Caterpillar skirted $2.4 billion in taxes, Senate report says
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[url]http://www.washingtonpost.com/business/economy/caterpillar-skirted-24-billion-in-taxes-senate-report-says/2014/03/31/36d2bc3a-b8ee-11e3-899e-bb708e3539dd_story.html?tid=hpModule_79c38dfc-8691-11e2-9d71-f0feafdd1394[/url]
[quote]Industrial manufacturer Caterpillar shifted billions of dollars in profits from the United States to Switzerland over a decade to avoid paying $2.4 billion in U.S. taxes, according to a Senate report due out Tuesday.
The report from the Senate permanent subcommittee on investigations is the latest in a series of probes into multinational corporations, including Apple, Microsoft and Hewlett-Packard, accused of hiding portions of their global profits from taxation.[/quote]
This is the kind of shit I just really hate to see. All these rich conservatives are always blaming the poor for being leeches on society when in reality the monies they earn from their stock portfolios are linked to way way way more "leeching" on the system than anything.
Don't worry guys, it's all going to trickle down aaaaaany minute now. You just need to aid the condensation with a few more tax breaks.
Money inspires greed and wrong doing. Maybe not for everyone but when your making enough of it you want more. And what we have been seeing is a good amount of corporations who have dealings in the international market while being based here in the US shifting money else where to avoid tax.
At least that my take on the matter. Also the chances are you buy from a company that is doing the exact same thing as Caterpillar.
cocoons aren't as cheap as they used to be
lol, they make great diesel engines and heavy machinery, but they're run by cheating fuckwits. GG.
It may sound good to a lot of people but telling a company to "pay its fair share" isn't really that simple. A publicly traded company has obligations to maximize investor return, and one of the vehicles through which you maximize returns is taking advantage of what is allowed under tax law. If they wanted to get companies (pretty much everyone in the fortune 500, all tech companies, conglomerates, chemical producers, you name it) to repatriate cash holdings, congress would lower the repatriation rate so that the companies can move necessary money to reinvest in the states without exposing themselves to taxes that much such investments uneconomical. A company literally does nothing but expose themselves to more taxes unless they are planing on using that money in the US. As it goes, a lower rate on what cash is repatriated is better than a higher rate on money that never comes back.
There is almost certainly nothing illegal about any of this. Tax law does however need to be changed to accommodate moving cash over international boundaries without huge tax liabilities, which would help alleviate the issue.
Not only that, but I guarantee that if you do some research you'll find all kinds of massive tax breaks given to them in every state they've set up a factory. Every time a large corporation decides to expand, the (Republican) states line up at the door to grovel and offer breaks and sweetheart deals to build in their states. Caterpillar, and hundreds of corporations just like them, are dodging their fair share of taxes at every level. We wouldn't be running a deficit in this country if corporations and the wealthy actually paid the tax rates that are in the books.
[QUOTE=nintenman1;44416277]It may sound good to a lot of people but telling a company to "pay its fair share" isn't really that simple. A publicly traded company has obligations to maximize investor return, and one of the vehicles through which you maximize returns is taking advantage of what is allowed under tax law. If they wanted to get companies (pretty much everyone in the fortune 500, all tech companies, conglomerates, chemical producers, you name it) to repatriate cash holdings, congress would lower the repatriation rate so that the companies can move necessary money to reinvest in the states without exposing themselves to taxes that much such investments uneconomical. A company literally does nothing but expose themselves to more taxes unless they are planing on using that money in the US. As it goes, a lower rate on what cash is repatriated is better than a higher rate on money that never comes back.
There is almost certainly nothing illegal about any of this. Tax law does however need to be changed to accommodate moving cash over international boundaries without huge tax liabilities, which would help alleviate the issue.[/QUOTE]
I'm not exactly sure what you are trying to say, but here's what I see.
