[rad-green] New Analysis Details 'Aggressive' Tax D odging of Six Silicon Valley Giants—Totaling Over $10 0 Billion

*https://www.commondreams.org/news/2019/12/02/new-analysis-details-aggressive-tax-dodging-six-silicon-valley-giants-totaling-over
<https://www.commondreams.org/news/2019/12/02/new-analysis-details-aggressive-tax-dodging-six-silicon-valley-giants-totaling-over>Common
Dreams          December 2, 2019New Analysis Details 'Aggressive' Tax
Dodging of Six Silicon Valley Giants—Totaling Over $100 BillionAmong the
tech companies studied, Amazon "stands out as the business with the poorest
tax conduct," according to the U.K.-based Fair Tax Mark.by Jessica Corbett,
staff writer*

[image: Amazon]

*Close-up of sign with logo on facade of the regional headquarters of
e-commerce company Amazon in the Silicon Valley town of Sunnyvale,
California, Oct. 28, 2018. (Photo: Smith Collection/Gado/Getty Images)*

Amazon, Apple, Facebook, Google, Microsoft, and Netflix have collectively
dodged over $100 billion in global taxes so far this decade, according to
an analysis released Monday by a U.K.-based tax transparency campaign group.

Later this week, the Fair Tax Mark plans to publish its full report on the
tax conduct of the companies, entitled *The Silicon Six and Their $100
Billion Global Tax Gap*. The report's key findings were  detailed
<https://fairtaxmark.net/tax-gap-of-silicon-six-over-100-billion-so-far-this-decade/>
on
the group's website Monday.

"Our analysis of the long-run effective tax rate of the Silicon Valley Six
over the decade to date has found that there is a significant difference
between the cash taxes paid and both the headline rate of tax and, more
significantly, the reported current tax provisions," said the Fair Tax Mark
chief executive Paul Monaghan. "We conclude that the corporation tax paid
has been much lower than is commonly understood."

The Fair Tax Mark studied each company's annual filings in the United
States—where the tech giants are incorporated—as well as some quarterly
filings and accounts of subsidiaries over the period of 2010–2019. The
group found that the collective global tax gap between the expected
headline rates and the cash taxes paid was $155.3 billion. The gap between
the current tax provisions and cash taxes was $100.2 billion.

"The report suggests that the bulk of the shortfall almost certainly arose
outside the United States, given that the foreign current tax charge was
just 8.4% of identified foreign profits," the group explained. "Profits
continue to be shifted to tax havens, especially Bermuda, Ireland,
Luxembourg, and the Netherlands."

The Fair Tax Mark determined that Amazon, whose CEO Jeff Bezos is the
richest <https://www.forbes.com/billionaires/list/;> individual in the
world, "stands out as the business with the poorest tax conduct" among the
Silicon Six. The headline corporate tax rate in the U.S. was 35% for most
of the years studied, but the group found that Amazon paid only $3.4
billion in income taxes—just 12.7% of profit—during the analyzed period.

"The company is growing its market domination across the globe on the back
of revenues that are largely untaxed, and can unfairly undercut local
businesses that take a more responsible approach," the group said, warning
that "the situation is unlikely to reverse soon."

*The Guardian* reported
<https://www.theguardian.com/business/2019/dec/02/new-study-deems-amazon-worst-for-aggressive-tax-avoidance>
that
Amazon pushed back against the findings, saying that the report's
"suggestions are wrong" and the company had "a 24% effective tax rate on
profits from 2010–2018."

Facebook ranked as the second-worst offender, having paid just 10.2% of its
profit. Google, whose cash tax paid as a percentage of profit was 15.8%,
came in third. Netflix, in the fourth spot, "proved to be the most
difficult to rank," and had the same cash tax percentage as Google.

Facebook told *The Guardian* that "we take our tax obligations seriously
and pay what we owe in every market we operate. In 2018 we paid $3.8bn in
corporation tax globally and our effective tax rate over the last five
years is more than 20%."

"When multinational corporations abuse their tax responsibilities to
society, they weaken the supports that our economies need to work well and
create wealth."
—Alex Cobham, Tax Justice Network

Apple ranked fifth. The Fair Tax Mark pointed out that although Apple
"presents itself as 'the world's largest taxpayer' and it certainly makes
the largest tax contribution of the Silicon Six," the company's cash tax
paid as a percentage of profit was still just 17.1%.

"Microsoft, by a slim margin, has the least aggressive approach to tax
avoidance of the six," the tax group concluded. Microsoft was co-founded by
the world's second-richest
<https://www.forbes.com/billionaires/list/;> individual,
Bill Gates, and "makes the second largest tax contribution of the Silicon
Six," according to the analysis. The company's cash tax paid as a
percentage of profit was 16.8%.

The Fair Tax Mark's Monaghan said Monday that "the international tide is
turning on the acceptability of corporate tax avoidance. The idea of
countering the profit-shifting of Big Tech multinationals via the
introduction of digital sales taxes has taken root in many countries."

Monaghan noted that the Organization for Economic Cooperation and
Development (OECD) "is now leading multilateral efforts to address the tax
challenges from digitalization of the economy, and is looking to ensure
that profitable multinationals pay tax wherever they have significant
consumer-facing activities and generate their profits."

Alex Cobham, chief executive of the London-based advocacy group Tax Justice
Network, said that the group's new report "demonstrates why we need a
fundamental reprogramming of the world's approach to tax, based on a
unitary taxation."

Under a unitary taxation system
<https://www.taxjustice.net/topics/corporate-tax/taxing-corporations/>, the
global profits of multinational corporations would be allocated across the
countries where the companies actually conduct business, which advocates
argue would effectively make tax havens useless.

"When multinational corporations abuse their tax responsibilities to
society, they weaken the supports that our economies need to work well and
create wealth," said Cobham. "A unitary approach to tax means we can
finally make sure multinational corporations contribute tax based on where
they employ workers and do business, not where they rent mailboxes and hide
ledgers."

"By ensuring multinational corporations pay their fair share locally for
the wealth created locally by people's work—based on an agreed formula and
supplemented by a minimum effective tax rate—governments can strengthen
their economies to run smoothly and make a good life possible for
everyone," he added.

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