Like! Facebook avoids most taxes
Feb. 16, 2013
By John Seiler
A year ago, Gov. Jerry Brown and other state officials were salivating like Pavlov’s dog over the $2 billion in new taxes they projected the state treasury would get from Facebook’s Initial Public Offering. Then the IPO tanked and the company lost half its value. So California would get only $1 billion.
Now it turns out Facebook isn’t going to pay any taxes!
“Facebook is reporting a $429 million net tax refund from the federal and state treasuries. And it’s not because they weren’t profitable. Indeed, Mark Zuckerburg’s little company earned nearly $1.1 billion in profits.
“Facebook’s income tax refunds stem from the company’s use of a single tax break, that is the tax deductibility of executive stock options. That tax break reduced Facebook’s federal and state income taxes by $1,033 million in 2012, including refunds of earlier years’ taxes of $451 million.”
This is happening even though Facebook co-founder and multi-billionaire Chris Hughes recently bought the New Republic magazine, the flagship of liberals. And Hughes, according to former editor Martin Peretz, has turned it into politically correct propaganda rag of Obama worship.
Not that Hughes wants to pay Obama-high taxes. He wants tax breaks just like any billionaire. And billionaires get them because their tax accountants are smarter than IRS functionaries.
So it’s the same old story. Obama and Brown insist taxes must go up on the rich so they “pay their fair share.” The rich, including rich liberals, figure out tax loopholes. An the middle-class ends up getting hit to pay the bill for all the government waste.
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Great commentary.
Isn’t the One Percent fat old WASP male bankers and corporate executives? That’s what the Occupy movement told me.
The ultimate in hipness: being able to say you’ve NEVER had a Facebook page. I’ve very smug about that and plan at a timely point in the next couple of years to brag openly about it incessantly.
Facebook’s income tax refunds stem from the company’s use of a single tax break, that is the tax deductibility of executive stock options.
This is a tax scam made possible only by campaign contributions.
Executive pay tax write offs should be LIMITED to no more than $1 million and even that is too generous. Tax payers should NOT be covering that bill, and it is a MAJOR reason the pay ration between CEO and rank and file employee has gone form 30-1 to 3,000 to 1.
Not that Hughes wants to pay Obama-high taxes. He wants tax breaks just like any billionaire. And billionaires get them because their tax accountants are smarter than IRS functionaries…..The rich, including rich liberals, figure out tax loopholes.
The tax loop holes are not “figured out” they are intentionally placed into the tax code because X or Y donated Z in campaign contributions.
This isn’t really a loophole. Stock options are like any other compensation (salary, perks) taxable to the employee and deductible to the company. Not being able to deduct salary > $1,000,000 plain old class envy and has no sound tax policy justification.
Obama complained about all those corporate jets. But they were going to another Obama fundraiser. The big money in american politics has all gone liberal because of the information revolution.
Hondo…
Rex: The way to limit loopholes is to eliminate the tax.
— John Seiler
The Koch Bros., Sheldon Adelson, et al are not liberal!
No, the loop hole is there on purpose and it is not “class envy” bob. Even $1 million tax deduction is too generous.
Everyone has to pay some level of taxes or we would have no gov, and tax deductions are a way to evade taxes. I am against excessive taxation, and we are WAY past that excessive level, especially on the poor.
All the more reason for tax reform.