Microsoft admits to dodging $29B in taxes. Yes, billion with a B.

[thx1139]

Baalzamon said:

Viper1 said:

A.  Actually, it does get used.  Indirectly.  They can use it for collateral.  This reduces the cost of borrowing and/or opens new lines of credit.  And offshore accounts doesn't mean it is being spent in the country the money was earned in.  I doubt that they had $93 in revenue from the Cayman Islands or Switzerland.  And it's probably drawing a nice interst too.

B. Again, they aren't keeping and or spending the money in the country it was earned in.  It's in a bank, drawing interest.

C. So if they bring money back into the US...no taxes on it?

A. To a degree it could be used for collateral, but they would still have to pay tax on it if they brought it back and had to actually use it as collateral. It doesn't have to mean it is spent in the country it was earned. The taxes were already paid to the country it was earned, there would just be additional taxes, above and beyond what was already paid, if it was brought back to the United States

B. Again, it doesn't have to stay in that country. They already paid that country their taxes. But they would certainly be stupid to bring it back to the US, and pay additional taxes, if they can instead just spend it elsewhere and not be liable for those additional taxes

C. It has been something lobbied for years. There is literally over $1 trillion overseas that companies will NOT bring back to the US, because the US refuses to allow them to bring it back without issuing additional taxes (above and beyond the taxes they already paid the country in which it was earned). I personally think it would be a huge boost to the economy (and thus bring more tax revenue to the government even though it was not collected on the initial amount).

There was a repatriation holiday on 2004. It didnt do anything for the economy.   Just padded CEO pockets.