> Starting Jan. 1, no companies will be allowed to set up a Double Irish scheme. Ireland also will phase it out through 2020 for companies that already have one, Noonan said.
I wonder if there will be a mad dash to set up corps in Ireland over the next few months.
They are phasing out the existing schemes, and as mentioned, five years is a very fast turn around for a country to make some big changes to its taxation law.
This makes me sad on so many levels. One, because it's sad that the US government has so much ability to force other sovereign entities to bend to its will, and two, because paying more taxes to the US government is never a good thing. I personally support anybody who finds new and creative ways to avoid sending tax dollars to the USG... after all, not everybody wants to fund the US's empire building overseas wars, torture camps, surveillance infrastructure, propaganda machine, and massive money-wasting bureaucracy.
> As we've always said, it's for governments to decide the law and for companies to comply with it
That is so fatalistic and depressing. Everybody should feel empowered to work to shape what "the law" is. Personally, I want society's notion of "the law" rolled back to just how Bastiat[1] defined it:
"What, then, is law? It is the collective organization of the individual right to lawful defense. "
I'm also reminded of what Bastiat said about lawful plunder and the perversion of the law:
But, generally, the law is made by one man or one class of men. And since law cannot operate without the sanction and support of a dominating force, this force must be entrusted to those who make the laws.
This fact, combined with the fatal tendency that exists in the heart of man to satisfy his wants with the least possible effort, explains the almost universal perversion of the law. Thus it is easy to understand how law, instead of checking injustice, becomes the invincible weapon of injustice. It is easy to understand why the law is used by the legislator to destroy in varying degrees among the rest of the people, their personal independence by slavery, their liberty by oppression, and their property by plunder. This is done for the benefit of the person who makes the law, and in proportion to the power that he holds.
Do you realize that Google, Facebook, Oracle et al. are US companies? These companies all benefited from the stable business climate that the US government largely provides(stable judicial system, Delaware Companies, a stable financial system, State University systems that provide research grants that made Google possible in first place etc.) So why should these Corporations that benefitted from that not pay their fare share of taxes? I hate pay taxes too but I pay them and I understand that they pay for services I benefit from. You sound both naive and uninformed. Its a farce that American companies that make billions pay almost no tax on those profits while us little people shoulder the burden. Did you actually read the article?
The "fair share" rhetoric so frequently deployed in these contexts would be more convincing if US corporate tax policy was more in line with international norms and if less tax revenue funded policies ranging from wasteful to downright immoral.
'Normalizing' taxes with the rest of the world would be a massive taxes increase on huge numbers of companies. We might have a high nominal rate, but companies can often get vary low effective tax rates. Arguably, what we need is a corporate AMT and a lower top tax bracket. Otherwise some companies focus on paying zero taxes where others simply focus on being profitable.
The average effective corporate tax rate is also quite a bit higher for the US than other developed countries; according to a report by PricewaterhouseCoopers and the World Bank, 27.9% versus an OECD average of 15.9%. [1 citing 2] The right wing think-tank AEI reported a smaller disparity of about 9% a few years earlier. [3] For what it's worth, these rates are fairly variable over the years.
So "huge numbers" seems like quite a stretch.
Moreover, I used the broader term "policies" rather than "rates" for a reason. The US's worldwide taxation scheme, for instance, is in itself problematic.
After examining 288 corporations that where consistently profitable every year for 5 years. On average they "paid an effective federal income tax rate of just 19.4 percent." Which is close to the "15.9 percent" you linked.
However, "Twenty-six of the corporations, including Boeing, General Electric, Priceline.com and Verizon, paid no federal income tax at all over the five year period. A third of the corporations (93) paid an effective
tax rate of less than ten percent over that period."
The point is with such high variability in tax rate's companies spend a lot of time looking for ways to avoid paying taxes vs. building better products etc.
> Arguably, what we need is a corporate AMT and a lower top tax bracket.
AMT is a farce created by people who don't understand math. Here's the simplest example: Suppose you have a company with a billion dollars in revenue and a billion dollars in expenses. It has no profit. It will pay no taxes. AMT will only cause it to fold because expenses + taxes now exceeds revenue. The same will be true of any company with net profit less than the minimum tax rate.
The same applies to personal income AMT, the only reason it hasn't imploded in on itself in the same way is that rich individuals typically have a higher percentage of "disposable income" than business entities, so instead the AMT "only" makes rich people donate less money to charity and other causes we considered sufficiently worthy to make tax deductible until the AMT decided to put them back on the same footing as yachts and caviar.
Fair share, there is no reason for your silly quotes, means that if an individual's marginal tax rate is 35% then a corporations should never be zero. There's nothing rhetorical about it. Where and how a government allocates that tax revenue is completely irrelevant to the responsibility of meeting ones tax obligations which are very clearly defined in the US tax code. You sound like a dingbat.
> Do you realize that Google, Facebook, Oracle et al. are US companies?
No! Really??? Tell me more!
> You sound both naive and uninformed
Maybe, but I'm pretty sure I've spent more time studying and thinking about these issue than you have, given how you are posting such a dismissive response with no actual substance to it.
> Did you actually read the article?
Well, let's see... I quoted a snippet directly from the article, and replied to it. So yeah, I think it's safe to say I read the article. Did you?
What's that got to do with Ireland? If the US believes it's entitled to taxes, then it should make that the law. I don't see how some third party county can modify local US law.
It isn't about the Republic of Ireland, it's about the US government and its excessive level of influence. My feelings would be the same if the other party had been Russia, Malaysia, Turkmenistan or Canada.
It's not like this is the first time the US has thrown its weight around in a way that's detrimental to individual freedom. Look, for example, at how they made the Swiss cave in on reporting financial transactions in a way that the Swiss historically never did.
I'm Irish (although I live in the US now) and I thought this scheme was a hideous national embarrassment. I don't care for my home country to be associated with accounting shenanigans. If corporations who find the US tax regime unfair spent as much energy on lobbying for an alternative as they do in playing financial find-the-lady then we might enjoy a simpler and fairer tax code in the US.
Also, I think your arguments about it being some sort of moral alternative to supporting the evil US government with tax dollars is patent nonsense. Ireland's motivations in offering this tax structure were purely mercenary; handing out subsidies in the form overly-generous tax treatment is an old-fashioned tactic that Irish governments have used many times in the past to attract foreign employers. On past form quite a few of those jobs will evaporate along with the expiration of the favorable tax treatment.
Ireland's motivations are irrelevant. I'm not taking issue with anything Ireland did, or didn't do. Again, this has nothing to do with Ireland per-se. What makes me sad is the way the US can seemingly dominate pretty much anybody (excepting maybe Russia and China, and I'm not even sure about that) and force other countries into following our policies.
Just to reiterate... I'd be sad about this if the other party involved had been any other country... Trans-Dniester, Sealand, Syria, Zimbabwe, whoever.
You still haven't presented any evidence for your claim that the US forced Ireland into abandoning this, and I'm inclined to think that you've let your imagination blind you to the facts.
