People and companies don’t like to pay taxes. That’s a fact of life, and for the United States that’s creating a lot of problems. Have you ever wondered why companies continue to reap huge profits while the global economy continues to crash and burn? Well:
The secret is in a trick that sends profits overseas rather than being taxed in the U.S.
And all of this occurs through a tactic known as the “double Irish.” First, an Irish company is established in the the Cayman Islands. Next, this company licenses patent rights to another subsidiary in Ireland, which can then write off the costs as expenses. This way, they can effectively write off most of their income and operate nearly tax free.
This confusing technique has allowed Apple, Google, and Facebook to collectively save over 8 billion dollars in taxes. That’s enough money to fund 200,000 public teacher salaries or provide immunizations for some 6.5 million kids! Either expenditure would result in huge gains in health or education.
Simply put, at a time when the United States is reeling from huge budget deficits, this money could be put to good use. It blows my mind that the world lets this happen, but the evidence is all outlined in this great infographic by Visual Economics.
And think of it this way, if an American family were taxed at the same rate, they could fly to Paris, or save up money to buy a car! Sadly, however, it appears the average man faces a double standard. Mind blowing to think that most of the people reading this article pay higher taxes than a multi billion dollar company!
