Thursday, June 18, 2015

Wal-Mart Saving Billions With Overseas Tax Havens...

Rational Nation USA
Purveyor of Truth



Wal-Mart Stores Inc. owns more than $76 billion of assets through a web of units in offshore tax havens around the world, though you wouldn’t know it from reading the giant retailer’s annual report.

A new study has found Wal-Mart has at least 78 offshore subsidiaries and branches, more than 30 created since 2009 and none mentioned in U.S. securities filings. Overseas operations have helped the company cut more than $3.5 billion off its income tax bills in the past six years, its annual reports show.

The study, researched by the United Food & Commercial Workers International Union and published Wednesday in a report by Americans for Tax Fairness, found 90 percent of Wal-Mart’s overseas assets are owned by subsidiaries in Luxembourg and the Netherlands, two of the most popular corporate tax havens.

Units in Luxembourg -- where the company has no stores -- reported $1.3 billion in profits between 2010 and 2013 and paid tax at a rate of less than 1 percent, according to the report.

All of Wal-Mart’s roughly 3,500 stores in China, Central America, the U.K., Brazil, Japan, South Africa and Chile appear to be owned through units in tax havens such as the British Virgin Islands, Curacao and Luxembourg, according to the report from the advocacy group. The union conducted its research using publicly available documents filed in various countries by Wal-Mart and its subsidiaries.

Randy Hargrove, a Wal-Mart spokesman, called the report incomplete and “designed to mislead” by its union authors. He said the company has “processes in place to comply with applicable SEC and IRS rules, as well as the tax laws of each country where we operate.”

Excerpt Bloomberg Business

Bottom line? Incomplete report or not or not Wal-Mart has actively sought, and succeeded in finding multitudes of ways to avoid paying corporate txes. To the tune of billions and billions of dollars.

Yup, their the friend of America and the American workers. Keeping prices and wages low, they avoid tax liabilities as well. It may not be moral as America struggles but it is legal.

While we're at it lets all sing All HailCitizen United< as well. Continue reading the full article BELOW THE FOLD.

Via: Memeorandum

38 comments:

  1. What they do is take advantage off all available tax loopholes in the US tax system. This is not immoral or illegal but is good management. If the US would become tax competitive with other countries maybe they wouldn't need to go off shore. Most large corporations and ultra rich take advantage of foreign investment for tax purposes
    Where is the tax overhaul our corrupt elected elite have touted for decades. Lower business tax rates, which is a pass through to the consumer, and adopt the Fair Tax, which is just that Fair. The biggest issue with doing that is the tax system is a great power source for our governing royalty and they won't give that up without decisive action by the voters.

    ReplyDelete
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    1. The corporate tax rate in the USA (measured against GDP)is among the lowest in the world. Perhaps THIS will help you to understand skudrunner.

      As I said, what Wal-Mart is doing is legal. In my view, as a truly patriotic American, what they are doing is less than ethical or moral.

      Delete
  2. That is a pretty nifty trick, earning 1.3 billon dollars without having any stores in the country. But is this not something they should have the freedom to do? It could even be viewed as noble... They are finding ways to hold on to THEIR money... And keep it out of the hands of those who want to steal it to distribute to the parasites (Dems buying votes).

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  3. Always interesting how statics can mean anything you want them to, kind of like polls. Just form the question what you want the answer to be. Taxes in relationship to GDP is a great framing reference but does not solve the issue. There has to be an incentive to keeping business from relocating and high tax rates are not it.

    Again, taxes are a pass through and companies do not pay them, purchasers do.

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    Replies
    1. I agree that looking at taxes divided by something else instead of looking at the actual amount paid is a lot less accurate.

      I would be interested also to find out the actual amount of tax dollars paid by Walmart in the United States on an annual basis.

      Delete
    2. There are many way to look at taxes. So, what is a reasonable corporate effective tax rate.

      Poor Wal-Mart, such a misunderstood and abused company.

      Delete
    3. Wal-mart is an example of a company not paying the full cost of its labor. Thus, the unpaid portion falls on the shoulders of the rest of us.

      Delete
    4. It seems to me if they are going to just whore the dollar off anyway, just raise minimum wages. Allow for more inflation. As long as growth keeps pace, what's the difference?

