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Tech’s Tax Paradise

November 24, 2017
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By Joe Kukura : sfweekly – excerpt

Uber, Apple, and Facebook are still evading U.S. taxes on an epic scale, according to a trove of leaked financial documents called the Paradise Papers.

A recent hack of 13.4 million confidential banking documents shows that rampant corporate tax evasion hits close to home here in the Bay Area. The documents, known as the Paradise Papers, reveal how the local tech industry’s use of offshore tax shelters has only become more creative in the wake of recent government crackdowns.

Among other things, the Paradise Papers have exposed underhanded offshore tax maneuvers by more than 120 politicians worldwide, including President Donald Trump’s billionaire Commerce Secretary Wilbur Ross, and even the Queen of England. But they also show similar schemes are used by Uber, Apple, and Facebook.

It was German newspaper Süddeutsche Zeitung which first obtained the documents, that detail the secret dealings of Appleby, an offshore law firm. The documents are slowly being leaked by the International Consortium of Investigative Journalists, and a fresh batch of data was released on Friday.

SF Weekly sifted through it only to find the Bay Area’s biggest tech companies, like Apple, Facebook, and Uber, have all used Appleby to secretly funnel hundreds of billions in assets to offshore tax havens…

“The essence of oligarchy is that the billionaire class is never satisfied with what they have,” Sanders said on Twitter earlier this month. “They want more, no matter what impact their efforts have on working people.”… (more)

Tech disrupts more than it fixes, but the big tech giants are not alone in that regard. The Paradise Papers prove that many wealthy US institutions and popular international celebrities hide their wealth behind off-shore accounts, as exposed in the Paradise Papers.

RELATED:

GOP tax bills could shield multinationals’ future overseas profits

By Carolyn Lochhead : sfchroinicle

WASHINGTON — Silicon Valley multinationals such as Apple and Google that are already sheltering hundreds of billions of dollars in overseas tax havens may pay little or no U.S. tax on future overseas profits under legislation Republicans are racing to enact…

It’s been largely overlooked amid controversies over how the new tax bills would affect households, but a wholesale change in the way the federal government would tax foreign profits is at the core of the GOP tax overhaul that the House passed this month and the Senate could approve in its own version this week…

Clausing and other critics say there are better ways to fix the problem than to charge little or no tax on overseas profits. They say the proposed new system will only invite U.S. companies to move more cash offshore, because the rate on overseas profits in low- or non-taxing countries will still be much lower even than the new 20 percent U.S. corporate tax rate…

Both the House and Senate bills have complex provisions to try to prevent multinationals from gaming the system, supporters of the tax plans say. The Tax Foundation’s Eakins said these would make the tax havens less attractive by assessing a kind of minimum tax on corporations that shift paper profits to low-tax jurisdictions.

But Reed College’s Clausing disputes that, saying these provisions have been written in a way that will encourage even greater use of tax havens… (more)

 

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