Schmidt 'very proud' of Google's tiny tax bill: 'It's called capitalism' Google executive chairman Eric Schmidt has dismissed criticism over how little corporation tax his company pays, saying it's just capitalism. Schmidt is "very proud" of the corporate structure Google set up to divert profits made in European countries, such as the UK, to its firms in the low-tax havens of Ireland and The …
The clue is in the phrase "...mandated by law..."
Just because a company is in business doesn't mean it is LEGALLY obliged to maximise profits. Most companies have significant waste in their processes, so, in your world, directors should be prosecuted for NOT maximising profit?!? Just remind us which branch of law enforcement that responsibilty falls to, and how many times it has happened in the UK?
Oh, and BTW, once you start the personal insults, rather than attacking the message, it's a good sign that YOU'VE lost the argument.
"Stop repeating the shit about directors being mandated by law to minimize tax/maximize profit. It is a load of shit. The UK laws say nothing of the sort, the Delaware laws say nothing of the sort (in fact there is case law in Delaware stating that there is absolutely no legal obligation for a company to either maximize profit or minimize tax)."
In the USA there is the classic precedent set in Dodge v Ford (1919) https://en.wikipedia.org/wiki/Dodge_v._Ford_Motor_Company.
However, it is true that is not a law, just one decision - although a very influential one. The real basis for the claim that executives have a duty to maximize profit is that most corporations are set up to do precisely that - generate returns for their investors. Now I realize that some of the contributors to this thread are probably not large-scale investors. But just imagine for a moment that you are. You take £1000 of your hard-earned cash and use it to buy shares in Geegle Ltd. Considering stock market performance in recent years, you may see its value rise or fall, and you may actually lose every single penny of it. Ideally, you would like to see a "fair" return of at least a few percent per year.
Since no bank deposit account will give you any worthwhile interest after inflation (even before tax), it's important that there be some way for people to invest their savings and get some kind of income in return. If you think that is immoral profiteering, or whatever, don't forget that may investors are pensioners living on very low incomes, or pension funds that have to generate profits to pay the pensions people have earned through decades of hard work.
So if executives don't do everything in their power to maximize "shareholder value", in the jargon, they are failing in their duty to the shareholders and ought to be replaced.
Maybe the government should play the same game they do. Case in point:
http://www.theregister.co.uk/2011/08/05/hargreaves_review_trouble_ahead/
What the government needs to do, ignore Google. They don't want to pay their share of corporate taxes by using tax havens, so be it. When the Google lobby party goes to any government agency, they need to be ignored. If Google was looking at building something and is looking for tax breaks, you don't even see them to hear their proposal. You treat Google how they treat the governments of the world.
I also see where Google is coming from. For the longest time, you have multinational companies being taxed each and every way the governments could. They post profits in country B, C. D, etc. and if they brought them back to country A they would be taxed again. This is why tax haven were used as the governments forced the companies into it.
"explain their company’s flagrant abuse of the tax code to the detriment of all who play fairly"
The simple fact that companies are following existing tax code in each country is not abuse or unfair. Only an ignorant fool would not make use of these existing/legal methods. I understand it those people who are envious of the amount of money others are making/saving and that's the only reason for this kind of childish reactions. If each country is angry about companies using other nations for tax purposes, then they should work on making their nations attractive to those companies. This loud whiners are people who do not have the sense/ability to run as successful a company, and so get angry about it. In truth, they are jealous about it. If you want fair, institute a flat tax and everyone....I mean everyone pays the same tax rate. From the bloke driving the bus to the CEO running a milti-billion dollar company that brings jobs/business to each nation they operate in.
Only shortsighted fools want to attack successful companies with claims of unfairness. The political fools are the ones that can make a change, if they just shut their hot air flapping.
I say screw them and lets see each company exit and not do business with these childish nations.