The depth of Anarcho-Capitalist or strong Libertarian pessimism astounds me.
> because paying more taxes to the US government is never a good thing.
> not everybody wants to fund the US's empire building overseas wars, torture camps, surveillance infrastructure, propaganda machine, and massive money-wasting bureaucracy.
Do you really think this is what the bulk of our taxes in the US go to? What about taking care of our sick? Funding projects that are too risky for our current quarter to quarter ROI business culture? Keeping people from starving? Taking care of the disabled? Education? I could go on and on. Even our 'Imperial military' does a lot of humanitarian good across the world and responds to disasters like no other organization on Earth.
I'm not saying it is all sunshine and lollipops. Obviously there are things that I'd rather our government not do, but, when it comes to living in a Democratic Republic, sometimes you have to accept the will of the majority even if you don't agree with it. And sometimes there is enough room for bad actors to do things that range from unethical to appalling. It is a process of constant reform. It always will be.
But calling for a dismantling, to toss away the collected, hard earned, wisdom of the last 250 years codified into laws and hundreds of years of Common Law before that because parts are lousy? Honestly, that just seems like a lazy approach. Not to mention an approach that lacks imagination when it comes to really mentally modelling what such a system would look like without resorting to near utopian wishful thinking.
I mean, really, laws, like sysadmins, are doing their job well when you hardly notice they are there. The stuff you are noticing is horrible, but it is just the surface oil slick on a much calmer and more important sea.
The depth of Anarcho-Capitalist or strong Libertarian pessimism astounds me.
I'm not sure how you concluded that the Anarcho-Capitalist position is a pessimistic one. I'd say it's exactly the opposite! We are the ones who are optimistic enough to believe that we don't need a huge government apparatus, collecting tax dollars at the end of a gun barrel, and using that money to fund aggressive use of force, in order to have a peaceful, just, and fair society.
From where I'm sitting, it looks like it's the bastardised modern-day "liberalism" that is so full of pessimism. These people think that we need widespread use of coercive force in order to have peace and justice. It's exactly what Bastiat was saying when he spoke about the law becoming a perversion of itself.
Obviously there are things that I'd rather our government not do, but, when it comes to living in a Democratic Republic, sometimes you have to accept the will of the majority even if you don't agree with it.
Well yeah, if you're outnumbered and outgunned and the majority show a propensity for violence. I'm reminded of the old saw:
"Democracy is two wolves and a sheep voting on what to have for lunch. Liberty is a well-armed sheep contesting the vote".
This is what this conversion always boils down to: use of force.
Here's the problem with that 'bedrock' you are standing on: the vast majority of us are not coerced at all. We've happily agreed to this system. Have you convinced yourself that we are all just to stupid to recognize some yolk that only people with your mindset can see? I feel silly that I feel the need to tell you this but we are not stupid and any justification you make for why people embrace a strong governmental structure that is predicated on most people being too dumb to know what is good for them is built on a flimsy foundation at best.
Think about it: how can people simultaneously be too dumb to do and see what is best for them under their current system but would be able to function just fine under if under a more pure market force dominated Anarcho-Capitalist framework?
I also don't understand the obsession with the market as rigidly defined by Anarcho-Capitalists. Not all human exchange that leads to the benefits of market forces needs to be done through currency and its near analogues. Democracy and Government operate under its own types of markets and mediums of exchange. People still act for their own best interests under those systems. I don't understand why they all have to be homogenized. Having diverse means of exchange seems more robust to me.
And the Anarcho-Capitalist idea of Liberty really only seems to function when there is one person in the world. As soon as there are two people and their Rights and Liberties come at odds, it is like starting from scratch every time. Who's Rights and Liberty trumps whos?
It is like deciding that all previous decisions are useless...humanity hasn't gotten as far as it has by starting over all of the time. Passing along and even codifying wisdom into effective systems, including government systems, is a big reason we, as a species, has been so successful. Yes, markets are a nice system too, but why limit ourselves to just one?
Have you convinced yourself that we are all just to stupid to recognize some yolk that only people with your mindset can see?
Of course not.
I also don't understand the obsession with the market as rigidly defined by Anarcho-Capitalists.
The anarcho-capitalist position doesn't define markets particularly rigidly at all. "voluntary exchange" is pretty much it. How much more liberal a definition are you looking for?
Not all human exchange that leads to the benefits of market forces needs to be done through currency and its near analogues.
Agreed. I'm not sure why you think that position is at odds with anything I've said though.
As soon as there are two people and their Rights and Liberties come at odds, it is like starting from scratch every time. Who's Rights and Liberty trumps whos?
Again, this is where the optimism comes in. I'm optimistic that most conflicts can be resolved peacefully. Where they can't, there isn't - at the end of the day - any way I can see to prevent someone from using superior force to vanquish someone who possesses less strength. But that doesn't mean that we should institutionalize the use of force as a routine part of how we conduct business with each other.
>The anarcho-capitalist position doesn't define markets particularly rigidly at all. "voluntary exchange" is pretty much it.
Then what about the exchange between the organization we call a State and the people?
For example: I am more than happy to exchange my freedom to commit violence and for others to commit violence against me in the course of doing business to a heavily regulated monopoly (the State) that is ultimately controlled by the people that constitute that State. That is one less worry I have with every other interaction I have in my life -- violence has been taken off the table except in the case of rules that I've agreed to live by. Seems like a very fair trade to me. I have already volunteered for that exchange.
Or how about the agreement that I pool my money with people from all different industries and backgrounds into a fund that we all decide to spend through our representatives that we've voted to appoint? This tends to mean that pool of money is used for the common benefit. I'm happy with that situation as well. It creates a collective power that would be hard to match in any less comprehensive scheme, and some problems call for that approach.
In short, I've agreed to exchange time and effort and some freedom of action (that I will never miss) to participate in a system that I think works and works well. This system does not use solely currency as a means for exchange but votes and persuasion. Granted, currency can be spent to nudge votes this way or that but there is no direct exchange.
I believe this is the right way to go and that not everything needs to be translated into exchanges of currency which, really, is the heart of my disagreement with anarcho-capitalism. Not everything must be exchangeable with currency. In fact, some things should be impossible to exchange, directly, with currency.
>Where they can't, there isn't - at the end of the day - any way I can see to prevent someone from using superior force to vanquish someone who possesses less strength. But that doesn't mean that we should institutionalize the use of force as a routine part of how we conduct business with each other.
Violence exists. The best we can do is manage it. Do you not see the contradiction that you would allow freedom of all associations except the one society's currently agreed on?
> Do you not see the contradiction that you would allow freedom of all associations except the one society's currently agreed on?
I think you're assuming something about my position that isn't accurate. But this is starting to drift way more off-topic than ever, and I find myself thinking that I shouldn't even have replied in this thread, since I'm generally in favor of less political discussion on HN. But sometimes I allow myself to get drawn into it.
