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Thread: Corporate tax avoidance

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    Default Corporate tax avoidance

    Another major American corporation will be under senate scrutiny for avoiding taxes though an elaborate scheme to shift profits to lower tax countries.
    Caterpillar has been the subject of labor issues on this forum
    Here is just another example of the complex tax structure that allows big business to shift their burden to the middle class while rewarding their executive's with outrageous compensation.

    Caterpillar, the world’s largest maker of heavy machinery, has become the subject of a US Senate inquiry into allegations the company avoided taxes through a complex international structure, say people familiar with the matter.
    Caterpillar’s overall tax rate has fallen over the past 14 years, as more of its profits have been taxed outside the US. It paid an overall effective tax rate of 32 per cent in 1999, when its non-US activities accounted for 26 per cent of profits. In 2013, its overall tax rate was 25.7 per cent and its non-US activities accounted for 62 per cent of profits.
    The company’s tax strategies also came under the spotlight in a 2009 federal lawsuit. Caterpillar was accused by an employee of shifting profits overseas to inappropriately avoid billions of dollars in taxes, through complex structures in Switzerland, Luxembourg and Bermuda.
    Caterpillar faces US Senate tax inquiry - FT.com
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    Default Re: Corporate tax avoidance

    Doing what Corporate America does best!!!

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    Default Re: Corporate tax avoidance

    Caterpillar has avoided taxes !
    What a shock that any US based corporation would do that.

    Heavy equipment giant Caterpillar shifted $8 billion in profits to an offshore Swiss affiliate over the last decade, and avoided paying $2.4 billion in U.S. taxes, according to a new report from the Senate Permanent Subcommittee on Investigation.
    Starting in 1999, through 2012, Caterpillar paid PricewaterhouseCoopers more than $55 million to develop and implement a tax strategy built around redirecting to Switzerland its taxable profits from sales of Caterpillar-branded replacement parts, according to the report.
    Over the past 18 months, the subcommittee also has examined Apple, Microsoft and Hewlett-Packard—all defended their tax practices as legitimate.
    Caterpillar dodged paying $2.4 billion in taxes: Senate report

    Now the question is, what are they going to do about it ?
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    Default Re: Corporate tax avoidance

    The slow wheels in Washington are moving ... like I said, slowly.

    Caterpillar Inc. is about as American as you can get, except that these days it’s not, having been partially shuffled off to Switzerland. But it still must deal with the IRS, and the IRS isn’t happy with the heavy equipment maker. In fact, the IRS is trying to add $1 billion in taxes and penalties to the company’s 2007-2009 year.

    Many of the proposed adjustments evidently relate to the Swiss entity as well as to foreign tax credits. Caterpillar has said it is fighting the IRS. But Caterpillar faces other legal process too, including a grand jury subpoena requesting information about the movement of cash among U.S. and non-U.S. units. The company was in the Senate hot seat in 2014. A report by the Senate Permanent Subcommittee on Investigation said the company avoided $2.4 billion in U.S. taxes over 13 years by shifting profits to Switzerland.
    But let's be fair, it isn't just Caterpillar, it is whatever company that has profits to hide that does the same thing.


    Tax havens like Ireland are favored by global giants like Apple, Google, HP, Facebook and Twitter. In 2013, the Senate Permanent Subcommittee on Investigations said Apple avoided $9 billion in U.S. taxes in 2012 alone via offshore units with no tax home. Apple’s CEO Tim Cook testified it was nothing illegal. Calling it the “holy grail of tax avoidance,” Sen. Levin claimed that Apple saved billions by claiming companies registered in Ireland are not tax resident in any country.

    Even Facebook flipped more than $700 million to the Cayman Islands as part of a “Double Irish” tax reduction strategy. Google used the Double Irish and the Dutch Sandwich, saving billions in U.S. taxes. Global companies like Apple, Starbucks and Hewlett-Packard put income in foreign pockets in ways the IRS doesn’t like.
    Caterpillar's Terrible, Horrible, No Good, Very Bad Day - Forbes
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    Default Re: Corporate tax avoidance

    Kind of makes you disgusted to even buy American!

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    Default Re: Corporate tax avoidance

    The corporate tax codes are more confusing for corporations.. Our government wants to tax them on oversea sales that they have already been taxed on in the other country.... I can see why some of these companies do what they do... Do I believe it is right?? NO,but in all fairness there has to be another way that will not encourage these companies to hide profits.. I can remember reading an article about the nightmare professional ball players have when it comes to taxes... They have to file in every state they play in..

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    Default Re: Corporate tax avoidance

    Quote Originally Posted by crazy View Post
    The corporate tax codes are more confusing for corporations.. Our government wants to tax them on oversea sales that they have already been taxed on in the other country.... I can see why some of these companies do what they do... Do I believe it is right?? NO,but in all fairness there has to be another way that will not encourage these companies to hide profits.. I can remember reading an article about the nightmare professional ball players have when it comes to taxes... They have to file in every state they play in..
    Understand that.
    When I worked in Philadelphia I had to file a city wage tax return in order to get my partial refund so I could then afford to pay my New Jersey state income tax.
    Everybody has their hand out.
    It's just that the corporations can move those funds in some tax avoidance, smoke and mirror accounting scheme and can thumb their nose at you and I ... because we have to pay, they don't.
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    Default Re: Corporate tax avoidance

    I don't feel sorry for corporations in the least. How many times have I posted articles about companies that pay no taxes at all? GE comes to mind. No, they just do not have my sympathy. If I sell one lousy painting for under $100.00, I still have to pay taxes on it!

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    Default Re: Corporate tax avoidance

    At least this is good news for Peoria and for the citizens.

    After a two-year study that examined alternative locations, Caterpillar Inc. announced Friday that it will keep its global headquarters in Peoria and modernize its downtown complex in what it called a re-commitment to the city.

    The world's largest maker of construction and mining equipment, with $55 billion in annual sales and revenue, Caterpillar will expand and overhaul its headquarters with a three-tower building as its centerpiece, CEO Doug Oberhelman said.

    "Caterpillar will stay in Peoria," Oberhelman announced to a standing ovation of about 200 dignitaries at the company's downtown visitors center.
    Caterpillar staying put in Peoria, expanding headquarters

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    Default Re: Corporate tax avoidance

    Whether or not the gov takes their money won't matter one red cent in your life.

 

 
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