
Amazon paid no US income taxes for 2017 - mkeeter
https://www.sfgate.com/business/tech/article/Amazon-paid-no-US-income-taxes-for-2017-12713961.php
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BraveNewCurency
Let's say Amazon is about to make $1B in profits. Instead, they go on a hiring
spree, and quickly pay out $1B in salary. Ha ha, they say, we have a profit of
$0, so we don't get taxed!

But that's good. The employees all made lots of money (and will be taxed on
it, often at a higher rate than the corporation would have paid!)

So run the same scenario again, but this time say "stock options" instead of
salary.

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ksec
If they spend it on their HQ2, let say it is $2B, do they wipe of the $1
Profits this year, ( Paid no tax ), and Net Operating Loss of $1B, which get
deducted next year. Assuming they make the same $1B profits next year, that is
No Tax again right?

One of the problem I see is that many companies buy Asset like property asset
to avoid taxes.

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matt_wulfeck
Theres an important distinction in deferring taxes versus avoiding taxes.
Every time they buy a peice of property there’s taxes on the sale. Every year
there’s property taxes (very high in WA), then finally there’s a sale and
guess what?

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ksec
Sorry it was a hypothetical question, didnt know there is property tax in US.

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omarforgotpwd
I haven't looked into Amazon's finances extensively, but I bet this is at
least partly due to Net Operating Loss. In US tax law net operating loss means
that you can deduct losses for prior years from this year's earnings. The
funny thing about this is that by losing money you actually add an asset to
your balance sheet (deferred tax assets). Since Amazon has lost a lot of money
in the past that probably helped with their 2017 taxes. Another interesting
thing about this is with the new tax law cutting the corporate tax rate to
21%, many companies had to take a charge against earnings in order to write
down the value of the deferred tax assets. If you lost $1M last year, you had
$350,000 in deferred tax assets that got written down to $210,000 meaning your
company technically lost $140,000, even though you got a tax cut. Accounting
is truly amazing.

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IanDrake
I wonder if journalists will ever tire of writing disingenuous articles like
this.

The uninitiated in business will understand this as another company
contributing nothing to the tax base, but they’re intentionally leaving out
the other side of the equation.

The money deducted from employees exercising option grants doesn’t go into a
black hole. It simply shifts the tax burden to the employee.

The real story is money never escapes the tax man. The burden may shift, but
Amazon is creating wealth and the recipients of that wealth are paying taxes.

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smt88
If you're saying that the real headline should be "Amazon shifts 100% of its
tax burden to its employees," then I think you'd still have a story that would
make some readers angry.

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cheald
This isn't exactly new, though. Incidence of corporate taxes - not just Amazon
- is already well-understood to primarily fall on labor.

[https://www.kansascityfed.org/Publicat/RegionalRWP/RRWP07-01...](https://www.kansascityfed.org/Publicat/RegionalRWP/RRWP07-01.pdf)

[https://www.treasury.gov/resource-center/tax-policy/tax-
anal...](https://www.treasury.gov/resource-center/tax-policy/tax-
analysis/Documents/WP-101.pdf)

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dvasdekis
I want to believe in this hypothesis, because the case for land taxes has long
been rejected due to the perception that they unfairly penalise 'mom and pop'.
If corporate taxes do end up simply being a tax on labour, then taxes that
don't have the same potential for manipulation can be put in their place.

However, two PDFs alone isn't sufficient proof for me. Has a broad meta-study
of both sides of the argument been done?