Anyway, I'm happy to discuss this at length, as long as it's a civil discussion. I'd just rather do it in a different forum. If you're really interested in the rest of my response to this, shoot me an email or something and we can continue the discussion there. If not, I think I'll just stop here.
> Here's the problem with that 'bedrock' you are standing on: the vast majority of us are not coerced at all. We've happily agreed to this system.
Just like North Koreans are not coerced at all and they've happily agreed to that system.
> Think about it: how can people simultaneously be too dumb to do and see what is best for them under their current system but would be able to function just fine under if under a more pure market force dominated Anarcho-Capitalist framework?
Because we know North Koreans would do just fine with less coercion, and we extend that same 'less-coercion' line of thinking to everyone.
> Having diverse means of exchange seems more robust to me.
Why does the federal government then not allow for competing currencies to the dollar? Why can't my employer pay me in gold (although 2 or 3 states have legalized this now - I wonder why!)? Why does all currency exchange have to be homogenized?
You're speaking against ancap without actually having read any of its literature. I can tell by the silly arguments you're using, and the fact you can't see the propaganda you're fed.
I've read a bit of literature -- I don't know how canonical it was because it was stuff I was pointed to in the middle of chats like this one but I found most of it to be very 'happy path philosophy' which is to say it didn't stand up to much critical reasoning. It seemed like I needed to accept the conclusions before it made sense in any more than a toy world way. It was all also not very surprising. I never had a 'Oh, well now that makes sense' kind of moments.
As soon as I see that it may be worth my time, I'll have a look, but if the answer is 'well the market works well in this area it must work well in all areas' and 'we'll know it works when we try.' or 'some Norwegian clans 800 years ago tried it for 75 years and it worked great (ignoring the fact they had clan councils and chiefs that enforced common laws -- 'but they could chose to change clans!').
Anyway, as far as I can tell it is pretty weak sauce on the order of Objectivism. If you have a pointer to something remotely enlightening I'd like to see it. So far the proponents and the literature I've come across has been pretty hollow.
I don't know about your Norwegian example, and it might be because I'm ignorant of it; or you might be confusing it with Iceland 1200 years ago. If so, remember they had that system for 300 years (longer than the US has existed) and that they could not only choose which 'clan' they belonged to but also could literally buy seats in the law-making house. This makes it a voluntary (therefore, anarcho-capitalist) society.
I'd point you in the direction of any Austrian Economics literature. I don't come from any "objectivist" thinking as it seems to me most of it comes from fiction, which I don't read. But if you learn how wealth can be created from simple exchange between two people, that's the aha moment.
I'd recommend PraxGirl's Praxeology series on youtube, and Schiff's How an Economy Grows and Why it Crashes.
See here is an example of the 'everyone is stupid' mindset: I am pretty sure everyone on HN understands how wealth is created through exchange. That is Econ 101 stuff.
If that is the aha moment, you are many years too late.
I just don't agree that all human exchanges necessarily have to be translatable into currency. It seems unnecessarily limiting. I think it is perfectly acceptable for people to agree to systems where no currency or barter exchange is necessary. For example, buying seats in a law making house...how is that an improvement over a representative voting scheme that is not paid for?
2. Econ 101 is usually taught from a Keynesian point of view (if you study Keynes' life you'll find out how much he really knew about economics)
3. I'm talking about the stuff that starts at 5:50 here: https://www.youtube.com/watch?v=PgsS683F76M . If you understand that you can understand that from the selfish desires of two people to profit, they end up helping each other. This is something I believe Objectivism phrases another way and people have trouble understanding - Obama himself said "I don't know when they decided they wanted to make a virtue out of selfishness", which shows even the president doesn't understand this point.
So you probably haven't had your aha moment yet, as most people.
There are several of those epiphanies, though. Another one that you're due is realizing money is just an indirection for labor. It's proof that labor was performed usefully by someone else at some point in time. It's a concretization of capital so we can work a bunch and decide to utilize the capital earned at a later point in time. Which means any vilification of money is baseless as money is just a product that everyone collectively decided is acceptable in any direction of a given exchange. Money is a shortcut, it does not cause evil, and if we banned all currencies and precious things we'd still come up with tying knots on grass blades or something - anything to prove that some labor was done at some point, and to decouple the two sides of any exchange (1. selling something I have, 2. getting something I want). Again, I'd recommend the Praxeology videos linked above.
I wonder what other means of exchanging with other people you can think of that is not money and the desire to profit (praxeologically, feeling good about donating is a profit).
To your question as to how buying seats is an improvement... it's because it makes the process transparent. Today's seats are also for "sale" but it's a complicated path full of influence games to get to the point you can even "bid" (watch House of Cards to see what not implementing this Icelandic idea begets).
>Another one that you're due is realizing money is just an indirection for labor.
That doesn't imbue it with any special properties.
I am not vilifying money. Obviously it is a very useful medium of exchange. I just don't understand why it must be elevated to /universally/ useful medium of exchange.
>I wonder what other means of exchanging with other people you can think of that is not money.
Votes, for one. Favors. Time (that is not covered by labor such as Time Spent Cultivating Friendship or Mentorship). Kindness. Even most inter personal violence and ill intent. Extra-currency exchanges between people abound and it doesn't make sense in many cases to make them transferable by assigning some currency value to them.
If you think that, then you can't have read much communist literature.
Marx spent large parts of his life criticising the idea that this was easy, and criticising the idea of the "inherent goodness of human nature".
On the contrary, Marxism assumes that it is human nature to first of all satisfy our own basic needs. In the German Ideology, Marx made the point that if a socialist revolution were to happen in an under-developed economy (like say Russia, or China, or Cuba, or North Korea, or Vietnam at the times of their respective "revolutions"), then redistribution would only make want common, and the same class struggles would reassert themselves. It was Lenin who laid the groundwork for ignoring that central part of Marx' of theses - a part he kept repeating in various contexts throughout his life.
Because a vital part of Marxism is the idea that society moves through phases that are dictated by social and economic conditions for production, and which "traps" us all. Marx did not see the capitalist as evil, nor did he see the workers as good - he saw everyone as effectively being forced into roles they either lived up to or lost. E.g. a capitalist that failed to act like a capitalist would go bankrupt and enter the working classes.
It was not "inherent goodness" Marx expected to bring a socialist revolution, but the working classes rising up in anger as capitalisms focus on increased productivity eventually reaches a point where the way of further increasing productivity makes capitalism itself fail as it runs out of fresh markets to expand into, and turns inwards on itself, with wages and jobs eventually being the only thing to cut. Couple this with the expectation that the ruling classes will refuse to yield to popular demand, but instead will use the means of oppression available to them.
The only reason a socialist revolution is considered necessary by Marxists is the assumptions that humans are not "inherently good", or at least not "good enough". But nor are they evil: It is natural to want to keep what you have, and so natural for the ruling classes to resist.
> Produce as much as you can, take as much as you need, what could possibly go wrong?
