Google's offshore tax strategy cut $3.1B in taxes

[True Earthling]

Do no evil...

Google, the owner of the world’s most popular search engine, uses a strategy that has gained favor among such companies as Facebook Inc. and Microsoft Corp. The method takes advantage of Irish tax law to legally shuttle profits into and out of subsidiaries there, largely escaping the country’s 12.5 percent income tax. (See an interactive graphic on Google’s tax strategy here.) The earnings wind up in island havens that levy no corporate income taxes at all. Companies that use the Double Irish arrangement avoid taxes at home and abroad as the U.S. government struggles to close a projected $1.4 trillion budget gap and European Union countries face a collective projected deficit of 868 billion euros.

Google, the third-largest U.S. technology company by market capitalization, hasn’t been accused of breaking tax laws. “Google’s practices are very similar to those at countless other global companies operating across a wide range of industries,” said Jane Penner, a spokeswoman for the Mountain View, California-based company. Penner declined to address the particulars of its tax strategies.

Google is “flying a banner of doing no evil, and then they’re perpetrating evil under our noses,” said Abraham J. Briloff, a professor emeritus of accounting at Baruch College in New York who has examined Google’s tax disclosures. “Who is it that paid for the underlying concept on which they built these billions of dollars of revenues?” Briloff said. “It was paid for by the United States citizenry.”

http://goo.gl/xjCT

[leveymg]

1. MNCs have been using Ireland as a tax dodge for years. For instance, the U.S. IT companies

claim to have invested $6.8 billion in Ireland last year but only $191 million in India. Ireland has only 74,000 IT workers compared with 2.2 million Indians who work in that sector.

Even weirder, Commerce Dept figures for US Foreign Direct Investment in Chinese IT almost exactly balance out Chinese FDI in the US, but there is another $6 billion U.S. IT multinationals invest in Hong Kong, which has a miniscule IT workforce compared to China's.

Something doesn't add up here, and what I have concluded is happening is that the U.S.-based multinationals have been shifting funds around in effort to avoid taxation and to obscure the full extent of their own offshoring.

The U.S. is being literally defrauded in several ways by its own giant corporations, which are currently sitting on $1.8 Trillion in cash and retained earnings, most of it in offshore accounts. If the U.S. part of those profits were reinvested in the U.S., everybody would be back to work tomorrow.

[donheld]

2. k & R

[Progressive_In_NC]

3. In the US, large corps simply pay no taxes.....

It's amazing, and google claims to be progressive too. So much for their fair share.