Should we boycott Burger King?

[TheKlown]

http://fortune.com/2014/08/28/is-burger-kings-move-to-canada-a-raw-deal-for-u-s-taxpayers/

[Spedmallet]

At 9/1/14 08:32 AM, Korriken wrote: Well, the government could solve this issue, but they won't.

Poor burger king, with it's millions of dollars of revenue, cheap products and minimum wage labor

[Spedmallet]

Also yes.

Not that I don't already avoid fast food like the plague.

[Spedmallet]

At 9/1/14 10:17 AM, X-Gary-Gigax-X wrote: But those companies aren't being patriotic!

I'd feel bad if any portion of that tax revenue were taken from employees and benefits

[Camarohusky]

At 9/1/14 10:24 AM, Spedmallet wrote: I'd feel bad if any portion of that tax revenue were taken from employees and benefits

I fyou think ANY of their tax savings are going to go to paying employees more, holding onto employees longer, or opening up new stores, I have a beautiful ocean front villa in Arizona I'd love to sell you.

I hate this move. Sure companies can point to stats about high taxes, but who the fuck cares? It's not like they'd use their extra money in a productive manner. All it does is pad the profits or payouts to people who already have a ton of money. If those corporations could prove to the US people through good faith acts that lower taxes would ACTUALLY trickle down, I would be a hell of a lot more amenable to lowering their taxes. As it is right now, their should not only by a 40% rate, but a huge penalty for leaving the country (80% of gross income for the 10 years after leaving).

It's well known that tax dollars go back into the economy at an extremely higher rate than private dollars, especially high end private dollars.

[aviewaskewed]

At 9/1/14 04:26 AM, TheKlown wrote: http://fortune.com/2014/08/28/is-burger-kings-move-to-canada-a-raw-deal-for-u-s-taxpayers/

Most people covered my thoughts. I think the idea that millionaires and billionaires who are at the point where they have so much that they're crying about an extra million or two they could never honestly spend even if they were bound and determined to, are disgusting. The US has one of the worst poverty levels in the developed world (and yet is the richest nation) BECAUSE of shit like this. People who have more then they'll ever need, taking from people who are struggling to survive, and then asking for more is just flat out immoral.

Now let me put the mod hat on for a tick: I am NOT going to tolerate anymore threads where the OP is just a link to an article or a youtube video! I have no problem with links, especially in this forum where we ask for facts to be sourced. But simply posting a link with no argument, opinion, etc. to follow it is not ok and I WILL delete it on sight in the future. I had one thread I did that too already today and this one isn't going to be deleted because some respectable regs are posting here and mitigating the terrible way this was started. Please keep this in mind in the future. It's YOUR forum too, respect it.

[aviewaskewed]

At 9/2/14 12:13 AM, TNT wrote: Other than their headquarters are in Canada, I don't think it will change much of anything other than a minor impact to the American Economy, if any at all.

Again, the reason people are so uptight is because they will most likely be pocketing these profits. I state yet again, as someone who has LONG worked in sectors like the low wage world of BK and having friends who actually DO work for the chain itself or chains similar, you are not talking about folks who would move their headquarters for a lower tax rate to say "now I can give employees that better wage they so richly deserve!" it's like the theory of Reagonomics: It's against the Capitalist principal. It suggests that the rich are trying to get richer to give something back....which is fucking laughable if you bother to look at their behavior for any length of time. It's another example of the rich and the greedy taking advantage of ways to continue to get richer and the poor to get poorer. Boycotting won't stop it, legislation would. Unfortunately it's a sell that'll never work in this country.

[aviewaskewed]

At 9/2/14 12:43 AM, TNT wrote: Fair point. When I mentioned that I didn't understand why they were so uptight about it, I rushed and didn't evaluate possible reasons that would make sense.

Happens to all of us. I think it's especially easy to do that if you haven't worked for corporations like BK or know people who do. When that kind of work is your life, or a big part of it, you're more attuned to the issue and it's implications more immediately.

Considering Burger King, you're probably right. They will more than likely not use it to pay their employees better wages.

I can guarantee you they won't without some sort of legislative enforcement to do so. I mean, why do you think we have a "minimum wage" in the first place? It's been true of big corporations since the turn of the 20th century and before that the richer the ownership becomes, the less they want to pay the people whose backs and labor they're getting the money from. It's just human nature.

However, it could be possible that they may use some (not all mind you) for future locations, which in turn will hire more people. Still sucks that it's probably minimum wage jobs though.

Of course it's minimum wage type work, and management only get's paid slightly better. That's my point, they'll open more locations, irregardless of this move, but they'll still offer crappy, low paying jobs and contributing to the wealth gap that is eventually going to have major ramifications on this country in the most negative of ways.

The goal of any business is to make profit, and if they can make more profit by moving out of country, then they made take that route.

Of course they will. Companies have been doing it for years and will continue to do so for as long as they can.

Legislation might be more effective than boycotting, but I have to wonder what it would take to make other corporations stay for good.

I just mentioned it. Because the only other alternative is to lower the tax rates again, kissing their asses and making them happy, but continuing to create more financial hardship for the rest of the nation. At some point, governments have to stand up and say to these companies "you are not bigger then us, you are not bigger then the consumer" and start making them do the kinds of things that are in their own interest (better wages, better benefits, happier employees with fatter wallets who can then reinvest in the business both in terms of buying product, and maybe even stock based investment). Treating the employee as nothing more then an expense or a necessary evil is NOT a viable long term option and is a self-fulfilling prophecy of slitting one's own throat.