      And I see all these a-flag-wavin' conservative patriots fussing about our "sovereignty" but Adam Smith Forbid we do anything to piss off the multinationals, who have real power over our daily lives from the milk we pick up at the convenient store to your entire elected government.

      JMJ

      Delete
    5. Jerry said: "Wal-mart is an example of a company not paying the full cost of its labor"

      This is only true for situations where Wal-mart promises one level of pay, but pays less than this. If and when this happens, they should be sued/prosecuted.

      Delete
    6. I guess dmarks is OK with picking up the tab for Walmart not paying a living wage for their full time workers.

      Delete
    7. No dmarks, it's Walmart dominating markets and paying the very least they can get away with. It's called being an evil scumbag and I wish you cons have the ethics and morals to see that. But, you don't.

      JMJ

      Delete
    8. Jerry: That's not "not picking up the tab" to not pay someone more than they actually earn. No company is responsible for funding someone's lifestyle. They are just responsible for paying the amount earned. No more, no less. Whatever this extra "tab" is, it is a flight of imagination to think that Walmart owes it, since it has nothing to do with the work being done there.

      Jersey: Dominating markets by providing better service and prices than others? Paying the least they can get away with... so? Any business does this. Even mom and pop businesses. And the mom and pop's pay less than Walmart for these same retail jobs. There's nothing "evil scumbag" about this.

      Delete
    9. Ok, dmarks, let's not call it "picking up the tab". But the fact remains, since Walmart pays such a low wage to full time workers that they quality for public assistance, you and I end up paying to supplement Walmart wages which puts billions of dollars in the Walton family pockets, billions of dollars that they could afford to pay their employees, rather than you and I paying it. But I guess you don't mind supplementing the Waltons' income.

      Delete
    10. Jerry, do you make the same argument for hardscrabble mom-and-pop retailers who pay full-time employees even less than that to do the same sort of retail jobs?

      Delete
    11. And Jerry, what do you demand for the situation of "low age to full time workers" where

      1) the worker is a late high school kid from an upper middle class family working full time as a Walmart cashier over the summer.... their "living wage" is probably close to $0.

      2) the worker is a single mother with 5 kids, two of them special needs? Their "living wage" is probably close to $150,000 a year?

      -------------------

      Such different situations. Do you want Walmart to pay both $150,000? Or pay each according to their needs, without any regard entirely to the value of these retail jobs?

      Delete
    12. Wal-Mart has earned their reputation and it is not a good one in some respects.

      But first... define what constitutes "a living wage.

      2) Part time or summer help while attending school is not really the issue; is it?

      3) Are we getting into the weeds with obvious yet unstated reference to Marx (communism).

      Labor should be paid based on skill set and demand for the particular skill. Obviously the value of a Wal-
      Mart greeter is less than a cashier so who should receive the higher wages?

      Should a Plant manager make what a heart surgeon makes?

      A case maker what a teacher makes?

      A discussion to be continued perhaps...

      Delete
    13. Les asked: "But first... define what constitutes "a living wage."

      The amount varies so wildly depending on one's living situation and lifestyle. The one single amount quoted as the best example is like something pulled from a hat, and only applies to some.

      Delete
    14. An answer not unanticipated.

      In our high tech and analytical society it should not be difficult to determine what the minimum annual wage is in any geographical area to keep an adult just above the poverty level. That it seems would constitute a living wage. What is neccessary not all that is desired.

      That ought to be the standard for a minimum wage in each geographical area. At least in a society that understands Thomas Paine and the concept of "general welfare."

      Really, isn't it in the long term rational interest of business, society, and a nation?

      Delete
    15. Well described, Les. Now, would you apply this same minimum wage standard all across the board? Or would clerks at Walmart have a higher minimum wage than those at a tiny small business that is barely afloat?

      Delete
    16. Ah, another anticipated question. With the usual concerns to which there are no easy answer and which will keep us on status qou.

      Short answer is, the market of the 19th and 20th century is slowly failing us.

      What is your solution?

      Delete
    17. I'm more in favor of the EITC. And to answer Jerry's question earlier. In terms of providing for the poor, I will have no problem "picking up the tab" for those stuck in a situation where their job and skills are such that they can't make ends meet with it.

