No to Bangalore, Yes to Buffalo

[blzrul]

There's a point

[KD in CA]

Sounds great. Can we presume the Obama plan will allow entrepreneurs the ability to create those jobs without the labor union albatross forced on them?

[Chef Jim]

Hey Kelly, it's that alliteration thing again. God he gives great speeches.

[blzrul]

Sounds great. Can we presume the Obama plan will allow entrepreneurs the ability to create those jobs without the labor union albatross forced on them?

Last I knew, employees had to vote on whether to unionize. It has nothing to do with a president.

[finknottle]

Last I knew, employees had to vote on whether to unionize. It has nothing to do with a president.

 

If the left gets it's way, they won't even have to do that. It will be enough for a community organizer to hand in something with sufficient purported signatures on it.

[finknottle]

There is not much discussion about the foreign policy angle here. Isn't it supposed to be important that the US show a kinder, gentler face to the world so that they'll like us again? How does slamming Bangalore help? Or does India not count because they are - you know - not cool like Western Europe?

[Chef Jim]

There is not much discussion about the foreign policy angle here. Isn't it supposed to be important that the US show a kinder, gentler face to the world so that they'll like us again? How does slamming Bangalore help? Or does India not count because they are - you know - not cool like Western Europe?

 

No, no, no, no, no. He's not slamming Bagalore he's slamming the US and our greedy companies.

[KD in CA]

Last I knew, employees had to vote on whether to unionize. It has nothing to do with a president.

 

I guess you missed the "entrepreneurs" part of that question. You know, the people who would actually PAY all those would-be Buffalo employees. Too bad they don't have a say in the matter.

 

 

And it has everything to do with politicians who force employers to accept unions under the threat of fiscal abuse and/or prison.

[Kelly the Dog]

Hey Kelly, it's that alliteration thing again. God he gives great speeches.

 

 

You're finally seeing the light.

[Kelly the Dog]

I would actually like someone who knows to explain to me why there are some people saying these US multi-national companies are "double taxed", and some people are saying they are only taxed what the US taxes them.

 

I won't say I know either way, but it seems to me it's a semantic argument. They are taxed twice, but for the same amount. In other words, they are taxed for the US amount MINUS what they have to pay to the other countries. So how is that being double taxed other than having to fill out two forms? What am I missing? If you have to pay 36 or 39% to the US, AND you have to pay 15% to the host country, but you get that exact 15% deducted from your US taxes, why is that being double taxed? The money you pay is exactly the same either way, right?

 

Again, I am looking for clarification only, not taking sides on whether or not it is a good idea.

[Chef Jim]

I would actually like someone who knows to explain to me why there are some people saying these US multi-national companies are "double taxed", and some people are saying they are only taxed what the US taxes them.

 

I won't say I know either way, but it seems to me it's a semantic argument. They are taxed twice, but for the same amount. In other words, they are taxed for the US amount MINUS what they have to pay to the other countries. So how is that being double taxed other than having to fill out two forms? What am I missing? If you have to pay 36 or 39% to the US, AND you have to pay 15% to the host country, but you get that exact 15% deducted from your US taxes, why is that being double taxed? The money you pay is exactly the same either way, right?

 

Again, I am looking for clarification only, not taking sides on whether or not it is a good idea.

 

I don't think it is an issue of double taxation as much as an issue of tax deferral. As long as the money stays outside the US they can defer the taxes on those outside the US earnings. See it's that incentive to grow thing again. You grow your company, become global, provide products to other countries and we'll give you tax break here. Now how does that benefit this country? First it benefits Americans who invest in those compaines and the growth will create jobs here as well as abroad.

[Kelly the Dog]

I don't think it is an issue of double taxation as much as an issue of tax deferral. As long as the money stays outside the US they can defer the taxes on those outside the US earnings. See it's that incentive to grow thing again. You grow your company, become global, provide products to other countries and we'll give you tax break here. Now how does that benefit this country? First it benefits Americans who invest in those compaines and the growth will create jobs here as well as abroad.

 

And the administration is now saying that on monies generated OUTSIDE the U.S., that you have to pay taxes on it now, at the U.S. rate, and can no longer defer?

 

What is the rationale for being able to defer in the first place? If you are making this money and banking it now, why shouldn't you pay taxes on it now?

[finknottle]

I would actually like someone who knows to explain to me why there are some people saying these US multi-national companies are "double taxed", and some people are saying they are only taxed what the US taxes them.

