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We make laws. We have police, and tax authorities. Google finance said google made $40.42bn. The rate is 25%. Gives us $10.1bn.

Your post is very insightful. The only thing I’d add is that when you have a $10 billion tax bill that you can afford to pay $5 billion to attorneys and accountants to avoid it.

That’s the crux of the problem to me. No matter what scheme the government can come up with to tax it, the numbers are so large that it is in the company’s interest and ability to find loopholes. That’s why we end up with sophisticated shell companies shuffling money around in tax havens that are perfectly legal but don’t make sense outside of tax avoidance schemes.

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when you have a $10 billion tax bill that you can afford to pay $5 billion to attorneys and accountants to avoid it.

I personally think this is overstated as a root cause. Giant corporations have the same lawyer budget to spend avoiding payroll taxes or GSTs/VATs, but it doesn't make that kind of difference. That's because salaries, sales and value adds are, in practical terms, objective truths. The law & accounting standards define them, locate them to a jurisdiction and that definition is defensible. A transaction either is or isn't a salary, or a sale.

Profit otoh, is subjective. Expenses can be expressed as investments, retained earnings can be expressed as growth. Most importantly, profit doesn't have an objective location.