Burger King Leaves Sinking Ship

Discussion in 'Business & Economics' started by Michael, Aug 26, 2014.

  1. Michael 歌舞伎 Valued Senior Member

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    Burger King Leaves US over Tax Rate

    Originally from WaPo:

    My question is framed around this. One of the benefits (if you want to call it that) Burger King enjoys in the USA is Tax-Payer funded food inspections all along their supply chains. They don't have to pay for that - we have to. Instead of paying for it in our Value Meal, we pay it in our taxes. Of course, it's implicitly assumed this is 'fair' because Burger King ALSO pays taxes and they benefit from all the "public" infrastructure as well as, yes, food inspection. I suppose one could make the argument that the middle class is subsidizing cheap food for the poor (who pay less in tax) ensuring that said food is at least washed in boiling ammonia once or twice before being dyed red, soaked in artificial flavor and serialized...errr, sizzled to perfection on a sesame seed bun.

    So, here's my question: Given Burger King has the legal right to leave the USA (for terrorist tax-havens like Canada) - and, they'll always have that legal right, should they have to pay for their own food inspections? Why should they and their shareholders enjoy those benefits when their companies are not located in the USSA and don't pay tax in the USSA? Sure, they can sell their crummy "burgers", but they'll either have to eat the costs of paying for their own inspections OR sell their burgers at a higher cost to cover these public-tax funded expenses (and take a chance on losing market share).

    My thoughts are: If they leave the Tax Pen, then they should have to pay out of pocket for food inspections. It doesn't seem fair their shareholders and owners benefit monetarily from our tax-payer funded food inspections.

    What are your thoughts?
     
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  3. Kittamaru Ashes to ashes, dust to dust. Adieu, Sciforums. Valued Senior Member

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    Never gonna happen (making them pay for it that is)... too many big businesses use this little loophole to get out of paying their "fair share"... a lot have even established shell companies / holding corps overseas for just this purpose...

    it's a loophole that needs closed... but probably never will be thanks to lobbying.
     
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  5. spidergoat pubic diorama Valued Senior Member

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    Um, no, that isn't certain at all. Tax dodgers like Burger King could be forced to pay some kind of fee for exporting profits.

    By the way, we benefit from food inspections in that we get ill less often. If the cost is such a burden we can just increase their taxes to cover it.
     
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  7. joepistole Deacon Blues Valued Senior Member

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    Actually, Burger King isn't leaving the country, they are just minimizing their taxes. Two, they do have to pay for their government foo inspections. Every year each restaurant pay for and purchase a licence/permit from local health department.
     
  8. Stryder Keeper of "good" ideas. Valued Senior Member

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    It's usually best to let a company accrue unpaid taxes before moaning about it. After all while it's suggested that's what they can do, you'd need at least one years books with the new infrastructure in place to prove that was the plan all along.

    We had the same problem in the UK where companies like Starbucks didn't pay corporation tax, the public eventually started complaining and then they "offered" some corporate tax which they technically didn't have to do because of their loophole.
     
  9. StrangerInAStrangeLand SubQuantum Mechanic Valued Senior Member

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    Any & all money paid to anyone by Burger King is actually paid by their customers.
     
  10. sideshowbob Sorry, wrong number. Valued Senior Member

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  11. cosmictraveler Be kind to yourself always. Valued Senior Member

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    All that needs to be done is to make a new law making anyone pay taxes from anywhere they might be if they do business in America.
     
  12. joepistole Deacon Blues Valued Senior Member

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    Well, it is a little more difficult than that. There are international tax agreements/treaties to contend with along with Republican extremism.
     
  13. brucep Valued Senior Member

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    You mean we can't expect Michael to know what he's talking about? Before he runs his mouth in this forum?
     
  14. cosmictraveler Be kind to yourself always. Valued Senior Member

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    Although it might be difficult it can be accomplished especially when the citizens would push for something like that. I'd think that most other countries have laws like that when outsiders do business within their countries so why not the America?
     
  15. joepistole Deacon Blues Valued Senior Member

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    The US Treasury a
    I agree tax reform is needed. But it will not be easy. Last week the Treasury Department issued new rules to crack down on corporate inversions and those rules went into effect yesterday. But much more is needed and it will not be easy especially given the unprecedented levels of Republican obstruction and extremism in congress.
     
  16. wellwisher Banned Banned

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    5,160
    How about the US government lower the tax rate, so businesses from around the world come to America to set up their businesses? This would create full employment and increase taxes through payroll.

    Why is American Government so inefficient compared to even socialists countries like Sweden, which has a much lower tax rate? The USA is 35%% while Sweden is 20%. If we became a socialist country would the tax rates go down or is there a scam mentality that would raise it even more? China, which is Communists, is 25% and has one of the hottest economies, so why not copy that. Why so incompetent?

