After reading this article in today’s NYT detailing how things unfolded in the theater before, during and after the Hamilton performance on Friday evening, I’ve concluded the obvious: that the cast and crew members and the overwhelming number of audience members are paid, professional protesters.
Facebook founder and his wife have decided to give away 99% of their fortune. That is $ 45 billion.
Now, I know many will heap praise upon them for their generosity. Same deal when the Gates and Buffet did their give away announcement. But, I’m not so keen on this. I know, how heartless of me. How ungrateful.
Being grateful or not is my issue. Why, in an economy designed to make money from money, where labor has lost it’s power to assure proper distribution of the income earned from its productivity should I be heaping praise on those who are giving away massive amounts of money that was accumulated off the skewed economy put in place by those with the money to politically create this system?
Just how does them giving away money such that the masses have to in essence beg to get some of the benefit of such money provide equality in this economy?
If you are as cynical as I am, I know you are not surprised that Facebook paid Irish taxes (via Tax Justice Network) of about $4.64 million on its entire non-US profits of $1.344 billion for 2011.* This 0.3% tax rate is a bit below the normal, already low, Irish corporate income tax of 12.5%.
As with Apple, 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.
As you’ve no doubt figured out, it’s that “Double Irish” ploy again. Facebook operates a second subsidiary that is incorporated in Ireland but controlled in the Cayman Islands. This subsidiary owns Facebook Ireland, but the setup allows the two companies to be considered as one for U.S. tax purposes, but separate for Irish tax purposes. The Caymans-operated subsidiary owns the rights to use Facebook’s intellectual property outside the U.S., for which Facebook Ireland pays hefty royalties to use. This lets Facebook Ireland transfer the profits from low-tax Ireland to no-tax Cayman Islands. For more on the arcane mechanics, see Joseph Darby’s article “International Tax Planning,” downloadable at Wikipedia.
a £154m [$246.4 million] blitz on tax avoidance and evasion, with HMRC [the British equivalent of the IRS] hiring an extra 2,500 tax inspectors to target high earners who aggressively exploit loopholes to avoid or evade tax.
The U.S. should do the same.
* Dollar figures converted from pound sterling figures in the Guardian at an exchange rate of $1.60 per pound.
Cross-posted from Middle Class Political Economist.