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02.22.10

Microsoft Crawls Into Bed With Washington, Seattle Times Still in Denial

Posted in Bill Gates, Finance, Microsoft, Steve Ballmer at 6:32 am by Dr. Roy Schestowitz

Accounting calculator tax return - taxes

Summary: How Microsoft abstains from paying tax like the rest of the nation’s citizens while press that’s complicit with Microsoft sweeps the problem under the rug

THE PREVIOUS POST discussed Microsoft’s control of the press, especially in Washington (the state). But there are also some interesting news from Washington DC. We’ll touch on both subjects.

Steve Ballmer and Bill Gates visit the White House quite frequently (they have enormous influence over there) and Ballmer is pressuring Obama to allow Microsoft’s tax dodge [1, 2, 3, 4, 5, 6, 7, 8, 9]. Microsoft is doing it again in an organised fashion (along with business partners):

i. Microsoft and HP among firms to take on Obama over $15bn offshore loophole

Some of the biggest multinationals operating here, such as Microsoft and Hewlett-Packard, are gearing up to fight an Obama administration plan to curb offshore tax avoidance.

The $15.5bn (€11.3bn) proposal in US President Barack Obama’s 2011 budget targets what the IRS calls the growing problem of so-called transfer pricing. The technique allows companies to reduce their tax bills by transferring intangible property such as patents, trademarks and licenses to offshore subsidiaries.

The Business Software Alliance (BSA), a Washington-based trade group that represents technology companies, said it would “educate policymakers” on how the proposal would hurt US companies, jobs and the economy.

ii. Microsoft, Dell Prepare to Fight Tax in Obama Budget

Software and computer companies such as Microsoft Corp., Hewlett-Packard Co. and Dell Inc. are gearing up to fight an Obama administration plan to curb offshore tax avoidance.

The $15.5 billion proposal in President Barack Obama’s 2011 budget targets what the Internal Revenue Service calls the growing problem of so-called transfer pricing. The technique allows companies to reduce their tax bills by transferring intangible property such as patents, trademarks and licenses to offshore subsidiaries.

“Microsoft ramps up its lobbying team,” according to another report (among others):

Microsoft is fortifying its congressional lobbying team as major issues that could affect them begin to work their way through Capitol Hill this year. The software firm has hired Christina Pearson to join its Washington office as senior director for public relations.

And also:

WASHINGTON: Microsoft named Christina Pearson the senior director of PR in the company’s Washington office, effective February 15.

Pearson, most recently an SVP at Fleishman-Hillard, is a former assistant secretary for public affairs at the US Department of Health and Human Services (HHS). She replaces Ginny Terzano, who was hired to lead the communications practice at Dewey Square Group. Pearson reports to Lori Harnick, senior director of PR, who continues to oversee public affairs.

That’s just more lobbying. It’s interesting to see a move into the Dewey Square Group, which relates to illegal Microsoft AstroTurfing [1, 2, 3, 4].

A reader from The Seattle Weekly says that “Microsoft Is Entitled to Keep as Much Money as It Wants” and former Microsoft managers who are inside the Washington government feel similarly. Also from The Seattle Weekly:

Washington may soon be broke. So perhaps now is not the best time for Rep. Ross Hunter to suggest one of the state’s richest companies get a tax break.

In 1997, Microsoft opened a small office in Reno, Nevada. Why? So they could avoid paying $100 million a year in software royalty taxes.

The Seattle Times, as usual, acts as Microsoft’s cheer-leading club in the face of harsh criticism from a former vice president of Microsoft. Joining the Seattle Times and the likes of it are Microsoft’s boosters from IDG, namely Gralla and O'Neill (there other Microsoft boosters such as Gavin Clarke and Mary Jo Foley who captured this embarrassing situation just to spin it, so we’ll omit links). Anyway, the Seattle Weekly went further by slamming its competitor, The Seattle Times, for almost refusing to cover Microsoft scandals:

Seattle Times Microsoft Tax Dodge Coverage Only Found in Comments

Microsoft’s alleged dodging of over $1 billion in Washington state Royalty taxes may or may not be illegal. It may or may not be unethical. But it’s certainly news.

The P-I, Crosscut, KUOW, HorsesAss, TechFlash, BoingBoing, the U.K.’s Guardian, Huffington Post and Seattle Weekly all think so. The Seattle Times does not.

We’ve mentioned this before. At The Seattle Times they also glorify and whitewash Gates’ character, whereas The Seattle Weekly was also willing to help expose and cover Microsoft fraud [1, 2]. Another bad publication is the Seattle P-I, which is like a 24/7 advertisement for Microsoft, but the staff there declined from about 150 to just 8 or so.

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