[quote=the article]At least 70 percent of the
replacement-parts business — manufacturing, warehousing and distribution — is housed in the United States. There are nearly 5,000 U.S. employees handling the manufacturing, and only 65 workers doing the same in Switzerland, according to the report.[/quote]
The majority of this companies business is here in the US. I'm no economist, but I think that the company should pay taxes at least on the percentage of business that they do here in the US. The article says that they made a deal with the Swiss for a 4% tax rate on their income, much lower than the percentage they would have paid here -- and why should the Swiss charge as much [B]they weren't responsible for the public burden of their employees[/B] such as health insurance and even road construction.
This whole thing smells like they just made a deal to move all their money there in exchange for a lower tax rate, shirking their responsibilities to the country that allowed them to become what they are. I'm not saying that their tax rate should be as high as it is, one of the highest in the country IIRC, but the tax rate is probably artificially inflated due to the fact that they weren't paying their fair share to begin with. If they only allow a small portion of their income to be taxed, of course their rate will be higher. I place the blame for this mess entirely on the CEOs and CFOs who made the decisions to do business this way, and that goes for every fortune 500 company if they really are all doing it.
[QUOTE=frozensoda;44416359]...[/QUOTE]
There is usually more to these things than it may seem on the surface. Reminds me of the thing a few years ago wherein GE pay 0 federal taxes.
It turned out the reason for that was because congress passed a law to allow all companies that spent over a certain amount ($500,000 I believe it was) on new equipment to write those costs off their federal income tax, in order to encourage investment in the manufacturing sector. They basically spent a ton of money retooling a number of factories to be more efficient, and when those costs where taken from taxable income the result was 0 tax.
Everyone was talking about how they cheated their taxes when really they were just taking advantage of the law(s) passed by congress to the letter.
In regard to caterpillar's sales, a fair amount of their manufacturing is in the US, but they have customers all over the world. These customers would then place an order through a dealer office located in that particular country (perhaps Switzerland in this case), and said taxes resulting from those sales would be filed in that country.
Anyways, whether or not people approve of what they are doing, they are certainly not breaking the law. There are massive teams of accountants and tax lawyers that make sure of this. "fair share" remains a misnomer, because it implies that any company (or individual) given the option will pay substantially more taxes even if they don't have to by law. This simply doesn't happen often (if ever), and I can't think of any examples offhand.
As I mentioned earlier the only real solution to this is to offer tax incentives to repatriate foreign money at a lower than normal rate, or permanently lower it.
I can't blame them for doing that when they ended up pocketing an extra 2.4 billion dollars, no company in their right mind would willingly expose themselves to taxes that aren't necessary by law.
[QUOTE=Amez;44416535]I can't blame them for doing that when they ended up pocketing an extra 2.4 billion dollars, no company in their right mind would willingly expose themselves to taxes that aren't necessary by law.[/QUOTE]
Exactly. The companies are playing by the rules after all. Its the laws themselves that need work.
we neocons now
[QUOTE=Demache;44416597]Exactly. The companies are playing by the rules after all. Its the laws themselves that need work.[/QUOTE]
If a company can do something to save money they will, they don't give a damn about anything but that dollar. Obviously they won't attempt to do something that if discovered would make them lose more, but evading tax through loopholes isn't one of them. As of right now they're legal, that's why they're called loopholes because they are technically legal. They need to plug those up if they want to do anything about it, but lobbyists will do everything in their power to prevent that.
Sad is that paying your honest and full taxes would probably make your company uncompetitive and ruin it. The system has to change, you can't chase individuals.
The Money-Hungry Caterpillar
Plug the loopholes, and move on.
Pfft only $2.4 B that's adorable
Boeing has $8.7 Billion in tax breaks.
[QUOTE=Phaselancer;44419879]Pfft only $2.4 B that's adorable
Boeing has $8.7 Billion in tax breaks.[/QUOTE]
Boeing does a lot in the science/aviation research field which is where a lot of tax breaks exist.
A tax break is not the same as skirting revenue
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