"Don't hate the players, hate the game"
Your solution to childishness seems to be to act like some teenagers think they have to - do anything to be popular, even if that means you end up surrounded by vapid arseholes and become one yourself. To continue the teenage analogy with your argument, it is therefore perfectly OK for someone whom you thought a friend to betray what you thought were confidences on the basis that only a fool would not blab such juicy gossip and, anyway, you didn't say you didn't want anyone to know this one time.
As a teenager, I was bemused at the notion of popularity and the idea that personality faults seemed to be more forgiveable to some if you had improbable hair. Just because Daddy could afford to take you skiing every winter with anyone prepared to brown nose you didn't make you an intrinsically better person.
As an adult, I'm bemused that being able to play the tax and political lobbying game well makes you a successful capitalist and it's all down to your sense/ability, while being able to play the welfare game well makes you a dole scum scrounger who should be shot and it's all down to your substandard feral genes.
I'm at neither extreme. I hope that I have a reasonably adult sense of fairness. This whole letter versus the spirit of the law type argument is akin to a certain kind of notice that I see cropping up from time to time like "no goats allowed in the public bar" or "do not use this drill as a toothpick" where you just know that someone has acted like a dick in the past and used the "it doesn't say not to anywhere" defence. Do we really need to explain to companies how not to be a dick? Is there an adult way of doing so without them throwing a hissy fit? What's the international politics version of stopping the car and telling them to walk home?
There's a rather wonderful opening to a Poul Anderson novella that's rather apposite here:
"Crime is entirely a matter of degree. If you shoot your neighbour in order to steal his property, you are a murderer and a thief, subject to enslavement. If, however, you gather a band of lusty fellows in the name of honour and glory, knock off a couple of million people, take their planet, and hit up the survivors for taxes, you are a great conqueror, a hero, a statesman, and your name goes down in the history books."
As any fule know, it is not the content of what you say that matters in public, it is how it is perceived. And public perception is kindof core to how brands are looked at. Google is a massive brand, usually topping the most valuable type lists.
He said "if you don't like it sit on this and swivel". That isn't, ever, going to increase the value of your brand. Cue unhappy share holders.
I don' think this is going to work itself out in the political field, but may have a real effect because of perception.
This is not a Ratner-scale fcuk up, but Schmidt is working his way up there. Dickhead.
I have no respect for them, they're not as intelligent as they think they are or they would be releasing groundbreaking original products left right and centre. Except they're releasing boring shit like email, social media, phone software and search engines. Whoopee shit, stuff invented by other people and then copied by Google.
When did obeying to the law become immoral? If MPs have written laws that allow for conduct they now consider immoral surely those MPs have only themselves to blame? They are after all responsible for creating those laws. Perhaps if the UK government spent it's time rewriting it's tax laws rather writing press regulations to make UK liable laws even more insanely repressive and putting CCTV cameras everywhere they could solve these problems without the hypocritical moral outrage
Isn't that the line most MP's fed us. The difference is Google are not the ones who get to make the law, they are not the ones selected to decide what is right and what is wrong. Well done to the MP's for identifying the issue, all you need to do is change the rules, it works better the whining that someone smarter than you managed to outwit you.
MP's you have the power to put this right, just do it.
Polite applause at the Google.
It is doing its legal duty and upholding local laws in a way that most multinationals might be a little envious of?
The problem in the UK is not Google's approach under law to tax and such.
MM-mm baby! Those have been left there kindly by HM Treasury and HMRC for organisations to use.
(Remember HMRC and HM Treasury are quite prepared to give instruction that UK traffic lights have to operate in a manner that gives greatest return to HM Treasury. Of course your local government (e.g. council) did that, failed to report accurately to you that it was following non-governmental instruction (in the language of the day it was colluding rather than conspiring but the difference in fact might be negligible?)
No.
The far bigger problem is HM T and HMRC addiction to cash - your cash.
And it wants it now. Now!
re: what''s moral about taxing someone for dying?
Someone's got to pay for all the wars on the other side of the planet.