>
> (Spoiler alert: pretty much everything)
Of course no system has ever attempted that kind of distribution, and Marx explicitly warned (e.g. in Critique of the Gotha Program) that this was a long range goal for an advanced, well developed communist society, and that in the intermediate stages leading up to a socialist revolution, and during socialism, he saw it as more realistic to aim for a gradual transformation of the modes of production and to gradually redistribute through changes to taxation and salaries and welfare systems - not some "free for all" overthrow of all existing structure. In fact this is a defining difference between Marxism and the various anarchist ideologies (which tends to advocate the immediate destruction of the state to various degrees)
Even Leninist and subsequent bastardisations of Marxism kept to this - in large part I suspect because it became a convenient excuse for the various party elites to keep the masses in check while they lived in luxury.
I remember when I was 20, and had just finished reading "Machinery of Freedom", intent on fixing all the glaringly obvious problems in society by applying a medicine of revolutionary libertarianism.
But you haven't grown up enough to avoid making appeals to authority in order to justify a moral high ground.
I remember when I was 20 and I believed that those that were older than me knew more than I did because they were grown ups. Then I learned knowing is hard work, lots of reading involved, and most people avoid the legwork and jump straight to the "I know better now that I'm a grown up" because few call them out on it.
The whole point of my comment was that I'm now more unsure of anything than I was when I was younger and more susceptible to appealingly simple solutions.
> We are the ones who are optimistic enough to believe that we don't need a huge government apparatus, collecting tax dollars at the end of a gun barrel, and using that money to fund aggressive use of force, in order to have a peaceful, just, and fair society.
And history has shown several times that such optimism is folly.
Europe might not be perfect, but government spending is overall much saner.
That's a hard to verify claim. Although the opposite is most certainly true - That a many other countries have a higher defence spending because of high US defence spending.
I wonder what UK, Germany etc promised to Ireland in exchange. The tax debate was strong since more than a decade and it was even stronger during the default of Ireland.
All talks before have failed - I cant imagine what EU had to promise to them to change their minds...
Not only did Ireland not default but it was strongarmed by the ecb into repaying loans foreign banks had made to irish banks.
The reason for this was to prevent 'contagion' ie to save the european banking system. Ireland was later given some assurances about being looked after for doing this which have so far not been backed up
This is unfortunate. Corporate taxation is double taxation in the first place, and silly. Corporate profits are already taxed (in the form of dividends/capital gains to shareholders, and income tax to employees), there is no reason to tax them twice. Further, Corporate taxes make up a pittance of the total revenue by the federal US government. America wastes too much time worrying over the relatively tiny amount of corporate tax dodging when it spends trillions elsewhere.
America would be much better off without corporate taxes.
Double taxation of corporate taxes exists in the US but it's not the case in every country. For example in Australia you get a personal tax credit for any corporate taxes that you pay.
This is the reason why a lot of people choose an LLC in the US.
S corps don't have double taxation either. Small companies where you would get tax credit shouldn't really pay much in corporate taxes since all the money goes to the owners at end of each year.
9% of the 2010 tax revenues is about 1.5% of the 2010 GDP. US capital gains taxes that year were about 0.3% of GDP, with a top tax rate of about 15%[1]. To make up the lost revenue from eliminating corporate taxes, you would need to raise the long term capital gains tax rate six-fold, to 90%.
As far as I know, public spending in the US is about 40% of GDP, which is in line with other countries like Canada and Norway, and higher than countries like Japan and Switzerland.
I believe you are confusing "expensive" and "inefficient". Medicare and Medicaid have the lowest overhead, lowest cost-per-patient, and more-or-less the highest customer satisfaction in the US healthcare system.
They are still hugely inefficient. The US spends more per capita on Medicare/Medicaid than the UK spends on the NHS and only covers a small fraction of the population instead of everyone.
Sorry for the fairly off-topic rant, but this is something I had on my chest for quite a while.
I love how, in the discussions around the NSA, nobody brings up the fact that American tax money are also used to pay for it (not to mention other shady shit going on in the US, like IRS, generalised police corruption, ridiculous military spending, etc). Wake the fuck up, people; you get irate when company X or Y doesn't go over the top to protect their users' privacy against the NSA, but totally disregard the actual problem of mass surveillance (and all the other "anti-terrorism" crap, that's been proven to work by the way). Things don't happen in a vacuum, NSA and PRISM didn't just magically appear, so let's at least start by naming names (I'll start, check out this fucking asshole: http://9to5mac.com/2014/10/13/fbi-apple-google-encryption-in...).
(For an eventual "uh, but what do you do about it, talking is easy, derpa derp", my day job is building (a|yet another) zero knowledge email service.)
Under GAAP (standard accounting practices) any profits become a liability in the form of shareholders' equity. When the shareholders sell, they're taxed on the profits. So it's a reasonable argument that taxing the profits are a form of double taxation.
I believe that's true in the US as well because there are a huge number of sole proprietorships and partnerships. However, the companies with shareholders tend to be much larger companies, so they still make up a very portion of the economy.
The argument I'm familiar with for corporate taxation is that it is the cost for limited liability and being its own legal entity.
You can just eliminate the corporate in the middle, and have all the profits, expenses and liabilities directly assigned to share holders. But no one wants the liabilities part. Dropping corporate tax is therefore "something" (limited liability) "for nothing".
I agree in principal, but unfortunately taxing dividends is a necessity in the defence against tax avoidance. Were the practice to be abolished I could see companies using this as yet another loophole; faciltiating avoidance of both corporate tax (siphoning all of their profits through dividends) and income tax (by making all employees minor shareholders).
Well, either the corporation is a separate legal person from its shareholders, in which case it should pay its taxes like everyone else, or it's not, in which case things like limited liability and the corporate veil have no foundation. Can't have it both ways. (Or shouldn't, anyway.)
I wonder if the refusal of other EU states to help with the banking crisis had something to do with Ireland's tax haven antics. Ireland got a worse deal than the other EU crisis countries.
The ECB bailed out the Irish to save the European banking system, and ultimately the Euro, that was exposed to Irish bad debt via loans made to Irish banks by other European banks. The bailout was in the form of loans at a punitive interest rate, even the IMF (also part of the bailout program), seemed kind in comparison.
Ultimately the ECB eased up when it become clear that Ireland was doing a sterling job of turning itself around, making heavy cuts and reforms in the process, but the growing impression I have of the EU is that the rules are for the little countries, when you look for example at the debt problems and flouting of the European Fiscal Compact by Italy and France presently.
The lack of solidarity throughout this financial crisis has been telling, and will leave lasting resentments (just ask your Greek, Irish, or Portuguese friends).
Well, Ireland took a bad deal from the ECB, nationalizing the bank imposion and imposing punishing austerity measures (executed with sterling enthusiasm as you say) instead of doing something like Iceland.
It's more Ireland bailing out the ECB, courtesy of hapless and/or corrupt political leadership.
I agree with you on the treatment of Ireland, and the subsequent criticism of the country over corporate tax issues, often implying that the country was implicit in this, was rubbing salt in the wounds. Those tax structures were in place long before the crisis.
