That you cannot think of such an argument doesn't mean much. That such possible arguments wouldn't obtain "legitimacy" in your mind explains far more about your conception of the role of business in society. There are no optional taxes—any company that actively seeks ways to avoid taxes is not dealing justly or ethically with the society in which it exists. The same goes for citizens. A healthy and just society cannot exist when its citizens, and their corporations, seek to enjoy all the benefits of citizenship and the services provided, but simultaneously work diligently to avoid upholding their end of the arrangement to support and perpetuate a healthy and just society.
You are free to overpay on your taxes as well. I assume based on your reasoning that you give the government your entire income minus expenses.
Governments have the ability to levy taxes. If they need money they should levy a tax. It's that simple. There is no 'right amount' that a company should be paying that is more than the law requires them to pay.
Except there's a difference between overpaying and short term tax minimisation.
I, for instance, in my country, am relatively conservative on my tax returns. I do not push everything out to the point of maximal complexity & maximal returns.
The reason I do this is twofold. If my accountant makes a mistake or a bad call, I am still personally liable for the tax I didn't pay + penalties, even though I sought and obtained professional advice. I know of cases now where people have received "audit shocks" where it turns out the government disagrees with how far they're pushing things, and now they owe money + penalties. Increase that sting and those penalties and watch the risk/return equation change.
The other two reasons are: I pay to support local community and infrastructure. I don't mind paying a bit extra to support public transport in my area, for instance, so if I can find a way to make targeted contributions (as opposed, say, my money going to a contractor in Iraq), then I'll put a bit more in.
And the third reason I don't pay minimal taxes it's a form of social contract/political insurance. I know that if I'm a total prick, or want to do things in the future, if I haven't paid my share, or if someone wants to audit me and go through my books as a political game or to make a point, I have far more political capital and support from the population of I show I'm a good citizen vs "I basically will fuck you all to the maximum extent and screw you". This also provides me a clean conscience, legitimacy, authenticity, and general good will.
Plus if anyone does audit me, for political reasons or otherwise, maybe I'll get a small refund or ruling in my favour, which, at such times, I could really use...
I would love to give all my income minus expenses. I could easily make it so I have zero after my expenses. But that's not how things work for individuals... and that's a large part of the difference.
>I would love to give all my income minus expenses. I could easily make it so I have zero after my expenses. But that's not how things work for individuals...
Of course that's how it works. There is nothing that stops you from donating extra to the government. If you really wanted to you could easily do it.
No, your comment quite clearly implies that the corporations should not utilize the tax laws to pay the minimum required amount of taxes. You use words like 'avoid' to imply that it's evasion, but it's 'avoiding' in the same way as someone who 'avoids' taxes by taking a deduction for a dependent.
No, you've misread and inserted your own ideas as what I meant. The comment I replied to used 'avoid' in describing 'optional taxes'. I reused the word in disagreeing with the notion there are optional taxes, particularly as these allegedly optional taxes were suggested as taxes a corporation took action specifically to avoid.
[Edit]: Moreover, you still fail to address how I've suggested any notion of right amounts or paying more than the law requires. I have not. Since the comment I replied to used 'avoid', and you think avoid implies evading taxes, then you seem to assert I should understand the GP to be saying optional taxes are those taxes a company can take action to evade. This is even more problematic.
The effort a corporation expends to avoid taxes, such as those under scrutiny in the matter at hand, are not at all homologous to electing to take a dependent exemption for an individual citizen. Reducing one's tax bill via deductions and elected credits is not the same as going to great lengths to create special structures that enable a corporation to avoid tax bills altogether.
> The effort a corporation expends to avoid taxes, such as those under scrutiny in the matter at hand, are not at all homologous to electing to take a dependent exemption for an individual citizen. Reducing one's tax bill via deductions and elected credits is not the same as going to great lengths to create special structures that enable a corporation to avoid tax bills altogether.
You've said it's not the same. How is it different? Both ways of reducing tax burden are things that the laws permit, and that have been established as lawful from much precedent.
What is lawful != what is ethical. Most of my comments in this thread and on this subject engage the ethical responsibilities of citizens and corporations to their societies, and their parts in the establishment and perpetuation of just and healthy societies.
Beyond that, there is quite an orders of magnitude difference between electing to take an individual deduction as a citizen and establishing complicated structural entities specifically to avoid or reduce taxes by increasing the complexity of determining tax obligation. If you do not see these things are different, I doubt I could convince you otherwise.
>If you do not see these things are different, I doubt I could convince you otherwise.
