GE utilizes tax holes

Posted: March 31, 2011 by wordoflegs in Uncategorized
There was a recent New York Times story written about how General Electric evades paying high government taxes.nI am not surprised about General Electric’s tax approach. I for one do not particularly mind GE’s approach. If GE was paying taxes, it would just be going down the tubes, on the basis that our government does not know how to spend our tax dollars. It does not surprise me that people are not up in arms about this. Many of the top companies participate in similar tax loopholes. Google has an office in Dublin, Ireland which is credited for 88% of Google’s $12.5 billion sales outside the United States; the money is then transferred from Dublin to Bermuda (a safe haven where the corporate tax rate is very low). “When a company in Europe, the Middle East or Africa purchases a search ad through Google, it sends the money to Google Ireland. The Irish government taxes corporate profits at 12.5%, but Google mostly escape that tax because its earnings don’t stay in the Dublin office” (Drucker 2010). This strategy is called a “Dutch Sandwich” or a “Double Irish.” Since 2007 this strategy has saved Google over $3.1 billion. Google is not the only company that does this Facebook (who sends their money to the Cayman Islands), Microsoft, and Oracle all have similar strategies. It is unfair to pin this strategy on just GE. GE, as can be seen by the aforementioned examples, is just one in a number of companies who participate in this act. I do not see an issue with it; sure they are taking billions of dollars out of the governments hands. However, I believe the government should show the people that they can spend tax dollars wisely and then maybe they can whine about getting jousted billions of dollars. On the topic of education, GE did donate $11 million to benefit various schools and $30 million dollars to New York City schools.
For some reason my link button was not working so I posted the link to the article below.
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