I'm torn on whether Iceland's approach was better however (for them), time will tell.
Think about what default means: someone lent you money, and you never gave it back. Now think about that it terms of fairness.
Sure the bankers lent money and never got it back, but who gave the money to the banks in the first place? Lots of private individuals were hurt: http://en.wikipedia.org/wiki/Icesave_dispute
No clear-cut good/bad guys in this mess, lots of moral hazard.
If someone lends me counterfeit money, I don't have to give it back.
Banks don't lend real money, they act with the government to legally leverage their deposits and lend out leveraged money. This money is created in the books and did not come from production in the real economy.
If private individuals' deposits were hurt then all the more reason to arrest the bankers.
The moral hazard comes from government guarantees like FDIC that discourage banks from investing prudently.
Just FYI - as far as I understand it, the "double Irish" works because in the US you are tax-resident if you incorporate in the US, while in Ireland you are tax-resident if you do business in Ireland
So if you incorporate in Ireland but do your business in the US you are tax-resident nowhere, and naturally corporations exploit this
As someone who works in the tech sector in Ireland I personally think now is the right time to be closing this particular loophole. It has run its useful course. It has become a mechanism for huge profits to be shuffled around virtually untaxed by organisations with a scale large enough to employ teams simply to exploit it. It's not a realistic proposition for SMEs to manage the level of international complexity it involves, particularly when you include the Dutch sandwich. It's an unfair and unbalanced advantage to large multinationals.
I disagree with others that companies should not have to pay corporation tax. I don't believe it is double taxation. Corporation tax is not charged on employee income, thats an operational expense and the tax on income is paid by the employee relative to their own tax status. Also, tax on dividends is effectively a personal income tax. Dividend tax is not liable on dividends paid to other Irish resident companies, amongst many other sensible exemptions. Corporation tax is charged on the trading profit of a corporate entity, not its revenue. Also, it's worth pointing out that if a company has paid corporation tax in previous years in Ireland and then reports a loss they may be entitled to a refund.
A side note on FDI implications. Yes the "double Irish" has played a role but it's by no means the only reason large multinationals locate here. The new "Knowledge Box" structure in conjunction with our relatively low corporate tax rate of 12.5%, the tax credits for Research and Development related activities, our membership of the EU and Eurozone, the ability of companies to deal directly with the highest levels of government, the fact we natively speak English, the fact we're culturally similar to the US and UK, the fact we have a timezone which overlaps for at least part of the day with almost everywhere in the US and that we have a statistically young and educated workforce all contribute to attracting tech companies here. Thats before we even consider the efforts of the IDA (and Enterprise Ireland at a domestic level) who IMHO are superb national assets.
I think that if we can restructure our tax rules so that "Ireland Inc" gains even a fraction more revenue from the multinationals operating here whilst retaining our international competitiveness, then it's unquestionably the smart thing to do.
This is all just further fallout from Ireland's stance on the Lisbon treaty, which led Intel, HP, and Microsoft to close up shop within a month of each other.
I'm very glad the loophole is being closed, but I don't think Ireland's tech sector will ever recover.
This is news to me. Do you have references? Intel, MS and HP are all still present.
HP has downsized in Ireland in the past, Galway in particular, but that's a chain reaction from it being Digital, then Compaq. But they still have a presence there too.
Dell left Ireland, but I don't recall any connection being made with the Lisbon treaty vote at the time, and don't see much evidence in searches. I think it was more down to newly-joined Poland being cheaper.
92 comments
[ 3.0 ms ] story [ 149 ms ] threadI wonder if there will be a mad dash to set up corps in Ireland over the next few months.
> As we've always said, it's for governments to decide the law and for companies to comply with it
That is so fatalistic and depressing. Everybody should feel empowered to work to shape what "the law" is. Personally, I want society's notion of "the law" rolled back to just how Bastiat[1] defined it:
"What, then, is law? It is the collective organization of the individual right to lawful defense. "
I'm also reminded of what Bastiat said about lawful plunder and the perversion of the law:
But, generally, the law is made by one man or one class of men. And since law cannot operate without the sanction and support of a dominating force, this force must be entrusted to those who make the laws.
This fact, combined with the fatal tendency that exists in the heart of man to satisfy his wants with the least possible effort, explains the almost universal perversion of the law. Thus it is easy to understand how law, instead of checking injustice, becomes the invincible weapon of injustice. It is easy to understand why the law is used by the legislator to destroy in varying degrees among the rest of the people, their personal independence by slavery, their liberty by oppression, and their property by plunder. This is done for the benefit of the person who makes the law, and in proportion to the power that he holds.
[1]: http://bastiat.org/en/the_law.html
The average effective corporate tax rate is also quite a bit higher for the US than other developed countries; according to a report by PricewaterhouseCoopers and the World Bank, 27.9% versus an OECD average of 15.9%. [1 citing 2] The right wing think-tank AEI reported a smaller disparity of about 9% a few years earlier. [3] For what it's worth, these rates are fairly variable over the years.
So "huge numbers" seems like quite a stretch.
Moreover, I used the broader term "policies" rather than "rates" for a reason. The US's worldwide taxation scheme, for instance, is in itself problematic.
[1] http://barbwire.com/2014/10/15/analysis-are-us-corporate-tax...
[2] http://www.doingbusiness.org/~/media/GIAWB/Doing%20Business/...
[3] http://www.aei.org/article/economics/fiscal-policy/taxes/rep...
However, "Twenty-six of the corporations, including Boeing, General Electric, Priceline.com and Verizon, paid no federal income tax at all over the five year period. A third of the corporations (93) paid an effective tax rate of less than ten percent over that period."
The point is with such high variability in tax rate's companies spend a lot of time looking for ways to avoid paying taxes vs. building better products etc.
PS: Yea, just like the articles you linked this is also biased but the numbers are not made up. http://www.ctj.org/corporatetaxdodgers/sorrystateofcorptaxes...
AMT is a farce created by people who don't understand math. Here's the simplest example: Suppose you have a company with a billion dollars in revenue and a billion dollars in expenses. It has no profit. It will pay no taxes. AMT will only cause it to fold because expenses + taxes now exceeds revenue. The same will be true of any company with net profit less than the minimum tax rate.
The same applies to personal income AMT, the only reason it hasn't imploded in on itself in the same way is that rich individuals typically have a higher percentage of "disposable income" than business entities, so instead the AMT "only" makes rich people donate less money to charity and other causes we considered sufficiently worthy to make tax deductible until the AMT decided to put them back on the same footing as yachts and caviar.
Ok, just as soon as we tax the wealthy at the same rate as international norms.
No! Really??? Tell me more!
> You sound both naive and uninformed
Maybe, but I'm pretty sure I've spent more time studying and thinking about these issue than you have, given how you are posting such a dismissive response with no actual substance to it.
> Did you actually read the article?
Well, let's see... I quoted a snippet directly from the article, and replied to it. So yeah, I think it's safe to say I read the article. Did you?
We're all sovereign entities, and we all bend. I don't see why the Republic of Ireland should be any different.