But more importantly, it's the future wars that have to be funded by taxation - they're not going to come cheap...and not paying your fair (sic) share is unpatriotic and verging on treasonous.
/sarcasm off
I'm getting more and more convinced that we are rapidly heading for a society where You will be assimilated. The future is Borg. Resistance is futile.
A family of slumlords who kept a huge set of derelict London docks before they gave the site to charity after container docks closed them. Well nearly. They never paid any tax at all and I don't know who the landlord of Canary Wharf is nor who any of the other old dockland owners are.
I do know as Britains biggest meat importers at one time, they famously never paid tax.
Google did not proclaim to be holding themselves to a higher standard than red toothed capitalism (their "don't be evil" slogan). If your going to be a no holds bar company with an army of tax lawyers, don't expect anyone to treat you as anything more than another corporation.
...isn't that CEOs/Boards are "serving" the shareholders by minimising their tax bills, it's the way they are minimising those tax bills.
In the case of Starbucks, for example, Starbucks UK is paying a shitload of cash for "permission" to use the Logos/name/etc to Starbucks in the Netherlands as well buying it's coffee at above market rates from Starbucks office in Switzerland. They claim to have made no profits in 14 out of 15 years of trading in the UK.
Supposedly, the stock market ought to be massively downgrading the value of Starbucks shares to junk status based on that performance. Plenty of profitable companies have gone to the wall because the stock traders bailed out not because the company made a loss, but because the company didn't grow as much as predicted. Yet Starbucks still exists.
Starbucks UK is still basically a US company with US management, people who worship at the alter of profit at all costs. Why have they not shut up shop and gone home if they can't make a profit? The reality is that they do make a profit. They just hide it in overly large chargebacks to parent/sister companies which may well be technically legal by the strict letter of the law, but which would never happen if these companies were unrelated, ie they'd not pay those high rates, they'd look for a cheaper supplier.
Since my wife doesn't work, maybe I could pay her up to the tax free PAYE allowance for cooking and cleaning and then I can claim that as a tax write off against my tax bill?
and especially tax law is very complex, open to interpretation and appreciation.
You claim it was it business trip, the taxman says it was a holiday. Who decides who is right?
You and your 15 experienced tax lawyers claim it was a business trip, the taxman agrees.
There's always a reason why somebody thinks he shouldn't pay taxes. A couple of centuries ago, the happy few didn't pay taxes because they were preferred by God. Now, the happy few don't pay taxes because they are preferred by capitalism.
This little shit is proud not to pay taxes. I can live with that.
If I ever have half chance I'll kick him in the gonads. And I will be proud of that accomplishment, because payback is a bitch. I hope everybody joins me. Can he live with that?
Seriously? I get we're supposed to be outraged, but how much in taxes should they be paying if they are currently legal? As it's legal, what additional authority gets to be in charge of "Tax moral obligations"?
This has always astounded me. Just like people, corporations will use whatever legal means necessary to save on taxes. They have every right to do so, and they have every obligation to do so. If the folks making the laws find that behavior distasteful....maybe they might make some laws to fix that behavior they find so reprehensible?
Of course they won't, because those laws are in place for a reason.
Faux outrage. Moving on.
Everybody knows that Greed is the basis of capitalism, "morality" is a concept invented by crypto-communists to thwart business.
Google still doesn't do evil, followers of the Golden Calf just don't have the same definition for that word. If you know that "paying tax = evil", then everything is right again!
Maybe?
One does not have to live by the rules rather one is penalised for not upholding the rules?
The answer seems pretty obvious regarding tax avoidance, tax evasion - if rules are not upheld then it costs money?
Besides, penalties which send money to HM Treasury really are not making justice at all.
All it does is send money to HM Treasury and what has that to do with justice?
Now that government bodies have invoked a principle of "morality" into dealings then I believe it give every UK subject opportunity to appeal against anything on basis of morality?
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