    Senator Warren who came up with the chant, you (business did not build that). She implied business did not work in a vacuum, but depended on government for roads and other logistics. It is true that Government build the roads and bridges that businesses use. However, where did the government get the money for that? The government is a middle man too, so they did not build it either. The tax payer built the road government uses.

    About 90% of the tax money comes from 10% of the people. Businesses pay most of the taxes, so government dacted as an agent of the business tax payer. Those who paid the most taxes use the roads they built. They should be able to charge government for using their roads; tax break.

    If we lower the tax rate to 25%, like China, only the most competent could work in such a government environment. All the dead wood would need to be removed. This would stimulate the economy because government does not multiply money, but rather acts as money divider, making it shrink.
     
  17. pjdude1219 The biscuit has risen Valued Senior Member

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    um the US has some of lowest effective tax rates in the world. hell our effective corporate tax rate is essentially nothing. your using private personal income tax rates which swedens is actually much higher coming in at the top tier of around 51% total. plus they have a VAT of 25% the US total is a little of 40%. now the corporate tax rates top at a shade under 40% in the US and at 22% in sweden the effective tax rate shows a much different story with large corporations having effective tax rates of under 20% and many having effective tax rates under 10%. american corporation routinely pay more in taxes in these countries with "lower" tax rates than they do in the US. So to reiterate you used the wrong numbers got them wrong and even if correct wouldn't have actualy proven your point because its effective tax rates that matter not the base rate.
     
  18. StrangerInAStrangeLand SubQuantum Mechanic Valued Senior Member

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    Businesses pay taxes with money they get from their customers. As with any & all other money any business pays to anyone, it is actually paid by consumers. The more taxes a business pays the less profit it makes & the more likely it will raise prices or lessen quality and/or cut employee pay.
     
  19. joepistole Deacon Blues Valued Senior Member

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    And you think that makes sense? Do you have any proofs to support your assertions? No you don't, because none exist. Do you understand pricing in a free market? Apparently not.

    Prices in a free market are always the product of supply and demand - not taxes or profits or production cost. In competitive markets producers are price takers - not price givers. It's that suppply demand thingy which determines price.

    Further, the history of money ownership (where the money came from) is totally irrelevant to pricing or taxation. It makes for good political demagoguery to fool the fools. But economically, it is meaningless.
     
  20. joepistole Deacon Blues Valued Senior Member

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    We can always hope Wellwisher will one day get his facts straight. But, I wouldn't hold my breath.
     
    Last edited: Oct 3, 2014
  21. joepistole Deacon Blues Valued Senior Member

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    How about you get your facts straight and stop mindlessly repeating what you have been told on right wing media? Businesses around the world do come to the United States, especially in times of crisis regardless of our tax rates. That is why the dollar is and has been so strong. That is why commodity prices have dropped so dramatically. That is one reason why unemployment has gone from over 10% to 5.9%. That is one reason why we are no longer loosing 800,000 jobs per month but adding 200k plus private sector jobs every month for the last 5 years.

    Two, there is no indication that lowering tax rates affects economic growth. The Republican notion that lowering tax rates increases economic activity just doesn’t square with historical fact.

    As has been previously pointed out to you, you are cherry picking. Those countries have significant VAT taxes you are ignoring and you using the statutory rate rather than the effective rate – the rate companies actually pay. Few companies pay the statutory rate and many companies pay no income tax. The effective rate is much lower and very competitive – especially given the fact the US federal government does not assess VAT taxes. So if you are going to compare the US to other countries you need to compare apples to apples – something you and those like you have consistently been unable to do.

    Actually, it wasn’t a chant until Republicans took it out of context, misrepresented it, and began chanting it to mock our POTUS. It was “you didn’t build that” and it was part of a speech President Obama gave. If you want to track your money, as if that were important or relevant, the money in your pocket came from the US government. The government did create the money we use. So I guess, using your reasoning, the government is the ultimate creator of everything.

    And the point President Obama was making when he use that phrase is that no man is an island. We are all dependent on each other. We are all the product of what others have done and continue to do. No one person can do it all. We are all the product of what others have done and we are all interdependent upon each other. It isn’t radical and it is pretty self-evident.

    Well that claim is a little disingenuous, not to mention untrue. Payroll taxes are paid mostly by the middle class and they account for about 40 percent of federal tax revenues. Income taxes which are mostly paid by upper income earners are paid mostly by wealthy folks. But not all income is taxed equally. Income taxes apply only to “earned income” and not investment income. That is why the bulk of upper income earnings is derived from investment income which is taxed at rates which are much lower than earned income. For some reason Republicans like to ignore payroll taxes and pretend that income tax is the only federal tax.

    Corporate tax rates in the US have been falling as of last year, they only account for 10% of federal tax receipts. Income tax rates in the US have been falling are now at near historic lows. Obama raised income tax rates on the wealthiest Americans and it hasn’t hurt the economy as folks like you claim it would do. The unemployment rate is now at the lowest it has been since Obama took office. Economic growth is better than it has been in more than a decade.
     
    Last edited: Oct 3, 2014

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