<story><title>Google Revenues Sheltered in No-Tax Bermuda Soar to $10 Billion</title><url>http://www.bloomberg.com/news/2012-12-10/google-revenues-sheltered-in-no-tax-bermuda-soar-to-10-billion.html</url><text></text></story><parent_chain><item><author>cryptoz</author><text>Maybe it&apos;s because I&apos;m young and don&apos;t have experience with large-scale tax problems, but I have struggled for years and still cannot understand why companies do this. Is it &lt;i&gt;truly&lt;/i&gt; in Google&apos;s interest to work towards the minimization of government capability wherever it is? To ensure that California roads are less taken care of? To ensure that any local public debt is increased rather than decreased? It doesn&apos;t make sense to me. Wouldn&apos;t a company &lt;i&gt;want&lt;/i&gt; to contribute its share of taxes to the government of where it is located, so that the quality of life is better for everyone there including the employees?&lt;p&gt;It seems to me that Google, especially being in California, is being...well, something close to evil by making sure they help out their local governments and people &lt;i&gt;as little as legally possible&lt;/i&gt;.&lt;p&gt;I understand that their profits are higher each quarter because of this. I understand that&apos;s what shareholders demand. But &lt;i&gt;why&lt;/i&gt;?! Can this attitude lead to anything except terrible news? I just don&apos;t get it.</text></item></parent_chain><comment><author>nikcub</author><text>Google pay taxes on all US income (not to mention payroll taxes, consumption taxes, etc.). There is a massive miscomprehension of these tax stories as they portray Google, Apple etc. avoiding all taxes when this is not the case. The income housed in Bermuda is from non-USA receipts, each of which have already passed through a local tax jurisdiction from wherever they were generated. They &lt;i&gt;are not&lt;/i&gt; avoiding any taxes.&lt;p&gt;The reason they are kept offshore is because if the funds were naturalized back in the USA they would be double-taxed. It is difficult to argue that Google should pay local taxes once where a product is sold and then pay taxes again on that same money when it is transferred back to the USA.&lt;p&gt;Many large corporations that hold large cash balances keep them offshore. Around 75% of Apple&apos;s large cash holdings are held offshore. They have already paid tax on that money. It is the US naturalization laws that are broken, and the perception that Google, Apple et al aren&apos;t paying taxes or somehow avoiding them.&lt;p&gt;The best thing the US Government could do would be to institute another repatriation tax holiday. There is precedent for it as happen in 2004. As much as a trillion dollars could make its way back into the US economy if a deal could be worked out - a private mini-stimulus that the economy of 2 years ago really needed.</text></comment>
<story><title>Google Revenues Sheltered in No-Tax Bermuda Soar to $10 Billion</title><url>http://www.bloomberg.com/news/2012-12-10/google-revenues-sheltered-in-no-tax-bermuda-soar-to-10-billion.html</url><text></text></story><parent_chain><item><author>cryptoz</author><text>Maybe it&apos;s because I&apos;m young and don&apos;t have experience with large-scale tax problems, but I have struggled for years and still cannot understand why companies do this. Is it &lt;i&gt;truly&lt;/i&gt; in Google&apos;s interest to work towards the minimization of government capability wherever it is? To ensure that California roads are less taken care of? To ensure that any local public debt is increased rather than decreased? It doesn&apos;t make sense to me. Wouldn&apos;t a company &lt;i&gt;want&lt;/i&gt; to contribute its share of taxes to the government of where it is located, so that the quality of life is better for everyone there including the employees?&lt;p&gt;It seems to me that Google, especially being in California, is being...well, something close to evil by making sure they help out their local governments and people &lt;i&gt;as little as legally possible&lt;/i&gt;.&lt;p&gt;I understand that their profits are higher each quarter because of this. I understand that&apos;s what shareholders demand. But &lt;i&gt;why&lt;/i&gt;?! Can this attitude lead to anything except terrible news? I just don&apos;t get it.</text></item></parent_chain><comment><author>rlpb</author><text>This strikes me as a tragedy of the commons. It&apos;s in everyone&apos;s individual interest (including corporations) to pay as little tax as possible.&lt;p&gt;Assuming that this is entirely legal, I don&apos;t see how this is a problem in Google&apos;s behaviour. If there is a problem, it is in the tax code, and the Government has sole responsibility for that.&lt;p&gt;Making tax codes simpler would make it easier to not leave loopholes, but politics always seems to drive it in the other direction. Perhaps the need to avoid this kind of situation can be a good force in keeping tax codes simpler.</text></comment>