That said, wasn't this more due to pressure from the EU, than the US?
It's not like this is the first time the US has thrown its weight around in a way that's detrimental to individual freedom. Look, for example, at how they made the Swiss cave in on reporting financial transactions in a way that the Swiss historically never did.
Also, I think your arguments about it being some sort of moral alternative to supporting the evil US government with tax dollars is patent nonsense. Ireland's motivations in offering this tax structure were purely mercenary; handing out subsidies in the form overly-generous tax treatment is an old-fashioned tactic that Irish governments have used many times in the past to attract foreign employers. On past form quite a few of those jobs will evaporate along with the expiration of the favorable tax treatment.
Just to reiterate... I'd be sad about this if the other party involved had been any other country... Trans-Dniester, Sealand, Syria, Zimbabwe, whoever.
It was other EU countries that were pissed off about it. As evidence, I give you the European Commission's official notification of EU treaty enforcement over the issue: http://ec.europa.eu/competition/state_aid/cases/253200/25320...
...but I'm sure you've got some theory about how the US made them do it, or something.
> because paying more taxes to the US government is never a good thing.
> not everybody wants to fund the US's empire building overseas wars, torture camps, surveillance infrastructure, propaganda machine, and massive money-wasting bureaucracy.
Do you really think this is what the bulk of our taxes in the US go to? What about taking care of our sick? Funding projects that are too risky for our current quarter to quarter ROI business culture? Keeping people from starving? Taking care of the disabled? Education? I could go on and on. Even our 'Imperial military' does a lot of humanitarian good across the world and responds to disasters like no other organization on Earth.
I'm not saying it is all sunshine and lollipops. Obviously there are things that I'd rather our government not do, but, when it comes to living in a Democratic Republic, sometimes you have to accept the will of the majority even if you don't agree with it. And sometimes there is enough room for bad actors to do things that range from unethical to appalling. It is a process of constant reform. It always will be.
But calling for a dismantling, to toss away the collected, hard earned, wisdom of the last 250 years codified into laws and hundreds of years of Common Law before that because parts are lousy? Honestly, that just seems like a lazy approach. Not to mention an approach that lacks imagination when it comes to really mentally modelling what such a system would look like without resorting to near utopian wishful thinking.
I mean, really, laws, like sysadmins, are doing their job well when you hardly notice they are there. The stuff you are noticing is horrible, but it is just the surface oil slick on a much calmer and more important sea.
I'm not sure how you concluded that the Anarcho-Capitalist position is a pessimistic one. I'd say it's exactly the opposite! We are the ones who are optimistic enough to believe that we don't need a huge government apparatus, collecting tax dollars at the end of a gun barrel, and using that money to fund aggressive use of force, in order to have a peaceful, just, and fair society.
From where I'm sitting, it looks like it's the bastardised modern-day "liberalism" that is so full of pessimism. These people think that we need widespread use of coercive force in order to have peace and justice. It's exactly what Bastiat was saying when he spoke about the law becoming a perversion of itself.
Obviously there are things that I'd rather our government not do, but, when it comes to living in a Democratic Republic, sometimes you have to accept the will of the majority even if you don't agree with it.
Well yeah, if you're outnumbered and outgunned and the majority show a propensity for violence. I'm reminded of the old saw:
"Democracy is two wolves and a sheep voting on what to have for lunch. Liberty is a well-armed sheep contesting the vote".
Here's the problem with that 'bedrock' you are standing on: the vast majority of us are not coerced at all. We've happily agreed to this system. Have you convinced yourself that we are all just to stupid to recognize some yolk that only people with your mindset can see? I feel silly that I feel the need to tell you this but we are not stupid and any justification you make for why people embrace a strong governmental structure that is predicated on most people being too dumb to know what is good for them is built on a flimsy foundation at best.
Think about it: how can people simultaneously be too dumb to do and see what is best for them under their current system but would be able to function just fine under if under a more pure market force dominated Anarcho-Capitalist framework?
I also don't understand the obsession with the market as rigidly defined by Anarcho-Capitalists. Not all human exchange that leads to the benefits of market forces needs to be done through currency and its near analogues. Democracy and Government operate under its own types of markets and mediums of exchange. People still act for their own best interests under those systems. I don't understand why they all have to be homogenized. Having diverse means of exchange seems more robust to me.
And the Anarcho-Capitalist idea of Liberty really only seems to function when there is one person in the world. As soon as there are two people and their Rights and Liberties come at odds, it is like starting from scratch every time. Who's Rights and Liberty trumps whos?
It is like deciding that all previous decisions are useless...humanity hasn't gotten as far as it has by starting over all of the time. Passing along and even codifying wisdom into effective systems, including government systems, is a big reason we, as a species, has been so successful. Yes, markets are a nice system too, but why limit ourselves to just one?
Of course not.
I also don't understand the obsession with the market as rigidly defined by Anarcho-Capitalists.
The anarcho-capitalist position doesn't define markets particularly rigidly at all. "voluntary exchange" is pretty much it. How much more liberal a definition are you looking for?
Not all human exchange that leads to the benefits of market forces needs to be done through currency and its near analogues.
Agreed. I'm not sure why you think that position is at odds with anything I've said though.
As soon as there are two people and their Rights and Liberties come at odds, it is like starting from scratch every time. Who's Rights and Liberty trumps whos?
Again, this is where the optimism comes in. I'm optimistic that most conflicts can be resolved peacefully. Where they can't, there isn't - at the end of the day - any way I can see to prevent someone from using superior force to vanquish someone who possesses less strength. But that doesn't mean that we should institutionalize the use of force as a routine part of how we conduct business with each other.
Then what about the exchange between the organization we call a State and the people?
For example: I am more than happy to exchange my freedom to commit violence and for others to commit violence against me in the course of doing business to a heavily regulated monopoly (the State) that is ultimately controlled by the people that constitute that State. That is one less worry I have with every other interaction I have in my life -- violence has been taken off the table except in the case of rules that I've agreed to live by. Seems like a very fair trade to me. I have already volunteered for that exchange.
Or how about the agreement that I pool my money with people from all different industries and backgrounds into a fund that we all decide to spend through our representatives that we've voted to appoint? This tends to mean that pool of money is used for the common benefit. I'm happy with that situation as well. It creates a collective power that would be hard to match in any less comprehensive scheme, and some problems call for that approach.
In short, I've agreed to exchange time and effort and some freedom of action (that I will never miss) to participate in a system that I think works and works well. This system does not use solely currency as a means for exchange but votes and persuasion. Granted, currency can be spent to nudge votes this way or that but there is no direct exchange.
I believe this is the right way to go and that not everything needs to be translated into exchanges of currency which, really, is the heart of my disagreement with anarcho-capitalism. Not everything must be exchangeable with currency. In fact, some things should be impossible to exchange, directly, with currency.
>Where they can't, there isn't - at the end of the day - any way I can see to prevent someone from using superior force to vanquish someone who possesses less strength. But that doesn't mean that we should institutionalize the use of force as a routine part of how we conduct business with each other.
