Also shifting income to another jurisdiction is considered "good management" by management. I hate it, but the rule is "if you can explain solid business logic in front of a judge with a straight face then the judge can't find issue with it". The law may be different in nz.

Most parent companies in the usa have hq in the tiny state of Delaware and massive "rent" payments from the "subsidiaries that do all the actual business" to the parent. Many states get into agreements for waste management to be taken over by a private company and all profits go to the local government... and the local subsidiary never turns a "profit". Sigh ...

[–] BalpeenHammer@lemmy.nz 1 points 6 days ago (1 children)

I guess if you can make up numbers about profits then it might make sense.

It's more likely tax evasion as you described. That's on us. We are too fucking stupid to prevent this kind of tax evasion. Well maybe not stupid, just corrupt as shit because they grease the palms of the parties and politicians to make sure they don't get taxes properly.

[–] FreedomAdvocate 1 points 6 days ago (1 children)

It’s “tax evasion” in the sense that it’s a company using tax laws to minimise the amount of tax they pay, just like how you and I do when we do our taxes. The differences are it’s much easier to do for multinational corporations due to tax laws, And due to them being able to pay lots of accountants lots of money to find every way possible.

[–] BalpeenHammer@lemmy.nz 1 points 6 days ago (1 children)

Why is any of that even possible? Because we wrote the tax laws to make it possible.

[–] FreedomAdvocate 3 points 6 days ago (1 children)

There are a multitude of good and reasonable reasons why it's possible. You can't make companies pay tax on revenue because that would instantly throw 90% of companies into bankruptcy. You can't stop companies from paying licensing fees etc to their parent company and writing it off as a business cost, because that would destroy all franchise stores etc.

The tax "loopholes" exist for a legitimate reason, so companies structure themselves so they can take advantage of them. Getting rid of them would hurt the companies that need them more than the companies that "abuse" them.

[–] BalpeenHammer@lemmy.nz 1 points 6 days ago (1 children)

There are a multitude of good and reasonable reasons why it’s possible. You can’t make companies pay tax on revenue because that would instantly throw 90% of companies into bankruptcy.

I see people say this all the time but it makes no sense. I pay taxes on revenue and so do you. We don't get to deduct all our expenses from our salaries right?

How come every single person in the country isn't bankrupt if paying taxes on revenue leads to bankruptcy?

You can’t stop companies from paying licensing fees etc to their parent company and writing it off as a business cost, because that would destroy all franchise stores etc.

Yea so?

The tax “loopholes” exist for a legitimate reason, so companies structure themselves so they can take advantage of them. Getting rid of them would hurt the companies that need them more than the companies that “abuse” them.

I disagree. Companies exist in countries where these types of things are not permitted.

[–] FreedomAdvocate 2 points 6 days ago (1 children)

I see people say this all the time but it makes no sense. I pay taxes on revenue and so do you. We don’t get to deduct all our expenses from our salaries right?

Personal Income tax is not the same as taxes that businesses pay. You can make tax deductions too, and you can do salary sacrificing and many other things to reduce your income tax as well.

If you made companies pay tax on revenue, pretty much every company in the entire world would close instantly.

Yea so?

So you think franchises shouldn't exist?

Companies exist in countries where these types of things are not permitted.

Example please? Which companies in which countries are doing tax things that aren't permitted?

[–] BalpeenHammer@lemmy.nz 2 points 5 days ago (1 children)

Personal Income tax is not the same as taxes that businesses pay.

I know. That's what I said. We pay taxes on revenue and business pay taxes on profits. They get to deduct all their expenses and we don't.

You can make tax deductions too, and you can do salary sacrificing and many other things to reduce your income tax as well.

I can make some deductions but I can't deduct all my expenses like a business does. If I was to deduct all my expenses like a business does I would indeed reduce my income taxes drastically.

If you made companies pay tax on revenue, pretty much every company in the entire world would close instantly.

