Submitted by giteam t3_y3txle in dataisbeautiful
amatulic t1_isaznz8 wrote
Looks like their tax rate went down.
dr_leo_marvin t1_isbptbl wrote
Yeah majorly down! From 70% to 16%. How is that possible? Good lawyers and knowledge of tax loopholes or policy changes?
Street-Individual292 t1_isdlb4x wrote
IPO years in general will be misleading because stock compensation isn’t tax deductible until it’s vested, which temporarily spikes effective tax rates. It doesn’t mean they’re actually paying that much, it’s just the way it’s recorded on financial statements
For reference, their tax rate was 36% in 2004
Ricksterdinium t1_isdwf62 wrote
Please add a reference if you're actually adding a reference.
ChrisFromIT t1_isbzinl wrote
Probably a bit of both.
Koopslovestogame t1_iscen3o wrote
Is the double Irish still a thing?
Edit: just checked myself and they said they’d stop doing it Jan 1 2020.
Street-Individual292 t1_isdlc9j wrote
Not for US companies
Koopslovestogame t1_isdv54j wrote
taps forehead “Irish company”
dr_leo_marvin t1_isdc942 wrote
Wut is that?
amatulic t1_isdegr9 wrote
It's a tax loophole. It's closed now. https://en.wikipedia.org/wiki/Double_Irish_arrangement
But companies moved on to other loopholes that are as good or better.
Street-Individual292 t1_isdlf5n wrote
>But companies moved on to other loopholes that are as good or better
I’d disagree with this. The whole point of changing our international tax laws back in 2018 was to establish a global minimum tax for US companies
onetwofive-threesir t1_isdwasl wrote
No it wasn't. The tax laws were changed to give companies "incentives" to return capital/jobs to the US (which we know they never do in the long term).
The tax law reduced our corporate taxes to their lowest levels in recent history. They also lowered the average person's taxes, but only temporarily (they will be rising over the next 5-6 years). And then they created new schemes, such as the business owner pass thrus. And I think they lowered the capital gains tax (don't quote me on that one).
The only somewhat positive thing they implemented was a one-time tax on corporate earnings overseas. This was used to help pay for some of the tax breaks they gave companies, but also offset the total cost of the bill. This encouraged the companies to repatriate their overseas earnings since they were going to be taxed anyways. Thought was, if they bring the money home, they'll invest in the US economy - except they said they wouldn't and then they didn't - they gave their shareholders dividend increases and stock buybacks...
Global minimum taxes were never on the table in 2017. That is a recent phenomenon...
Street-Individual292 t1_isep6p3 wrote
Pretty much everything that you said is true, but your last two sentences are wrong. The TCJA established two different minimum taxes on global income for corps. One is called GILTI and the other is called BEAT. GILTI is the framework for the global deal that countries are attempting to implement now, but the US has had this in place for 5 years now
beemccouch t1_iscjy3k wrote
And politicians voting to reduce taxes on corporations
Street-Individual292 t1_isdmzvy wrote
To be fair, 2003 is an extreme outlier year, as IPO years usually are. Google wasn’t actually paying 70% of their profit in tax
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