In what world is a massively profitable company paying almost nothing in taxes polarizing?
1. Tax credits are illegitimate
2. Accelerated depreciation is illegitimate
3. Ownership of productive companies is "hoarding wealth"
4. Journalism is in a battle with the current administration
5. Paying taxes is a good thing
If you _don't_ buy into these premises, for which there is no argument given for or against, you'll be tilted against the author. If you do, you'll be tilted against Tesla. This is polarizing. There is no nuance, there is no learning, there is no insight.
Is this controversial?
During his rallies he'd literally have the entire crowd riled up against the very concept of journalists, because they might not suck up to him every single second of every single day.
Seriously, where do comments like this keep coming from?
For example, the FCC regularly receives complaints against pretty much every broadcaster that they are biased and the FCC regularly dismisses those because broadcasters are supposed to be allowed to take positions that politicians may disagree with.
Until now. The new FCC chairman reinstated complaints against all the major network stations that were alleged to have a liberal bias and is now subpoenaing them, and did not reinstate any complaints against major network stations (e.g., FOX) that allege conservative bias.
1. I should be able to deduct the same sorts of things from my individual income that corporations routinely deduct from their income.
If a corporation can legally shield all of their income from taxes, why can't I shield all of my income from taxes? Corporations can deduct the costs of all the things they have to do to make money and do weird depreciation tricks, but I cannot deduct the costs of all the things I must pay for in order to make my own income.
Then, as a citizen, you have tax cuts for kids, for school, for various small enterprises, for local this and that by jurisdiction, you do get depreciation on lots of goods. I could go on for the thousands and thousands of pages of personal income tax law.
Being ignorantly of a thing to arrive at outrage is still ignorance.
Everyone contributes.
The vast majority of corp pay income tax, unless (and this is nearly never many years in a row) they have such tax rollovers from prev year.
Now, they also still pay property taxes, enemployment taxes, half your SS, taxes on goods bought, and a host of other taxes, independent from income taxes.
All your outrage is simply ignorance of how taxes work, and so far you’re wrong about all your unfounded belief. Go read how taxes work, learn to read SEC filings. CBO has detailed solid reports prepared covering all this stuff.
When you think something about taxes is outrageous, it’s going to be because you don’t understand them, and you’ve filled your head with tripe from sources designed to mislead you. Read actual tax law and filings, and all this misunderstanding will go away.
Of course, you can't literally compare corps to people. Their profits are ultimately paid out to individuals and taxed again. People don't exactly have revenues. So I'm not saying the current way is wrong, but the statement you're responding to isn't ignorant.
[0] official IRS policy is that "commuting" expenses are not deductible, but practically you declare the principal place of business as your home, and then anywhere else you go is no longer commuting.
1. tax credits are legitimate. But who is using it and on what matters. getting hundreds of millions of tax credit to make horribly constructed cybertrucks does not inspire confidence. But I did want more EV benefits (those are gone now. Alas. "Drill, baby, drill"
2. I don't really know enough about accelerated Depreciation to comment
3. Ownership of productive companies is good. Keyword: "productive". Tesla has been cutting staff, closing dealerships, and again with the cybertruck. "profitable" does not equate to "productive" in my eyes.
4. Yes, Journalism for the most part is in a battle with the current administration
5. Always the fun topic to talk about. As a concept, paying taxes is good. Any more deliberation into reality may as well be its own separate topic. I do personally think corporate needs to provide more taxes, but Trump clearly disagrees this year (corporate tax cut from 21% to 15%, I believe).
$300M in tax credits is basically the same as them paying $300M in tax and then getting a big check from the government for meeting some goal. I don't think it should be treated as any kind of avoidance on behalf of the company. Instead, check if the government paid that money for something useful, and if they didn't then blame the government.
Given the level of corruption in the US government in general and the role of Musk in the current administration in particular that doesn't seem unlikely to me
This is specifically corporate income taxes.
I mean they didn't just decide not to pay taxes. They followed the tax law. They accelerated some depreciation to take it now at the expense of a higher tax bill later. They took advantage of some government credits.
Corporate taxation is only one point of taxation. They pay payroll taxes, they pay sales tax on equipment they purchase at their factories, their employees pay taxes when they get paid.
Low corporate tax rates are unpopular because the optics are bad, but it doesn't actually mean that money is flowing through the company and into their employees without taxation anywhere. As soon as they do nearly anything with that money other than buy more parts to sell, taxes are being paid.
Say a company spends $1 billion in 2024 to build a factory.
What is the "right" number of years (depreciation schedule)? 10? 5? 3? 1?
Whatever number N you pick, tell me why it's more "right" than N+1 or N-1.
Yes only a few companies could use this, but the main factor here is not really a trick. Any other company that sells electric cars and has 0-3% profit could do the same thing.
If you get a small tax credit per sale, and your taxes are 21% of 3% of your sales revenue, and that makes your taxes smaller than the credit, then you don't have to pay taxes.
The advanced depreciation only knocked out .5 billion from the 2.3 billion, and they'll have less depreciation in the next few years because of it. I'm not very worried about that being an exploit.
> Tesla's profit margin is more than 3%.
2.3 billion out of 97.7 billion revenue is less than 3 percent.
But another page is saying 2.3 billion is from the quarter, not the entire year? Then that changes the math some and you can counterbalance a bigger single digit profit with those credits. But if your actual worry is the depreciation then it's not worth analyzing this much further.
> Tesla supposedly got $300M in tax credits, which is much less than 21% of their profit.
It's not much less, it's a little bit off but we're using very rounded numbers to start with. When all the numbers are rounded to the nearest .1B, the napkin math being off by 78M just gets a shrug from me.
Most states exempt equipment purchased by manufacturers from manufacturing their products from sales tax. I believe many also exempt raw materials that go into those products.
That Tax Foundation says [1] that both California and Texas (which I believe are the states where Tesla has factories) are states with such an exemption, although I'm seeing other sources that say that California's is just a partial exemption.
[0] https://www.npr.org/sections/money/2012/10/18/163106924/a-ta...
But corporations are people..? Can't have it both ways right :/
Unless I'm missing something here.
Google "Citizens United v. FEC" Supreme Court decision.
Conveniently, they are people only when it comes to corruption and influence. But not when it comes to rules or punishment (like if a corporation killed people, it should be possible to give it a death sentence).
? I don't see what's insane about this
That's just, like, your opinion, man.
Seriously, they're two entirely different classes of things. One is an inert physical object, the other is a legal instrument that can collect and retain money, and shelter its shareholders and employees from legal and financial outcomes.
If I asked the average person on the street, which of these two things do you think would be more likely to pay taxes, they would look at me like an idiot.
The citizen's united ruling of 2010 disagrees with you, in the US at least.
>So who pays the corporate tax?
I don't know. the same one who pays for campaign donations. IANAL.