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by unabst 3610 days ago
Actually this is not as bad as most people assume. Companies should mostly re-invest, so should have no income. They should only have growth.

Taxing profit is taxing the reward (a delusion of money produced after all operations), which is what's suppose to justify it. But taxing growth is taxing the company itself (taxing the operations). Taxing shares or dividends would be taxing rewards.

Apple has generated a boatload of income tax and sales tax and capital gains tax, and these numbers are usually left out of corporate tax news pieces.

That said, Amazon being able to escape sales tax early was bad. Also individuals avoiding income tax through shell companies in tax havens is also bad. At least worse than global corporations escaping the US corporate tax...
2 comments
JoshTriplett 3610 days ago
> Amazon being able to escape sales tax early was bad.

They didn't "escape" it; states attempted to charge it for inter-state transactions, which they can't legally do in the absence of federal law allowing that. Amazon only became obligated to pay it when they started conducting intra-state commerce, which states are allowed to regulate and tax.

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sib 3610 days ago
"Amazon being able to escape sales tax early was bad" - they didn't escape it. In fact, they were following the law and acting exactly as traditional catalog retailers did; they charged sales tax to customers located in states in which Amazon has a physical presence. It only became a real political hot button issue when they started getting so big that they became a target.
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unabst 3610 days ago
Following the law doesn't make it not bad. Tax havens are legal and so are corporate tax loopholes. That's why they're holes, not crimes.

It was bad because 1) it was bad for small businesses that had to collect and had a hard time competing on price alone to begin with -- making it impossible to compete. And 2) because sales tax is a huge tax contribution which otherwise the government would have counted on.

And regarding escaping, it was an integral part of their business plan, and they fully intended to fight for it.

> the State of California agreed to a delay of one year before requiring online retailers to begin collecting sales tax on sales to California addresses (Read the whole part on California [1])

Worse yet, Amazon wasn't even profiting in the process. Making Jeff either Satan or a genius (you'll find plenty of stories proclaiming both).

Amazon created jobs and shareholder value. I'll give them that.

---- [1] https://en.wikipedia.org/wiki/Amazon_tax

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