Again if this is true why isn't every person in the world bankrupt because they pay taxes on revenue?

So you think franchises shouldn’t exist?

Wouldn't bother me at all.

Example please? Which companies in which countries are doing tax things that aren’t permitted?

I don't understand why you decided to be so dishonest all of a sudden. Why did you go to "doing tax things". When did I say there were countries where businesses didn't "do tax things"?

[–] FreedomAdvocate 1 points 5 days ago (1 children)

Your income is not revenue.

Businesses only get to deduct business related expenses, the same way you and I get to deduct income-earning related expenses.

[–] BalpeenHammer@lemmy.nz 1 points 4 days ago (1 children)

Why isn't my income revenue?

Businesses only get to deduct business related expenses

What other kinds of expenses does a business have?

the same way you and I get to deduct income-earning related expenses.

like what? I can't deduct my costs associated with traveling to work. I can't deduct my clothing I buy for work. I can't deduct my lunch at work. I can't deduct my laptop case or anything like that.

I incur tons of expenses for my work. I can't deduct any of it.

[–] FreedomAdvocate 1 points 4 days ago (1 children)

Because definitions…..

You can deduct your laptop case, at least you can in Australia.

Businesses and individuals have different tax laws for good reasons. If businesses had to pay tax as an individual then there would be maybe 10 businesses left in the world. I was going to say that I’m sure you can see how that would be bad, but I’m not sure.

[–] BalpeenHammer@lemmy.nz 1 points 3 days ago (1 children)

You can deduct your laptop case, at least you can in Australia.

Really? Do you have any citation for this? If I bought a laptop case so I could put my work laptop in it I could deduct it from my income?

Businesses and individuals have different tax laws for good reasons.

So you say. I disagree.

If businesses had to pay tax as an individual then there would be maybe 10 businesses left in the world.

Again you keep repeating this as if it was some law of nature or something. If that's true then by logical inference there would be only 10 people left in the world who were not bankrupt. How come normal humans can pay tax on revenue and not go bankrupt but a business would?

I was going to say that I’m sure you can see how that would be bad, but I’m not sure.

I just don't believe your outrageous and unsubstantiated assertion.

[–] FreedomAdvocate 1 points 3 days ago* (last edited 3 days ago) (1 children)

Yes, really. How old are you btw? Do you have a full time job? Have you ever done a tax return?

Really?

Really.

Do you have any citation door this?

Sure do: https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/work-related-deductions/tools-computers-and-items-you-use-for-work/bags-and-cases-for-work-items

To claim a deduction for a bag, case or satchel you must:

incur the cost and use the bag or case to carry items for work

need to carry the items for work and the bag or case must be suitable for that purpose

You might want to go see an accountant asap and get them to add some deductions for the last few years ;). You can do that btw - adjust previous years tax returns after they’ve been filed so you can get some money back.

How come normal humans can pay tax on revenue

Revenue != income, first and foremost. Revenue is total earnings from sales of services and products by a business. Income/profit is what a business is left with after expenses (and other things we don’t need to get into) are deducted.

Just think about this super simple example:

You start a business selling PCs that you build out of your home.

In your first week you only buy inventory (case, cpu, mobo, ram, gpu, ssd, etc) to make the pcs when you get an order.
You offer only a single sku for $2000
You get 4 orders and take $8000 in revenue.
You buy the parts to make these 4 PCs, parts list: $75 case, $250 cpu, $100 SSD, $200 RAM, $200 motherboard, $175 PSU, $750 GPU, $50 cables etc. Total per PC: $1800. 4 PCs = $7200. It costs $50 to ship each order, customers pay you for it = $200.

Total costs for first week: $7200 (PC parts) + $200 (shipping) = $7400

Total revenue for first week: $8000 (PCs) + $200 (Shipping) = $8200

Congratulations, you made $800 “profit” in your first week! Seems like a nice little business!

