So many loop holes in our business tax system . I think an overhaul is due to make sure every business pays it's fair share of tax.
If I see any company getting away with not paying I will not use that companys services ect. (Not that I use FB though).
We should say to them you want to do business here pay your tax and if you do not we ban you from our shores

Companies like this are just take take take. Is it any wonder the Western world is in disarray? Sucking it dry and killing their economies. Something has got to give...

how can running a free website result in it making $1.3 billion and then posting a $24 million loss.

something fishy in marine land.

Originally posted by BlindBastards
Companies like this are just take take take. Is it any wonder the Western world is in disarray? Sucking it dry and killing their economies. Something has got to give...

But how can we hold their "feet to the fire" and get mega-companies like these to start paying their fair share? It's a nearly impossible task.

Originally posted by FatherStacks
But how can we hold their "feet to the fire" and get mega-companies like these to start paying their fair share? It's a nearly impossible task.

Ending the practice of single taxation for companies based in the US. What these tech companies are doing is basing their profit headquarters in Ireland (the highest tax rate for business' is 11%) because if you're taxed once by a foreign nation the US doesn't tax you again. This is how a three story building in the Cayman Islands can house 3,000 US companies at a 1% tax rate.

If you post losses and not profits then you can stand to get money back from the government, making your effective tax rate negative. If I had a lot more knowledge about it I'd have a lot more money, but that's the gist of it.

Originally posted by WhereIsTheBatman
In the mean while, the average Joe who bailed out the banks pays the full price.

I believe this article is speaking about the tax paid on Facebook's foreign revenue (profits made outside of the US).

Originally posted by randomname
how can running a free website result in it making $1.3 billion and then posting a $24 million loss.
something fishy in marine land.

I believe it works something like this and it's quite simple, two things needed:

1. A country with low to no Taxes - Facebook uses the Cayman Islands
2. A country that has a treaty with other countries that prevents being taxed twice. - Facebook uses Ireland.

Facebook Cayman Islands is the parent and licenses the rights to run Facebook outside of the US to Facebook Ireland. Facebook Ireland than licenses the rights out to all other Non-US Countries where Facebook has a presence.

So say Facebook UK makes 1 Billion Pounds in Profit, Facebook Ireland sends them an invoice for 99% in royalties/licensing fees, reducing their profit down to 10 Million Pounds.

Now Facebook Ireland has 990 Million Pounds in Profit, so Facebook Cayman Islands invoices Facebook Ireland for 99% in licensing rights, this leaves Facebook Ireland also with approx. 9.9 Million Pounds in profit.

Cayman Islands now posts the profit of 990 Million Pounds @ the Cayman Island tax rate of 0%.

The purpose of having Ireland is that they have the treaty that now prevents other countries attempting to double tax Facebook. As they have already been taxed by Ireland for the 9.9 Million Pound Profit posted.

How corporations are allowed to be structured needs a massive overhaul. Corporations are allowed to do way too many things that individuals cannot.

It's really no wonder people are beginning to hate capitalism. The main job of our government - protecting the rights of the individual - has been ignored.

This is one example of why I'm so angry about the US government. We pay a massive amount in taxes while greedy corporations pay very little with accounting loopholes --> and they want us to pay MORE MORE MORE.

Originally posted by zerohaze
I believe this article is speaking about the tax paid on Facebook's foreign revenue (profits made outside of the US).

Here's my problem with this.

I am a US citizen & live in a foreign country. We still have to pay our US taxes the same as if we lived on US soil. Why are corporations allowed to get away with this?

By the way - none of our European friends are subject to this. They pay no taxes when they live/work outside their own countries.

I would like to thank the OP for this post.

It not only shows the joke of our tax system, but the hypocrisy of the liberals.

First the tax issue.

The code is set up purely to let politicians give the appearance of helping the "middle class", give more welfare money and keep the rich (including themselves) safe.

It is so full of loopholes, condridictions, and enough legalese that even the IRS (supposed inforcers of the code) does not know how it all works. The whole time the middle class basically pays for it all.

I propose a simple flat tax.

It would work like this. Everyone and business (on gross income not after expenses) pays (example) 20 percent.
At the end of the year everyone gets back what they paid on the first 15,000 (thus satisfying the need to have a refund).

Eliminate the earned income tax credit based on the simple theme if you did not pay or pay over 15,000 then why the heck should you get back an extra XX thousands? No hiding another form of welfare, bring it out into the light.

No tax on savings, social security (you paid into it after taxes), your pension (if it is after tax, if not its income) or estate taxes (why should you pay again on money/property you saved for your family).

Everyone would pay their fare share. Be they earn 20,000 or 20 million.

The sideline benifits are

1. so simple if the congress wants to raise the rate its clear what the raise is. No "extra deduction for this but increase that".

2. Simplified paperwork all around. One page tax form. Your w-2 (or equivilant for self employed, pensions, ect) and thats it. No saving endless receipts for deductions, amortizations, ect.

3. No need to pay for tax prep, accountants, storing tons of paperwork, or tax programs. They will scream bloody murder but hey I did not see much sympathy given for (example) buggy whip manufacters.

4. Catching cheats is dirt simple. If you earned total of 30,000 from 3 jobs but only paid in (example) 4,000 BUSTED.

5. IRS can be slimmed down with increasing effecency. You could downsize the IRS by easily 50% or more. How? No need to have all those people for help line, to print all those "official forms" you see by the thousands at the librarys that most get thrown away, no need to print all those tax form rulebooks, all those processors (simple form/ easiser to computer process), alot can be done on-line, less offices with the expences to run them, and reduction on the number of agents.
Enforcement becomes easier (along with compliance) as said in point 4. Less offices

Now although you have eliminated all the deductions/loopholes, reduced the overall rate to one low level, and eliminated income from estate/savings/ect you in the long run intake will skyrocket. Because you increase compliance due to simplicity, you make catching cheats easy/fast, eliminate money going out not compensated for (EIC), and everyone pays a set level.

