04.25.10
Gemini version available ♊︎The Seattle Times Finally Questions Microsoft’s Political Games for Tax Avoidance
Summary: Even the Seattle Times, one of the local papers that sometimes seems to be Microsoft-sponsored propaganda, is starting to question what Microsoft is doing to Washington and how
THE PREVIOUS post showed that Microsoft has many reasons to avoid expenditures such as tax. To quote a key sentence, “Microsoft has a huge debt approaching a tenth of a trillion dollars.” Last week we added this Wiki page about Microsoft’s tax dodge and also evasion, for which it was found guilty in a court of law. Microsoft does not prioritise compliance with the law, so it’s probably a nonevent really.
A former Microsoft employee continues to expose the government cronyism that enables Microsoft to essentially legalise its evasion of tax (which can then no longer be labeled “evasion”). When former Microsoft managers write the law, why would the law paint Microsoft a “fraud”?
Struggling to close a $2.8 billion fiscal deficit, the Washington State Legislature ended its recent special session with two huge gifts for Microsoft:
1) It gave Microsoft an effective $100 million annual tax cut by revising the definition of the royalty tax. Under the old law, all of Microsoft’s $20.7 billion annual software licensing sales were taxable in Washington state at .484%. Under the new law, the royalty tax will be apportioned so that only the portion of sales to Washington State customers would be taxable, a tiny fraction of Microsoft’s taxable revenue.
2) It also gave Microsoft amnesty on an estimated $1.25 billion in unpaid taxes, interest and penalties that the company has avoided paying since 1997 by reporting this revenue from a small Reno, Nevada office. The state’s Department of Revenue has ignored this practice and refused to address precedents that call the legality of Microsoft’s accounting into question.
Most of the legislation was led by Chair of the Finance committee Rep. Ross Hunter, a 17 year veteran former employee of Microsoft.
[...]
Given that the Seattle Times waited until almost the close of the special session to acknowledge the dispute about Microsoft’s Nevada tax practice, we imagine that Chairman Gates has greatly appreciated this blog’s investigative work of his company’s tax practices and the quiet effective accomplishments of Rep. Hunter.
Please help promote this in Slashdot. It deserves more attention.
The Seattle Times, which is probably the Seattle publication that’s deepest in Microsoft’s pocket (we have explained just why on numerous occasions), says that “Microsoft chooses key time to remind Olympia of its clout” (we covered this in [1, 2]).
Microsoft insists the timing is coincidental.
Yet it chose Friday to publicize a study showing its massive economic effect on the state.
Not any Friday, but the Friday before lawmakers huddled for a last push to decide what taxes Microsoft and everyone else must pay to keep the state afloat.
This is actually part of quite a scandal and it deserves the front page of local papers (at the least). We wrote about this in length 6 days ago. █
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