Now let’s work out your taxes using the current business tax laws. Let’s say the business tax rate is 25%.

Deduct your business costs from your revenue to get your profit, then pay tax on the profit: ($8200 - $7400) = $800.00 x 0.25 = $200.00 tax to pay.

Result: you made $600 profit in your pocket this week.

Now let’s work out your taxes using your proposed system of businesses paying tax on revenue.

Revenue of $8200 x 0.25 = $2,050.00 tax to pay.

Result: you owe the tax office $1250 after giving them your $800 that you made in “profit”. The business is unsustainable even though you have a healthy profit margin on all of your items.

Do you see why what you’re saying literally does not make sense?

[–] BalpeenHammer@lemmy.nz 1 points 3 days ago (1 children)

Yes, really. How old are you btw? Do you have a full time job? Have you ever done a tax return?

I live in New Zealand. We don't do tax returns here. Our taxes are automatically deducted from our salaries.

You might want to go see an accountant asap and get them to add some deductions for the last few years ;).

If I lived in Australia and if I had kept the receipts for every item I bought that I used at work and if the deductions of all those things would make a measurable impact on the taxes I paid I would do that.

Revenue != income, first and foremost. Revenue is total earnings from sales of services and products by a business. Income/profit is what a business is left with after expenses (and other things we don’t need to get into) are deducted.

Revenue is income. Income is not profit. Surely as an adult who has filed taxes you know this.

Do you see why what you’re saying literally does not make sense?

Ok then why can't I deduct all my expenses for living and pay taxes only on the amount left? If a business gets to deduct the equipment they buy then I should be able to deduct all the food and clothes that I but. If a business gets to deduct their utilities I should be able to deduct my utilities. If a business gets to deduct the amount they pay employees and contractors I should be able to deduct any money I pay to tradies.

Why should I be punished for paying taxes on all my income while a business pays only a tiny percent of their income?

[–] FreedomAdvocate 1 points 3 days ago* (last edited 3 days ago) (1 children)

Tax is automatically deducted from our salaries here too, but you still have to lodge a tax return every year. This is where you claim all your deductions from the previous 12 months.

Revenue is income. Income is not profit.

Definitions matter. Google the definitions of revenue and income in regards to businesses.

I should get to deduct utilities

Guess what? You can if the utilities are used for your work, such as working from home.

As for the rest……did you miss the example I just wrote out for you? The one about paying tax on revenue vs profit? Did you see it but you just didn’t understand it?

[–] BalpeenHammer@lemmy.nz 1 points 3 days ago (1 children)

Tax is automatically deducted from our salaries here too, but you still have to lodge a tax return every year. This is where you claim all your deductions from the previous 12 months.

We don't do that here typically.

Definitions matter.

I know. That's why I say there is a difference between revenue and profit.

Guess what? You can if the utilities are used for your work, such as working from home.

I need them to live so they are expenses I need for work. Same goes for food, transportation, clothing, shelter etc.

I should be able to deduct all of those expenses from my income.

[–] FreedomAdvocate 0 points 3 days ago (1 children)

So no one should ever pay any tax is what you’re saying?

You also still haven’t addressed my tax-on-revenue vs tax-on-profit example for businesses either. Could you please do that now, or there’s no point continuing this because you can’t understand why the difference exists.

[–] BalpeenHammer@lemmy.nz 0 points 2 days ago (1 children)

So no one should ever pay any tax is what you’re saying?

Again why do you resort to lying? Why are you being so dishonest? Do you think acting in a sleazy dishonest way like this makes you look good or wins arguments?

When did I say nobody should ever pay taxes? Why did you feel compelled to lie like this?

All I am saying is that humans should be given the same affordances as businesses. If I don't eat or drink or have clothes to wear I go out of business. I die. I should be able to deduct every penny I spend on anything that keeps me alive.

Could you please do that now, or there’s no point continuing this because you can’t understand why the difference exists.

