‘Silicon Six’ Dodged $ 100 Billion in Taxes in the Last Decade • Protecting Children’s Health

Researchers say Amazon, Facebook, Alphabet (the owner of Google), Netflix, Apple and Microsoft – known as the “Silicon Six” – are adept at reducing their tax liabilities by shifting revenue to ports. on the beach.

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Strengthening demands for a global minimum tax to reverse corporate evasion tactics, a new analysis released last week showed that one-half of a dozen companies are based the U.S. has paid nearly $ 100 billion less in taxes over the past ten years than their annual reports state.

Between 2011 and 2020, Amazon, Facebook, Alphabet (the owner of Google), Netflix, Apple, and Microsoft – known as “Silicon Six” – which pay nearly $ 219 billion in revenue taxes, accounting for only 3.6% of their more than $ 6 trillion in total revenue, according to the Fair Tax Foundation. Income tax is paid, not total income, and researchers say so tech giants skilled in reduced their tax obligations by transferring income to offshore tax havens.

If “Silicon Six” had paid the existing tax bills of the countries in which they operate, they would have given the world’s tax authorities more than $ 149 billion more than in the past decade, the researcher. In addition, not only are corporate behemoths fork in more than $ 150 billion less than expected under a more robust international tax regime, but they are also raising the amount of payments they make. in taxes.

According to the Fair Tax Foundation, these six companies report paying nearly $ 315 billion in income taxes between 2011 and 2020, which is 23.2% of nearly $ 1.4 trillion in revenue. That’s significantly higher than the 16.1% rate actually paid by companies in the past decade, however, resulting in a gap of more than $ 96 billion between the tax figures quoted annually. financial reports and actual public revenue contributions.

Paul Monaghan, chief executive of the UK -based nonprofit, SAYS the study provides “strong evidence that the root cause of tax evasion is still within many multinationals and will not be short of root-and-branch changes in international tax rules that will provide solutions to situation. “

None of the six corporations “is an example of responsible tax behavior,” the report said. “However, the level of accountability and the tax share made vary. Amazon paid only $ 5.9 billion in revenue taxes this decade, while Apple paid $ 100.6 billion and Microsoft paid $ 55.3 billion. ”

Silicon-six tax avoidance
Source: Good Tax Foundation

The Fair Tax Foundation identified Amazon and Facebook as the worst offenders, prompting responses from two tech giants.

As The Keeper reports:

An Amazon spokesman disputed the calculations as “more misleading.”

“Amazon is the first retailer where revenue margins are small, so comparisons of technology companies with operating margins of nearly 50% are unreasonable,” the company said. “Governments write tax laws and Amazon does the thing they encourage companies to do – pay all the necessary taxes while also investing billions in creating jobs and infrastructure. margins, investing it will naturally result in a short cash tax rate. ”


“A Facebook spokesperson said:“ All companies pay taxes on their income, not us. Last year we paid $ 4.23 billion in corporate income taxes worldwide, and our average effective tax rate over the past 10 years was 20.71%, which is almost in line with the OECD average. ”

In response to corporate complaints, the Fair Tax Foundation said most of Amazon’s revenue over the past three years has been taken not from retail but from cloud services, where revenue margins are in the middle. at 25-30%. The Fair Tax Foundation also reported that in the past decade, Facebook paid an income tax rate of only 12.7%, resulting in much smaller contributions than expected in line with existing tax rates as well as the effective rate. in company tax.

The Fair Tax Foundation’s new analysis comes a few weeks after Internal Revenue Service Commissioner Charles Rettig claimed that tax evasion deprives the U.S. government of up to $ 1 trillion or more annually.

Monaghan said U.S. Treasury Secretary Janet Yellen just passed away push for a worldwide minimum corporate tax ”[lit] a fire under multilateral discussions that is slowly developing under OECD supervision. “

According to Monaghan, the Biden administration’s proposals for a comprehensive tax reform “will see a number of incentives supporting revenue transfers to the tax channels to be seen, and will see the largest number of multinationals. taxed not only where the subsidiary’s revenues are set, but where the real economic value is earned. ”

“This has a seismic impact on the likes of Amazon, Apple, Facebook, Google, and Microsoft (who have tax evasion in their organizational structure), with billions more in taxes being paid around the world,” he continues. Monaghan.

“We may find once a generation,” he added, “but world leaders at the upcoming G7 and G20 world summits need to know the nettle, progress. , and joining the agenda is even more positive-the benefits of public services around the world will be huge. ”

Originally published on Common Dreams.

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