      There's plenty of these employed by small businesses as well.

      Delete
    18. dmarks, to answer your question about the mom and pops, Yes.

      In general terms, I would define a living wage as one where a single person no longer qualifies for public assistance.

      Delete
    19. Mom & Pop stores (which are disappearing) could afford to pay higher wages if the larger corporations paid more. Because when these workers (those working for larger corporations) had more money in their pockets, they would spend this money into the economy... Which would increase sales for all, including mom & pops (or small businesses). This is the virtuous cycle that is created by raising the minimum wage. It's a better solution than the corporate welfare dmarks seems to favor.

      Delete
  4. Raise the minimum wadge and allow inflation to increase. So you make more but things cost more so you are back to the start.
    I just read Paul's idea of tax reform and it makes sense and takes into account lower income families with an IC tax credit.
    Again, Walmart works within the tax code and if we don't like it, change the tax code.

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  5. Again, Walmart works within the tax code and if we don't like it, change the tax code.

    EXACTLY!

    ReplyDelete
  6. Skud is correct in that whatever taxes imposed on business will ultimately be paid by the end purchaser.

    And yes, higher prices means higher costs, inflation, etc, whether those costs are labor, or product related.

    But inverse, lower taxes = lower prices is sadly not true.

    Business exists to make money. The more, the merrier, at least for the investors, frequently people like you and me through of 401k's, retirement accts, and mutual funds, etc. We demand it. Period. If it is a public company, it is the law.

    So if we want something different, we've got to, as Les says, change the law. But that won't happen, as we like our money and dividends.

    To paraphrase Skud and many like minded people, poor folks are addicted to free stuff. People with $$$, are addicted to growing profits and dividends.

    Most all people become slaves to what people are willing to give them, whether it be corporate, or personal welfare.

    ReplyDelete
    Replies
    1. The very successful, and usually wealthy, become slave to work, As wealth accumulates from their hard work the growing wealth works for them.

      Poor folks have nothing working for them, sometimes including motivation.

      Delete
    2. Higher taxes don't necessarily mean higher prices. The demand has to support higher prices. Alternatively higher taxes may mean lower profits.

      Delete
  7. "American corporations have become more aggressive about minimizing their tax obligations. The rise in intangible assets, the mobility of income, the availability of intermediaries who peddle avoidance strategies, and the increasing attention paid to reported earnings have all made tax planning an important piece of financial management. As a result, more than half of American corporations no longer have significant domestic tax obligations, according to the U.S. Government Accountability Office.

    At the same time, ironically, managers have come to embrace corporate social responsibility. Companies routinely tout their constructive role in society and pour resources into social programs even as they pursue aggressive tax strategies. Instead they should show their commitment to their communities by treating their tax obligations as a responsibility commensurate with, say, abiding by environmental regulations." Harvard Business Review-2012

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  8. Amen BB Idaho, well said. As a manager I can attest tp the truth of this. I always found the corporate social responsibility meme to be mostly BS designed "to put the best face possible on the pig". Of course I've worked for the good, the bad, and the ugly; the "pigs" are the ugly.

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  9. That BS comes in many forms, Les, including "greenwashing". Save the Earth: Drive a Prius!

    BB: if those corporations really wanted to help society, would they do better by giving money to truly effective charities instead if giving more tax money (limos for Congressmen, MIC, mohair farm subsidies) to government?

    ReplyDelete
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    1. I think, dmarks, given that the Harvard Business Review noted that half of corporations pay
      no tax whatsoever despite the privilege of utilizing our shared infrastructure, their legal loophole shenanigans result in the rest of us bankrolling their privilege. IMO, the charities
      getting the lion's share seem to be super PACs these days and their lobbyists no doubt buy
      plenty of limos AND congressmen . Like RN, I've been through the
      private sector at many levels and we need understand the good, bad and the ugly.

      Delete
  10. I know w mhat you mean about super pack masquerading as charities, BB. I didn't word my statement well enough to exclude those, I guess, when I mentioned charities.

    Walmart pays billions in taxes. What does GE pay?

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    Replies
    1. Wal-Mart shelters billions as well. Very patriotic as infrastructure crumbles. Not to pick on just Wal-Mart as they certainly aren't alone.

      Delete

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