Kiwi tax probe squeezed $25m out of Microsoft – now it's Oracle's turn A week after Microsoft paid just under NZ$25m (£12.41m/ $16.93m) to New Zealand's Inland Revenue Department in a dispute over transfer pricing, Oracle has revealed it is also under investigation. Oracle said in its annual accounts that it received a statement of position from the nation's tax inspectors in April – basically, a …
Allowing profits within a nation to be 'offshored' is just a form of parasatism - the benefit only goes to one side and the other side 'the nation and its people' are actively harmed.
Never underestimate the deviousness and selfishness that will be deployed by anyone driven by greed (especially if it's an 'multi-national corporate entity').
Well technically since we are still a monarchy he can lobby Brenda in Buck house as she is still nominally our monarch and therefore sovereignty holder. Though she would legally in NZ have to consult Maori first who will not like the idea I expect.
BTW the NZ military plan for invasion is for the army to 'go bush' to wage a guerrilla war targeting communications. Trying to hold Auckland and Wellington while the centre of the North Island is bandit country would not work very well.
If anyone has seen Hunt for the Wilderpeople (great fun if you haven't) it is set in the Urewera national park. Just one such place. NZ is rewilding so the amount of bush will only increase. The US Army doesn't have a good record against such opposition. Also good luck using an Abrams tank in much of NZ.
What the revenue services usually get cheaters with is an 'Alternative Minimum Tax' clause, which is usually hidden deep in the murky depths of the tax codes, and which is not exercised nearly often enough. The better way to do things is to institute a type of General Sales Tax, which is something corporations hate - for good reason, since they cannot evade it.
The better way to do things is to institute a type of General Sales Tax, which is something corporations hate - for good reason, since they cannot evade it.
The trouble with that is that it hurts those who legitimately have a low-markup business. This is something that the likes of starbucks pretend to have - through the use of fake costs to be paid to another part of their business that lives in a low tax country. Distinguishing between fake & real costs is the real issue. It probably needs to be decided by fiat by the tax authorities -- any sort of formulation in law will just be worked around by accountants/solicitors; but general principles and a fiat court will have them squealing 'unfair, unfair' but to everyone else's benefit.
But the tax authorities are not 100% fair either, look at IR35 :-(
Just have the tax law deem all IP transfer costs between members of a corporate group to be zero. (Ie no moving costs to a low tax country by having it be the "owner" of the IP and collecting "licensing fees" if both companies are owned by the same corporate group.) This will hurt Apple and Oracle by eliminating one of their main tax scams.
Icon for Oracle's and Apple's bosses if this change is made =============>
New Zealand has a Goods and Services Tax - a form of VAT with very few exemptions. The rules have also changed for low value imports - now any overseas supplier supplying more than NZ$60,000 in any one year need to register for and pay GST so the likes of Amazon need to charge GST.
The problem is getting companies to pay tax on the profits they make selling in NZ.
NZ has an interesting wrinkle, which is probably what gave the taxman leverage in these cases: if the authorities consider that a tax arrangement unduly lessens the tax otherwise payable, they can simply set it aside and work out the tax differently. In principle, this is a horrible idea, because it means that no one can really work out with any certainty what tax is due. But it means that people who try to be too clever by half are likely to wind up on the wrong side of a big bill.
Transfer pricing is what enables my IT team's work to be charged to our Australian subsidiary where 90% of the support is needed. If that wasn't the case, the CFO would be demanding that we relocate to Australia - a fate worse than death.
It's not some kind of unmitigated evil - it's a normal accounting practise, especially where services are spread over multiple countries. The devil as always is in the details.
Meanwhile also in NZ, a combination of Police and SAP incompetence resulted in personal details of all firearms license holders being made available to any dealer who logged into the system - rumour has it that it wasn't just dealers either, but any bozo. Thanks very much Plod & SAP for handing out a shopping list to the local crims.
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