 

I won't say I know either way, but it seems to me it's a semantic argument. They are taxed twice, but for the same amount. In other words, they are taxed for the US amount MINUS what they have to pay to the other countries. So how is that being double taxed other than having to fill out two forms? What am I missing? If you have to pay 36 or 39% to the US, AND you have to pay 15% to the host country, but you get that exact 15% deducted from your US taxes, why is that being double taxed? The money you pay is exactly the same either way, right?

 

Again, I am looking for clarification only, not taking sides on whether or not it is a good idea.

 

I believe you are correct - it is not double taxation. Foreign taxes paid are a tax credit when calculating US taxes.

 

And, btw, that is why you hear the oft-cited figure that US companies pay an effective tax rate of only 4% on overseas operations. That actually means that our taxes are on average 4% higher, effectively leaving only that difference to be paid after the foreign tax has been accounted for. We do the same to foreign companies operating here - they have to pay US taxes first, and it is up to their government to collect any difference. (Which there usually isn't since our taxes tend to be higher.)

[blzrul]

I guess you missed the "entrepreneurs" part of that question. You know, the people who would actually PAY all those would-be Buffalo employees. Too bad they don't have a say in the matter.

 

 

And it has everything to do with politicians who force employers to accept unions under the threat of fiscal abuse and/or prison.

Well somehow when I think "entrepreneur" I think "small business" which is actually a large part of the backbone of America and unless you define a small business as having thousands of employees, I don't think there are union issues there. Depending on your industry, SMB is typically 50 employees or less.

[Chef Jim]

And the administration is now saying that on monies generated OUTSIDE the U.S., that you have to pay taxes on it now, at the U.S. rate, and can no longer defer?

 

What is the rationale for being able to defer in the first place? If you are making this money and banking it now, why shouldn't you pay taxes on it now?

 

It's outside the US. Why should they pay taxes on money that they have not even brought into the country. It's my understanding that Obama wants to tax them on it even if it's outside unless they bring their jobs back to the US. I'm being very general here, but that sounds like extortion to me.

 

The ability to defer the taxes now gives them more operating capital because they have more cash to the bottom line. There are accounting people here that know a lot more about this than I do but that's what it looks like to me.

[finknottle]

And the administration is now saying that on monies generated OUTSIDE the U.S., that you have to pay taxes on it now, at the U.S. rate, and can no longer defer?

 

What is the rationale for being able to defer in the first place? If you are making this money and banking it now, why shouldn't you pay taxes on it now?

 

Yes. The key misunderstanding may revolve around 'banking it' - I don't think that is what is going on.

 

I believe the rationale has to do with how best to capitalize a foreign subsidiary for a better return later. Taxes need not be paid on the profits of an overseas operation untill you actually start drawing money from it back into the US. So if you are notb 'banking it,' you don't get taxed yet. In that respect, it is analogous to buying a stock and not paying taxes on the market gain untill you sell.

[finknottle]

Well somehow when I think "entrepreneur" I think "small business" which is actually a large part of the backbone of America and unless you define a small business as having thousands of employees, I don't think there are union issues there. Depending on your industry, SMB is typically 50 employees or less.

 

I believe the Federal Government considers a small business to be 200 employees or less (and there's a revenue ceiling too, something like $50 million).

[Kelly the Dog]

Yes. The key misunderstanding may revolve around 'banking it' - I don't think that is what is going on.

 

I believe the rationale has to do with how best to capitalize a foreign subsidiary for a better return later. Taxes need not be paid on the profits of an overseas operation untill you actually start drawing money from it back into the US. So if you are notb 'banking it,' you don't get taxed yet. In that respect, it is analogous to buying a stock and not paying taxes on the market gain untill you sell.

 

Thanks. That doesn't seem right or very fair then, IF they are not banking it now. But if they are just using it to pass around money between their varied businesses as a loophole to avoid paying taxes then I don't see a problem with it. On the surface, if what you are saying is true, it seems like a mistake.

[Kelly the Dog]

It's outside the US. Why should they pay taxes on money that they have not even brought into the country. It's my understanding that Obama wants to tax them on it even if it's outside unless they bring their jobs back to the US. I'm being very general here, but that sounds like extortion to me.

That doesn't seem fair to me either. I agree.

 

I do think we could get a lot of friggin' millions if not billions back from companies cheating and stashing cash in other countries just to avoid taxes they rightfully owe. And I applaud the efforts of this administration for going after them. This, however, seems wrong and wrongheaded.

[blzrul]

I believe the Federal Government considers a small business to be 200 employees or less (and there's a revenue ceiling too, something like $50 million).

Well the business I run is more than $50m quarterly and there are 15 of us.

 

None are union.