Microsoft, Apple cough up millioins after Australian tax audits Nice work if you can get it: Microsoft has told Australia's Senate committee into Corporate Tax Avoidance that it's negotiated how much of its hard-earned cash it'll fork over to the Australian Taxation Office. However, the company has declined to say just how much of a hole the Office's (ATO's) investigation is burning in its …
The pricing rort has gone on far too long, the ATO should have shut it down many years ago.
Now to see how much IBM is forced to cough up, as usual their spin doctors are saying "not us, we've been good", their words don't reflect their actions though. They are selling more and more virtual products, like software, Cloud and Watson, which are pure fluff (no cost to IBM, large price to customer), but much of the profits are "transfer priced" back to the mothership, and most of their labour is now in low cost countries like India, but the Australia Customers are still paying for full priced Australia resource prices, again, pure 90% profit.
" They are selling more and more virtual products, like software, Cloud and Watson, which are pure fluff (no cost to IBM, large price to customer), but much of the profits are "transfer priced" back to the mothership, and most of their labour is now in low cost countries like India..."
Software designed in India? That's crazy. That's like making the Windows Support Phone Guy as legit.
Back to topic, stating they sell virtual products and 'transfer priced' the profit back to the mothership doesn't seem to be problematic, unless you meant they've used loopholes to reduce the sales tax or whatever tax. Using your logic, it's like hiring an India guy to write a book and then sell it in Australia which should be taxed with the sales tax. Where's the problem here?
AU$630 million agreed to be paid back with no penalties?
That's an obscsene amount to have (seemingly) intentionally adopted dodgy accounting practices to avoid paying.
And if they agreed to AU$630 million, you can bet the "real" figure they should have paid was substantially more.
And no penalties? Well, that's the cherry on top.
Yes, no penalties.
Because as of yet no wrongdoing has been established. What they've done now is made an agreement to avoid a protracted procedure through the Australian courts of which the outcome is by no means certain for either party.
As to the Google statement, so what they are basically saying is 'if we have to follow the same rules as everyone our business model is untenable'. Same as Uber, for instance. This is a different matter entirely, and is essentially what the maffia does. They can't exist if they follow the rules either. This is altogether of a different magnitde, as it destroys the fabric of society itself. Which does not seem to bother our politicians.
"because it needs to do so in order to remain competitive"
I'm Sydney and I can still smell bullshit of that statement. If that was a legitimate reason for avoiding corporate tax the others would have done the same.
Finally the ATO is getting it right, rather than go after the little guy and try to recoup a couple hundred. Target the likes of Google and others and claw back the billions that are owed.
The only problem is now that money, that should be invested in hospitals, education and infrastructure, will be blown on crap that the federal government believes will get it re-elected. <sigh>
They are talking about competing with other stocks for investor's money to keep their share price up so stock options don't expire worthless.
Making less profit but still being wildly profitable doesn't make it any easier for competition in search/advertising to arise. But if it makes hedge funds sell their Google stock and the value falls, then executives and other employees compensated by stock options won't have the golden handcuffs keeping them at Google because they have millions coming when those options vest.
You have to use your MBA[*] to English dictionary to uncover the meaning here.
[*] Yes, I admit I have an MBA, but I don't use it for evil (i.e. not for work - these days it only serves to add letters to my resume and let me post explanations like this that wouldn't occur to the non-MBA techies who populate El Reg)
What a load of Possum poo that is.
Who competes on the global stage with Google? or even in Oz for that matter?
Answers please?
{aussie equivalent of tumbleweed blowing across the Great Sandy Desert.}
About time people the world over boyotted Google and other shell companies that operate (cough-cough) under the alphabet umbrella.
Well isn't that fortunate. They can take one year of Apple tax and use it to pay for a waste of bloody time postal survey. Shame the pollies didn't have to testicular fortitude and do what they were elected to do and vote on what 72% of the populace want and legalise Same Sex Marriage.
Guess they must be too busy watching their free and often undeclared $1,600 a year pay TV package.
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