[DoofusOfDeath]

I don't really understand the premise of these articles.

If an organization is working within the legal confines of the relevant tax systems, exactly what are they guilty of? Being the best possible stewards of their donations?

[trgv]

Universities are supposed to be morally upright. Even if they can't be prosecuted for this, it's still news that they're cheating.

Additionally, I think there's a really important difference between following the law and being a moral person (or a moral university, or a moral corporation). The law might approximate our conception of morality, but it doesn't cover it completely. There is an enormous grey area of activity that is legal, immoral, and newsworthy.

As an aside, perhaps one reason why there are so many "young people disenchanted with democracy" is your attitude: that a never-ending war between lawyers (looking for loopholes) and lawmakers (who should, in theory, be closing loopholes) is a feature. If that's a feature of democracy then maybe we should take another look at our options.

(I don't really feel that way. Well, sometimes I do, but on average I think democracy is the best we're going to get).

[ringaroundthetx]

Which moral argument are you subscribed to here again?

Did you read the article? The ICIJ notices that these are registered as charities in the states which means they are tax exempt except when the come across things that trigger UBIT. UBIT is an automatic 40% tax. University endowments are able to invest everywhere tax free, except when some debt financed transactions trigger UBIT for all tax exempt shareholders.

UBIT wasn't created to ensnare university endowments in scenarios where founders and board members of independent companies happened to get an exit through debt financing.

This is a circumstance where you adapt. Avoid that misapplication of tax by registering a business in another country and investing in the same thing through it.

[rorykoehler]

This raises another question. Is paying taxes inherently moral? Everywhere I look I see tax money being squandered with little to show for it.

[patall]

If it is so moral what they are doing, why don't they make the whole thing public by themselves. Its not like Universities need to hide anything (sorry for that paraphrase), they are public figures.

The thing is that we as a society have decided that we impose taxes in order to fund common things like protection, infrastructure etc. If now certain members of this society decide they do not want to pay their share anymore, they can say that publicly and we can all decide whether it is for the public good or not (and in the latter case, they can decide whether they want to leave the society in consequence). But what they are currently doing now is hiding that they do not contribute their share to our common good anymore and yes, that is amoral. Its acceptable (and anyones right) to have an opinion (about taxes) but I can expect you to be honest about it.

[rorykoehler]

I agree it's amoral but I'm not sure it's immoral.

[zaarn]

In America maybe. In Germany and other parts of Europe, tax money is not infrequently well spent.

[gaius]

If an organization is working within the legal confines of the relevant tax systems, exactly what are they guilty of?

It's a philosophical point about the sort of society you want to live in: one were most people do the right thing most of the time, just because it's the right thing, or one in which everyone must be continuously and intrusively monitored and regulated.

Here in England the Queen is implicated in the Paradise Papers. Now technically the Queen doesn't need to pay taxes at all, but even so, she still feels the need to cheat the system anyway. Given that the Head of State, (supposably) appointed by God as a role model for us all to rule by divine right doesn't see any need to contribute towards the NHS, schools, roads, police, the defence of the realm, etc, exactly what moral authority does anyone have to tell anyone to contribute their fair share? "A fish rots from the head down" is the saying, for good reason.

To apply this to universities they're basically saying if you can find a means to cheat in your exams that we haven't specifically banned, you can use it. Whereas I think most people would expect universities to be opposed to all cheating and also to educate their students that cheating is wrong...

[forapurpose]

Legality isn't the standard of behavior; it's just a minimum. Someone once said right here on HN: "Never forget, the holocaust was legal, slavery was legal, segregation was legal. If you use the state as a metric for ethics you'll end up disappointed." (It was so good, I wrote it down.)

This behavior isn't mass murder or oppression, but failing to pay your share of your communities/nation's bills - which puts more burden on your neighbors / fellow citizens - isn't acceptable to me. 'I can get away with it in court' isn't a good excuse.

[ThomPete]

Because the legality is set up so that it's only those who have a lot of money who can do this.

This is the problem.

I am all for not paying more taxes than necessary but it should be the same for everyone not just for the few with money to pay the lawyers and pay the fees.

[DoofusOfDeath]

Wouldn't that be an argument against the legislature, or perhaps lobbyists, rather than against the nonprofits stuck with the law?

[jiggunjer]

Indeed, taxes (or tax differences > 0) could be payable on income from overseas subsidiaries.

[ThomPete]

It's an answer to the question that was asked.

[burkaman]

Laws are limits, not instructions. You shouldn't drive exactly the speed limit when it's pouring rain.

[ryanlol]

>Because the legality is set up so that it's only those who have a lot of money who can do this.

The middle class can very well benefit from offshoring. It may not be for everyone, but it certainly isn’t only a thing for rich people.

[ThomPete]

It mostly is as you need to pay for lawyers or understand how to construct things.

It's not for the middle class. Upper middle class sure but not average middle class and it doesn't change the fact that it's not equal for all.

[hust6]

It's not a problem to me. If I have spent 30 years loosing blood, sweet and tears to gain advantage in an unfair world, I am going to defend that advantage.

Your view is unrealistic because you don't want that advantage, forget about doing anything to get it, and pretend people who have the advantage can be tamed. Like turning lions into deer.

Never going to happen.

[ThomPete]

I am not sure what view you referring to. I am not talking about what is realistic I am answering the parent.