Violence exists. The best we can do is manage it. Do you not see the contradiction that you would allow freedom of all associations except the one society's currently agreed on?
I think you're assuming something about my position that isn't accurate. But this is starting to drift way more off-topic than ever, and I find myself thinking that I shouldn't even have replied in this thread, since I'm generally in favor of less political discussion on HN. But sometimes I allow myself to get drawn into it.
Anyway, I'm happy to discuss this at length, as long as it's a civil discussion. I'd just rather do it in a different forum. If you're really interested in the rest of my response to this, shoot me an email or something and we can continue the discussion there. If not, I think I'll just stop here.
Just like North Koreans are not coerced at all and they've happily agreed to that system.
> Think about it: how can people simultaneously be too dumb to do and see what is best for them under their current system but would be able to function just fine under if under a more pure market force dominated Anarcho-Capitalist framework?
Because we know North Koreans would do just fine with less coercion, and we extend that same 'less-coercion' line of thinking to everyone.
> Having diverse means of exchange seems more robust to me.
Why does the federal government then not allow for competing currencies to the dollar? Why can't my employer pay me in gold (although 2 or 3 states have legalized this now - I wonder why!)? Why does all currency exchange have to be homogenized?
You're speaking against ancap without actually having read any of its literature. I can tell by the silly arguments you're using, and the fact you can't see the propaganda you're fed.
Get reading.
I've read a bit of literature -- I don't know how canonical it was because it was stuff I was pointed to in the middle of chats like this one but I found most of it to be very 'happy path philosophy' which is to say it didn't stand up to much critical reasoning. It seemed like I needed to accept the conclusions before it made sense in any more than a toy world way. It was all also not very surprising. I never had a 'Oh, well now that makes sense' kind of moments.
As soon as I see that it may be worth my time, I'll have a look, but if the answer is 'well the market works well in this area it must work well in all areas' and 'we'll know it works when we try.' or 'some Norwegian clans 800 years ago tried it for 75 years and it worked great (ignoring the fact they had clan councils and chiefs that enforced common laws -- 'but they could chose to change clans!').
Anyway, as far as I can tell it is pretty weak sauce on the order of Objectivism. If you have a pointer to something remotely enlightening I'd like to see it. So far the proponents and the literature I've come across has been pretty hollow.
I'd point you in the direction of any Austrian Economics literature. I don't come from any "objectivist" thinking as it seems to me most of it comes from fiction, which I don't read. But if you learn how wealth can be created from simple exchange between two people, that's the aha moment.
I'd recommend PraxGirl's Praxeology series on youtube, and Schiff's How an Economy Grows and Why it Crashes.
If that is the aha moment, you are many years too late.
I just don't agree that all human exchanges necessarily have to be translatable into currency. It seems unnecessarily limiting. I think it is perfectly acceptable for people to agree to systems where no currency or barter exchange is necessary. For example, buying seats in a law making house...how is that an improvement over a representative voting scheme that is not paid for?
2. Econ 101 is usually taught from a Keynesian point of view (if you study Keynes' life you'll find out how much he really knew about economics)
3. I'm talking about the stuff that starts at 5:50 here: https://www.youtube.com/watch?v=PgsS683F76M . If you understand that you can understand that from the selfish desires of two people to profit, they end up helping each other. This is something I believe Objectivism phrases another way and people have trouble understanding - Obama himself said "I don't know when they decided they wanted to make a virtue out of selfishness", which shows even the president doesn't understand this point.
So you probably haven't had your aha moment yet, as most people.
There are several of those epiphanies, though. Another one that you're due is realizing money is just an indirection for labor. It's proof that labor was performed usefully by someone else at some point in time. It's a concretization of capital so we can work a bunch and decide to utilize the capital earned at a later point in time. Which means any vilification of money is baseless as money is just a product that everyone collectively decided is acceptable in any direction of a given exchange. Money is a shortcut, it does not cause evil, and if we banned all currencies and precious things we'd still come up with tying knots on grass blades or something - anything to prove that some labor was done at some point, and to decouple the two sides of any exchange (1. selling something I have, 2. getting something I want). Again, I'd recommend the Praxeology videos linked above.
I wonder what other means of exchanging with other people you can think of that is not money and the desire to profit (praxeologically, feeling good about donating is a profit).
To your question as to how buying seats is an improvement... it's because it makes the process transparent. Today's seats are also for "sale" but it's a complicated path full of influence games to get to the point you can even "bid" (watch House of Cards to see what not implementing this Icelandic idea begets).
That doesn't imbue it with any special properties.
I am not vilifying money. Obviously it is a very useful medium of exchange. I just don't understand why it must be elevated to /universally/ useful medium of exchange.
>I wonder what other means of exchanging with other people you can think of that is not money.
Votes, for one. Favors. Time (that is not covered by labor such as Time Spent Cultivating Friendship or Mentorship). Kindness. Even most inter personal violence and ill intent. Extra-currency exchanges between people abound and it doesn't make sense in many cases to make them transferable by assigning some currency value to them.
Produce as much as you can, take as much as you need, what could possibly go wrong?
(Spoiler alert: pretty much everything)
Marx spent large parts of his life criticising the idea that this was easy, and criticising the idea of the "inherent goodness of human nature".
On the contrary, Marxism assumes that it is human nature to first of all satisfy our own basic needs. In the German Ideology, Marx made the point that if a socialist revolution were to happen in an under-developed economy (like say Russia, or China, or Cuba, or North Korea, or Vietnam at the times of their respective "revolutions"), then redistribution would only make want common, and the same class struggles would reassert themselves. It was Lenin who laid the groundwork for ignoring that central part of Marx' of theses - a part he kept repeating in various contexts throughout his life.
Because a vital part of Marxism is the idea that society moves through phases that are dictated by social and economic conditions for production, and which "traps" us all. Marx did not see the capitalist as evil, nor did he see the workers as good - he saw everyone as effectively being forced into roles they either lived up to or lost. E.g. a capitalist that failed to act like a capitalist would go bankrupt and enter the working classes.
It was not "inherent goodness" Marx expected to bring a socialist revolution, but the working classes rising up in anger as capitalisms focus on increased productivity eventually reaches a point where the way of further increasing productivity makes capitalism itself fail as it runs out of fresh markets to expand into, and turns inwards on itself, with wages and jobs eventually being the only thing to cut. Couple this with the expectation that the ruling classes will refuse to yield to popular demand, but instead will use the means of oppression available to them.
The only reason a socialist revolution is considered necessary by Marxists is the assumptions that humans are not "inherently good", or at least not "good enough". But nor are they evil: It is natural to want to keep what you have, and so natural for the ruling classes to resist.