The ONLY WAY IT WILL HAPPEN is when we all band together and put aside our individual greed/bias and use common sense in voting for representatives and HOLDING THEM TO THEIR WORD.

Now on to point two on hypocrisy of the liberals.

I find it funny in the main stream press, comments on ATS and protests like the OWS we hear ENDLESSLY about the 1%, evil corporations (both on lack of taxes and ourtsourcing), capitalism, and anybody rich with a Republican/conservative/tea party attached to their name.
We hear about GE, legal off shore accounts of romney, and how rich "need to pay more" at nausium in the press.

But strangely silent on Apple corporation, warren buffet, the kennedy family, the obama cabinate (who more than half INCLUDING THE HEAD OF THE IRS) who owed YEARS OF BACK TAXES/CHEATS, anyone in hollywood, union bosses,or anyone with a democrat (last I checked biden is rich)/liberal attached to their name.

In fact you hear or see on line at least once a week (and probably more) about GE but this is the FIRST ANYONE has pointed out beloved FB does THE SAME THING AS GE.

So I conclude that we need to hold EVERYBODY/COMPANY to the SAME STANDARD OF SCRUTINY and shame if necessary.

We need a flat tax to acomplish this.

Lasty we all need to stop acting like self-centered children and open our eyes to what ALL OUR POLITICIANS are doing. We need to hold them accountable IRREGARDLESS OF A D OR R IN FRONT OF THEIR NAMES. Judge them by WHAT THEY DO/DID not their words. Then keep them or get rid of them as necessary.

Untill be do the ONLY PEOPLE TO BLAME for what facebook has done (along with GE and others) is us.

Not the politicians, not the corporations, but the man/woman looking in the mirror.

Originally posted by links234

Originally posted by FatherStacks
But how can we hold their "feet to the fire" and get mega-companies like these to start paying their fair share? It's a nearly impossible task.

Ending the practice of single taxation for companies based in the US. What these tech companies are doing is basing their profit headquarters in Ireland (the highest tax rate for business' is 11%) because if you're taxed once by a foreign nation the US doesn't tax you again. This is how a three story building in the Cayman Islands can house 3,000 US companies at a 1% tax rate.

If you post losses and not profits then you can stand to get money back from the government, making your effective tax rate negative. If I had a lot more knowledge about it I'd have a lot more money, but that's the gist of it.

The simple way to stop this is in the US (cant speak or force another county to follow us nor should we) any money collected by sales/service/whatever is taxed at a flat rate (see my previous post on flat tax) IRREGARDLESS where "CORPORATE HEADQUARTERS" is.

The tax would be based on gross NOT NET.

Simple.

But wont happen because WE THE PEOPLE wont put aside our ME selfishness and see what the politicians are doing to us.

We rather believe that XX (pick your party affiliation) is helping me but everyone else /the opposing party is out out to get me.

We rather believe a political ad that makes a infomercial look honest and do more research on our next big screen tv than look at what the xx representative ACTUALLY DID. We rather hold our oil change guy responcible for what they did than see how our congressman affected our lives/what promises they kept.

In other words the cold hard truth is no matter what the corporations, the rich, or politicians did/didn't do the ONLY ONE TO BLAME is the one who voted for them, who keeps them in office, who buys their products.

In other words THE GUILTY PARTY IS LOOKING AT YOU IN THE MIRROR

Originally posted by WhereIsTheBatman
Dear mods,

I didn't know where exactly to put this subject. If needed, please move.

Facebook funnels its foreign profits into its Irish subsidiary. As the Guardian article explains: Facebook is structured so that companies buying advertisements on the website in the UK, or anywhere outside of the US, have to pay Facebook Ireland. As a result, Facebook manages to slash its taxes in other countries, paying, for example, $380,800 in British tax on estimated 2011 UK profits of $280 million, or a little over 0.1%. What is shocking is that Facebook paid so much Irish tax since it managed to convert its $1.3 billion gross profit into a net loss of $24 million.

[url=http://www.businessinsider.com/surprise-facebook-avoids-its-european-taxes-2012-12]

Well, if you wonder how the rich get even richer, this is part of the answer. Rich people have the money and means at their disposal to hire the best consultants. They know the gaps in the legal system and that's how profits are made.

The cost of hiring a few good consultants is peanuts compared to the benefits. The result is that their actions are technically legit. Just another example of how law and morals aren't the same thing at all.

In the mean while, the average Joe who bailed out the banks pays the full price.

edit on 29-12-2012 by WhereIsTheBatman because: typo

Their morals are totally legit. They have a professional, legal, and moral obligation to maximize the returns for their investors and shareholders. It's not their fault that idiotic masses of people vote in idiotic leaders that write idiotic tax laws.

This is one of the things Romney tried to explain but the MSM tried to destroy him for it. We keep raising taxes in the US and other countries will compete by lowering their corporate tax rates. This is why it's impossible to tax ourselves into prosperity. Corporations will simply leave.

Facebook in particular is nothing but software, servers, and databases. They would be idiots to pay any country a high tax rate if another country offered them a better deal.

Class warfare wins elections but isn't going to keep companies from leaving the US.

You don't need to pay a consultant. You know which countries have low tax rates. You just have to take intelligent action. How many thousands of hours were wasted on ATS while Zuckerberg was spending his hours creating and building Facebook?

The saddest part of this is that so many people spend their time whining and complaining about how unfair things are instead of using that same time and energy constructively.

As the government has told every ISP to block a popular torrent website, they should block Facebook's advertising services.