If you can't articulate why they are different, then perhaps the distinction isn't as clear as you seem to think.
Why do you think a person incorporates a small business instead of operating as a sole proprietor? Why do you think small businesses save all kinds of receipts and pay accountants to ensure they are maximizing expenses?
Who says I can't articulate the difference? You seem to be incapable of avoiding jumping to some seriously erroneous conclusions throughout our exchange here. I most certainly can articulate the difference, and have succinctly done so more than once while reiterating what specifically I am targeting with my comments—a target you continue to ignore and brush aside. You seem to want to argue. I see no indication that writing hundreds of more words will move the needle of this discussion. You make assertions and ask questions that are wholly divorced from my point, and seem to somehow entirely miss the point of every statement I've made.
For your edification, I run a business. I do not pursue complicated measures or hire accountants to minimize or avoid taxation, maximize expenses, or anything similar. I practice what I preach, as the saying goes. And such behavior is entirely counter to everything I'm saying is important here.
Drawling on with small examples that seem obvious to you is worthless. It's not articulating anything, it's only proving the point that there is no real distinction other than one method of paying the legally required amount of taxes feeling more icky to you than another.
Is your line in the sand the involvement of accountants or lawyers? Any publicly traded company needs both of those anyway even if they have extremely boring returns. So what is it that draws the line for you?
I'm interested to hear your opinion on this, but you've got to actually explain, not merely state differences and conclusions.
> Who says I can't articulate the difference?
The comments have not included one so far. What you've said is that one thing is not the same as another, but you have not included an explanation of what difference you see there as being, or how that difference leads to one thing being moral and the other immoral.
> What is lawful != what is ethical.
> The effort a corporation expends to avoid taxes, such as those under scrutiny in the matter at hand, are not at all homologous to electing to take a dependent exemption for an individual citizen.
> Reducing one's tax bill via deductions and elected credits is not the same as going to great lengths to create special structures that enable a corporation to avoid tax bills altogether.
You've said they're not the same, but you haven't explained what the differences are, why the differences are significant to this discussion, and how the differences should support your analysis of the morality. Your comments leave it to the reader to infer what the differences are between one thing or another, and draw conclusions from them that support your point.
I read your comments as expressing the point, "These things are not the same, and one of them is immoral, and if you don't agree with me already then I don't see the point of explaining." It's fine if you want to hold that opinion. However, someone wrote a comment disagreeing with that point of view, and you've attempted to rebut it. People write comments on HN because they like to analyze and understand, but your comments don't include more than a pure opinion on your part that one of these behaviors is wrong without saying why. It's not very constructive to share an opinion without being willing to explain why you think it, especially given that you responded to people who sought to discuss it.
I think a strong argument was made against your point. I will restate it: "Governments have the ability to levy taxes. If they need money they should levy a tax. It's that simple. There is no 'right amount' that a company should be paying that is more than the law requires them to pay."
I think that's a pretty good point - don't you? What is your argument for why companies should pay more tax than they're required to pay? You seem to believe that there's some morally correct amount of tax that companies are morally obligated to pay, other than the amount specified by law, but you haven't provided a justification for why that is so, or for determining what that amount is. You have just said that corporate tax avoidance is different (in an unstated way) from individual tax avoidance. Even if we agreed that they're different in many significant ways, the morality or immorality of tax avoidance does not automatically follow from recognition of differences.
You could articulate your point better by starting with, "It's immoral for corporations to seek to lower their tax burden because..." and then follow up by explaining, "It's still moral for individuals and sole proprietors to seek to lower their tax burden because ... " It would illustrate the issue much better to explain what the essential difference is, and why that difference leads to it being immoral. What are the criteria for tax avoidance in an organization or company to be immoral?
You're entitled to your opinion (even if expressed in an insulting way, as you did here), and I'm certain that there are ways for you to maximize your personal tax bill to help satisfy the social responsibility that you feel others have. Lead by doing. However, I don't think you'll find tax maximization strategies in use at any major corporation, now or at any time in the future, and I'd expect shareholder lawsuits if they were ever utilized.
You, like your sibling respondent, appear to be replying to things I have not said. No suggestion was made for maximizing taxes or overpaying.
Also, I didn't express myself in an insulting way. You've edited this comment a few times now, and it's cool to just stick with the actual topic. I made no insults.
"That you cannot think of such an argument doesn't mean much. That such possible arguments wouldn't obtain "legitimacy" in your mind explains far more about your conception of the role of business in society."