> Produce as much as you can, take as much as you need, what could possibly go wrong? > > (Spoiler alert: pretty much everything)
Of course no system has ever attempted that kind of distribution, and Marx explicitly warned (e.g. in Critique of the Gotha Program) that this was a long range goal for an advanced, well developed communist society, and that in the intermediate stages leading up to a socialist revolution, and during socialism, he saw it as more realistic to aim for a gradual transformation of the modes of production and to gradually redistribute through changes to taxation and salaries and welfare systems - not some "free for all" overthrow of all existing structure. In fact this is a defining difference between Marxism and the various anarchist ideologies (which tends to advocate the immediate destruction of the state to various degrees)
Even Leninist and subsequent bastardisations of Marxism kept to this - in large part I suspect because it became a convenient excuse for the various party elites to keep the masses in check while they lived in luxury.
Happily, I have now grown up.
But you haven't grown up enough to avoid making appeals to authority in order to justify a moral high ground.
I remember when I was 20 and I believed that those that were older than me knew more than I did because they were grown ups. Then I learned knowing is hard work, lots of reading involved, and most people avoid the legwork and jump straight to the "I know better now that I'm a grown up" because few call them out on it.
Grow up.
The whole point of my comment was that I'm now more unsure of anything than I was when I was younger and more susceptible to appealingly simple solutions.
The world is incredibly grey.
Being unsure is excellent. Relying on maxims such as "simple solutions are wrong" is not.
Simple or complex, the only way to prove something wrong is by refuting it. For that you need reason. Maxims are not refutations.
And history has shown several times that such optimism is folly.
Europe might not be perfect, but government spending is overall much saner.
It's certainly not insignificant. Our defense spend is around 72% of our Medicare + Social Security spend.
All talks before have failed - I cant imagine what EU had to promise to them to change their minds...
America would be much better off without corporate taxes.
http://en.wikipedia.org/wiki/Dividend_tax#Arguments_against
This is the reason why a lot of people choose an LLC in the US.
9% of the 2010 tax revenues is about 1.5% of the 2010 GDP. US capital gains taxes that year were about 0.3% of GDP, with a top tax rate of about 15%[1]. To make up the lost revenue from eliminating corporate taxes, you would need to raise the long term capital gains tax rate six-fold, to 90%.
[1] http://www.forbes.com/sites/realspin/2013/09/09/to-raise-the...
Or we could just cut spending...
I love how, in the discussions around the NSA, nobody brings up the fact that American tax money are also used to pay for it (not to mention other shady shit going on in the US, like IRS, generalised police corruption, ridiculous military spending, etc). Wake the fuck up, people; you get irate when company X or Y doesn't go over the top to protect their users' privacy against the NSA, but totally disregard the actual problem of mass surveillance (and all the other "anti-terrorism" crap, that's been proven to work by the way). Things don't happen in a vacuum, NSA and PRISM didn't just magically appear, so let's at least start by naming names (I'll start, check out this fucking asshole: http://9to5mac.com/2014/10/13/fbi-apple-google-encryption-in...).
(For an eventual "uh, but what do you do about it, talking is easy, derpa derp", my day job is building (a|yet another) zero knowledge email service.)
A 0% corporate income tax rate would just allow unlimited tax deferment.
In 1952, 33% of the federal tax revenue came from corporate taxes.
This figure was down to about 10% in 2013.
So the corporations already have it very good.
http://www.cato.org/publications/commentary/ending-corporate...
employees' income - salaries - is expenses and thus excluded from profits, so there is no double taxation here.
You can just eliminate the corporate in the middle, and have all the profits, expenses and liabilities directly assigned to share holders. But no one wants the liabilities part. Dropping corporate tax is therefore "something" (limited liability) "for nothing".
Ultimately the ECB eased up when it become clear that Ireland was doing a sterling job of turning itself around, making heavy cuts and reforms in the process, but the growing impression I have of the EU is that the rules are for the little countries, when you look for example at the debt problems and flouting of the European Fiscal Compact by Italy and France presently.
The lack of solidarity throughout this financial crisis has been telling, and will leave lasting resentments (just ask your Greek, Irish, or Portuguese friends).
It's more Ireland bailing out the ECB, courtesy of hapless and/or corrupt political leadership.
Even the traditionally right-wing IMF turned around a while ago and has been consistently calling out Europe's austerity enthusiasm as damaging. See eg. http://www.washingtonpost.com/blogs/wonkblog/wp/2013/01/03/a...
Some in the austerity movement have since been parading Ireland as an example of the success of their receipe for some reason. But: http://www.nytimes.com/2014/01/11/opinion/irelands-rebound-i...
I'm torn on whether Iceland's approach was better however (for them), time will tell.
Whether it was "better" or "worse" is a discussion I'll leave to the consequentialists.
Sure the bankers lent money and never got it back, but who gave the money to the banks in the first place? Lots of private individuals were hurt: http://en.wikipedia.org/wiki/Icesave_dispute
No clear-cut good/bad guys in this mess, lots of moral hazard.
If someone lends me counterfeit money, I don't have to give it back.
Banks don't lend real money, they act with the government to legally leverage their deposits and lend out leveraged money. This money is created in the books and did not come from production in the real economy.
If private individuals' deposits were hurt then all the more reason to arrest the bankers.
The moral hazard comes from government guarantees like FDIC that discourage banks from investing prudently.
So if you incorporate in Ireland but do your business in the US you are tax-resident nowhere, and naturally corporations exploit this
I disagree with others that companies should not have to pay corporation tax. I don't believe it is double taxation. Corporation tax is not charged on employee income, thats an operational expense and the tax on income is paid by the employee relative to their own tax status. Also, tax on dividends is effectively a personal income tax. Dividend tax is not liable on dividends paid to other Irish resident companies, amongst many other sensible exemptions. Corporation tax is charged on the trading profit of a corporate entity, not its revenue. Also, it's worth pointing out that if a company has paid corporation tax in previous years in Ireland and then reports a loss they may be entitled to a refund.
A side note on FDI implications. Yes the "double Irish" has played a role but it's by no means the only reason large multinationals locate here. The new "Knowledge Box" structure in conjunction with our relatively low corporate tax rate of 12.5%, the tax credits for Research and Development related activities, our membership of the EU and Eurozone, the ability of companies to deal directly with the highest levels of government, the fact we natively speak English, the fact we're culturally similar to the US and UK, the fact we have a timezone which overlaps for at least part of the day with almost everywhere in the US and that we have a statistically young and educated workforce all contribute to attracting tech companies here. Thats before we even consider the efforts of the IDA (and Enterprise Ireland at a domestic level) who IMHO are superb national assets.
I think that if we can restructure our tax rules so that "Ireland Inc" gains even a fraction more revenue from the multinationals operating here whilst retaining our international competitiveness, then it's unquestionably the smart thing to do.
I'm very glad the loophole is being closed, but I don't think Ireland's tech sector will ever recover.
HP has downsized in Ireland in the past, Galway in particular, but that's a chain reaction from it being Digital, then Compaq. But they still have a presence there too.
Dell left Ireland, but I don't recall any connection being made with the Lisbon treaty vote at the time, and don't see much evidence in searches. I think it was more down to newly-joined Poland being cheaper.