It's doubly futile when you continually lie about what I am saying. Shame on you. Stop being such a dishonest sleazeball and have an adult conversation.

[–] FreedomAdvocate 1 points 2 days ago (1 children)

I’m no lying- I’m using what you said - that people should be able to deduct all their expenses including food/clothing/transport/housing/etc from their income and only pay tax on their “profit”, which would result in pretty much no one ever paying any tax.

Answer my questions about the example I gave you. Why do you continue to avoid it? Is it because you know you fucked up?

[–] BalpeenHammer@lemmy.nz 0 points 1 day ago (1 children)

I’m no lying- I’m using what you said - that people should be able to deduct all their expenses including food/clothing/transport/housing/etc from their income and only pay tax on their “profit”, which would result in pretty much no one ever paying any tax.

No it wouldn't. They would pay taxes on any money left over after all that just like businesses do.

Answer my questions about the example I gave you. Why do you continue to avoid it? Is it because you know you fucked up?

I did answer you. You keep insisting that income is profits which it clearly isn't. Profits is what's left over after you pay all your expenses.

[–] FreedomAdvocate 1 points 1 day ago (1 children)

No, you did not answer my example and questions.

Do you understand why businesses couldn’t pay tax on revenue?

As for income/profits, you’re just getting yourself all confused. When you earn an income from a job, you pay tax on the profit after you’ve deducted your costs. This is what your tax return is - your chance to claim all your costs that you paid in earning that income, thereby reducing the taxable income. You’re just getting confused because the tax is automatically taken out every pay.

[–] BalpeenHammer@lemmy.nz 1 points 1 day ago (1 children)

Do you understand why businesses couldn’t pay tax on revenue?

In the made up numbers you presented?

When you earn an income from a job, you pay tax on the profit after you’ve deducted your costs

This is a false statement. I do not get to deduct the costs of my food, babysitter, drink, transportation, clothes etc. I should be able to deduct all my costs like a business does. A business gets to deduct ALL their costs. Every single penny.

You’re just getting confused because the tax is automatically taken out every pay.

No I am not. I should be able to deduct every penny I need to survive just like a business does.

[–] FreedomAdvocate 1 points 1 day ago (1 children)

Those are not costs associated with your job, that’s why you can’t deduct them.

A business gets to deduct “all” its costs because all the costs are associated with the business. There are laws around this, and no, not everything can be deducted.

In the made up numbers you presented

Yes, that’s how examples work. Do you think the numbers are “wrong”? The prices and margin that I gave for a PC build are very reasonable and realistic.

Answer my questions from my example. Last chance then you’re blocked as you’re clearly not capable of intelligent debate.

[–] BalpeenHammer@lemmy.nz 0 points 18 hours ago (1 children)

Those are not costs associated with your job, that’s why you can’t deduct them.

They are associated with my job because if I don't have them I can't do my job.

A business gets to deduct “all” its costs because all the costs are associated with the business.

See above. If I don't eat I can't do my job.

Yes, that’s how examples work. Do you think the numbers are “wrong”?

I think your example is silly. There is no reason we can't have the exact same tax structure for businesses as we do for individuals. We could set up tiers etc. If people somehow are able to stay alive despite being taxed on revenue and having no relief whatsoever for their living costs so can businesses.

Answer my questions from my example. Last chance then you’re blocked as you’re clearly not capable of intelligent debate.

Oh my god. Some rando on the internet on a web site ten people use is going to block me because I don't buy into his ideology. Whatever shall I do? I will be so despondent!

I answered your question multiple times. It's just that your zealotry and inability to think outside the box causes you to reject the answer.

[–] FreedomAdvocate 1 points 3 hours ago (1 children)

Answer my questions about my example.

You can’t because they prove you wrong.

[–] BalpeenHammer@lemmy.nz 1 points 1 hour ago

I answered it multiple times. You just don’t like the answer.

What you are really saying is “agree with me”