate income tax and personal income tax, in lieu of a National Retail Sales Tax, that would make our companies extremely competitive in offshore markets. But, the politicians (in BOTH parties) realize that to do so, would take away a giant anvil that they can hold over our heads, any time we don't kowtow to them, so there is a lot of resistance. At least we now have Tom Delay on our side on this issue, so we just may see a NRST in a few years. But, until then, we can just set back and watch the government run more and more corporations out of the US. How do such nimrods get elected???
"Sure nit wit. As if a US small businessmen can compete against such tax cheats. I have to go with the Democrats on this one. Such off shore wise guys should be penalized. Should be a clampdown if they want to do business here. Evey tax dollar they cheat on, is one you and I have yo pay."
Why do you think these corporations aren't being prosecuted? Could it be because they aren't breaking the law? YOU may consider them cheats, but as Action America pointed out, there is an important distinction between tax evasion and tax avoidance. You may not recognize that distinction, but most do. Also, you may not recognize the duplicity of the authors of this abominable tax system demonizing those who try to negotiate it to their best advantage on behalf of their shareholders, but many sophisticated business people understand just how disengenuous that is.