Comment re. corporate taxation

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Madeleine Albright 01Madeleine Albright 02

Just a quick remark. Is corporate taxation a good or a bad thing? It depends on the situation. The U.S. government taxes corporations, but does not need to, since the USA does all its business, foreign and domestic, in US dollars. And since the U.S. government has no need or use for tax revenue, it is useless to tax corporations.

However most foreign nations need currencies other than their own in order to by imports. Such nations must tax foreign corporations – if they can.

The Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP) will let corporations sue governments that do anything to hinder corporate profits, including the imposition of taxes.

Lawsuits filed by corporations are decided by secret “Investor-State Dispute Settlement” (ISDS) tribunals appointed by (and paid by) the corporations to deliver verdicts that favor the corporations.

This may seem like madness, but actually it isn’t.

It’s f—king insane.

Corporate taxation does not matter to the U.S. or U.K. governments, since they have no need or use for tax revenue – but (like I said) foreign governments need foreign currencies in order to buy imports. In fact, one of our most gifted and brilliant commentators has often asked why nations that have their own currencies are not like the USA. The brilliant genius spoke out from his corner and used Venezuela as an example….

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The answer is that Venezuela’s currency is not widely accepted outside Venezuela. In order to buy imports, Venezuela needs foreign currency, since the people who sell to Venezuela do not want to be paid in Venezuelan bolivares. They want to be paid in US dollars or in euros or in their own currencies, or whatever. And since the price of crude oil is way down, Venezuela can only get foreign currency by borrowing it.

Another way to get foreign currency is to tax foreign corporations that do business on one’s home soil. However the TPP and TTIP will make this impossible for the 28 states of the European Union, plus the twelve nations that participate in the TPP.

Actually it is already impossible in many cases, because anti-tax measures are built into hundreds of “free-trade” agreements that currently exist

Multinational corporations have already sued at least 24 countries from India to Romania in tax-related disputes. To do this, they use their secret ISDS tribunals to deliver verdicts that always favor the corporations.

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Thus, average people worldwide are being screwed by corporations worse than ever. And the nightmare will get much worse. Politicians worldwide are letting it happen, in return for modest bribes from the corporations.

In 2007, Vodafone (a British company) took over much of the telecommunications industry in India. Vodafone gained more than 180 million customers in India by using offshore companies that allows Vodafone to pay no capital gains tax to India. When Indian tax officials complained, Vodafone responded with an ISDS claim, arguing that India was breaching a trade treaty signed between India and the Netherlands in 1995.

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As part of long-running legal proceedings that began in 2005, Mexico has been successfully sued by a consortium of US-based agribusiness giants, including

When Mexico taxed U.S. companies like Cargill and Archer Daniels Midland for selling soft drinks containing high-fructose corn syrup (which causes obesity), the U.S. companies took their case to a secretive ISDS tribunal, which naturally ordered Mexico was ordered to pay millions of dollars in damages.

Note: dollars, not Mexican pesos. Mexico had to dip into its foreign exchange reserves. And obesity remains a problem.

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There are dozens of other cases – and the TPP and TTIP treaties aren’t even in force yet. Corporations are telling the world’s governments, “If you try to tax us, you will pay dearly.”

Multinational oil, gas and mining companies use ISDS tribunals more than any other industry. When Ecuador imposed a windfall profits tax on Perenco (an Anglo-French oil company), Perenco ordered its ISDS to assess a fine against Ecuador, once again in U.S. dollars.

The near future will be rather interesting. Sort of like having a root canal at the dentist’s office that never ends.

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3 thoughts on “Comment re. corporate taxation

  1. Hillary Clinton should choose Madeleine Albright as her running mate, they are both as evil as each other!

    Interesting how none of the major economists have criticised TPP/TTIP, it shows who they are really working for.

    Liked by 1 person

  2. Another misconception. Corporations are easy targets for politicians and government apologists since no politicians write the law. Its kind of like trying to argue against a traffic ticket, the township writes the law and you will pay whether you like it or not. Not sure about you, but if i was a company i would do just what conpanies do, have an army of lawyers to lower my exposure to government corruption.

    Having said that, corporations are not some evil being that wants to destroy people. As a matter of fact, corporations are a mere representation of people. Corporations employ various people and purchase goods and services from other corporations. Most companies run on a thin margin, save a few.

    That aside, the world runs on profit motive. If you were making 50k a year, would you help a friend starting a business working for 25k?

    All corporations compete on price, even when quality is a differentiator. A lower price is what will get you more clients, if you can sell a better quality, than thats even better.

    When a company’s profitability is threatened by taxes, companies will pass those to consumers. If comsumers can find a similar product for a cheaper cost than that company will not survive.

    Nobody likes to pay taxes, but as a society, we need taxation – real taxation? No, i am not a masochist, but although Liz thinks i am, i am not stupid.

    Taxes take many forms, including the taxes on your paycheck, property taxes, sales taxes, sales increases due to higher corporate taxes, and devaluation of the currency (aka, taxation by force).

    If the government funded itself just with tax receipts, than it is pretty obvious that it could not spend what spends today. As a matter of fact, people are already unhappy with the current taxation which only covers part of the budget. So a tax system is required when you want transparancy and control between what people think their government should spend and what it actually does, it provides a much needed signal telling the government enough is enough.

    Before you comment on how the government “doesnt us tax money”, maybe you could explain (for once) the difference between the government collecting money representing 500 tons of food and burning the money and then issuing money representing 500 tons of food. The government still taxed the 500 ton of food out of the populace. Rodger thinks he’s clever by wordsmithing his content, but his theory has more holes than swiss cheese.

    And btw, only you and Rodger think the government doesnt use tax money. Talk about dunces in a pole…

    So ask for corporate taxation and you will pay with your pockets.

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  3. One other key piece. Company profits are either re-invested in innovation or in via banks, both of which result in more jobs/lower prices, etc.

    Also, how good is it to remove “taxes” when the government can force it out of you by devaluation. Venezuela can taxes to zero tomorrow and not a single company will return.

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