They could add a stiff penalty for moving to another country, but to some of them, it might be worth the investment. They could raise the minimum wage, but they could lay off a lot of employees, raise the prices on their menu, or both.

Which of course has been the hostage effect that I've been talking about that frankly it's going to require stiff, oneirous to some legislation to stop them from doing. We've tried de-regulating and going with the idea that these are "good people" who are "job creators" and that somehow, even when demonstrably untrue, all jobs are a-ok things of equal merit. It doesn't work, it's time to realize that, put on the big boy pants, and make these people contribute more and give more back to the society and the system that have allowed them the opportunity to do so well.

[TheMason]

Of course BK is going to pocket some of the profits. However, this does make the Brazilian-owned American-brand that just bought a Canadian-brand more competitive.

This is a rational move.

However, I think one of the questions we should be asking is: why are countries like Canada and those in the EU more attractive to businesses than the US? What are we as a nation doing wrong to make us less competitive for businesses to move here?

I mean when our corporate tax rate is among the highest...and we tax profits made in other countries (not many, if any other countries do this)...I would worry about the sanity and competency of any corporation to stay in the US.

[Feoric]

At 9/2/14 08:15 PM, TheMason wrote: I mean when our corporate tax rate is among the highest...and we tax profits made in other countries (not many, if any other countries do this)...I would worry about the sanity and competency of any corporation to stay in the US.

Since you're so concerned, compare and contrast the tax rates companies are paying with and without deductions and tax loopholes. Once you've done that you should stop worrying about capital flight.

[SadisticMonkey]

At 9/1/14 10:47 AM, Camarohusky wrote: I hate this move. Sure companies can point to stats about high taxes, but who the fuck cares? It's not like they'd use their extra money in a productive manner.

What PRECISELY is this based on?

Do companies not ever expand? Open new office/branches/stores? Do they not invest? Have you ever actually read an annual report of corporate financial statement before?

All it does is pad the profits or payouts to people who already have a ton of money.

Non-invested profits can be used for executive income or shareholder income.

In both cases, the money is taxed, and in the latter case, the recipients are not necessarily rich.

It's well known that tax dollars go back into the economy at an extremely higher rate than private dollars, especially high end private dollars.

"pretty well known" isn't going to cut it here.

And "going into the economy" isn't all equal. It takes many forms.

Rich people don't lock their money away in vaults and swim in it scrooge mcduck style. Most of their net wealth is in the form of investments, which is 'going into the economy'.

Government spending can get money into the economy in a number of ways. Welfare spending is obviously a big one. Regardless of how important you think it is for the government to provide financial support low income individuals/families, from a 'good for the economy' perspective this is the least productive kind of spending. The best kind is investment, which is what leads to economic growth.

[SadisticMonkey]

At 9/2/14 08:26 PM, Light wrote: Most corporations have no trouble evading corporate taxes

You have knowledge of widespread corporate tax evasion? Does the IRS know about this?!

You heard it here first, folks!

Even if they didn't do so, it's not as if they wouldn't try to find ways to maximize their profits at the expenses of their workers and/or the American taxpayer.

Right, and in an environment where the government doesn't erect barriers to entry and doesn't engage in an assortment of cronyism to protect established/dominant firms, competition keeps this profit-maximizing behavior in check.

[Feoric]

At 9/3/14 09:16 AM, SadisticMonkey wrote: You have knowledge of widespread corporate tax evasion? Does the IRS know about this?!

Yes.

[Feoric]

At 9/3/14 04:43 PM, X-Gary-Gigax-X wrote: Why isn't the tax rate 99% like, everywhere?

If you make 100 million, and 99% is taxed, you still have a million left over.

I know you're being tongue in cheek but taxes don't work like that. We have tax brackets, so tax rates only apply to certain sections of income. The top marginal tax rate was well over 90% following WWII. It's strange to see conservative baby boomers proselytize their belief that the 50s was the golden age for America when that's also when we had all time highest tax rates -- maxing out at a whopping 94% for high income earners.

[Gozeta]

Why boycott? It isn't the first company and it won't be the last.

[TheMason]

At 9/2/14 08:26 PM, Light wrote: You know, I keep hearing this talking point from conservatives and there doesn't seem to be any truth to it. Most corporations have no trouble evading corporate taxes and are more profitable than ever. Even if they didn't do so, it's not as if they wouldn't try to find ways to maximize their profits at the expenses of their workers and/or the American taxpayer.

At 9/2/14 08:32 PM, Feoric wrote: Since you're so concerned, compare and contrast the tax rates companies are paying with and without deductions and tax loopholes. Once you've done that you should stop worrying about capital flight.

So...

President Obama is talking about this move to Canada being about evading their 'fair share' of taxes...

...but now both of you are claiming that there are loopholes and other means of reducing tax liability...and I looked it up (came across a top 10 list on Huff Post)...and suppossedly the high corporate tax rate in this country is negated by these loopholes and legal evasions.

So please pardon the cognitive dissonance...BUT it would appear that:

a) the Left's logic on this one contradicts itself.

-or-

b) Obama is either lying or completely ignorant of the business environment in this country.

Either way it would be irrational to try to untangle an argument that collapses upon itself or foolish to pay attention to someone who is either a fool or liar.

Thus my original point stands:

What is it about the American business environment that makes corporations want to leave?

This isn't about Left or Right. I can honestly give Bill Clinton high marks for his attention to detail to when it came to economic issues. It is about keeping a robust economy in this country that is capable of lifting all boats.

So where are we going wrong where we're no longer as competitive as we once were? How can we get back on track.

[Feoric]

At 9/3/14 08:36 PM, TheMason wrote: So please pardon the cognitive dissonance...BUT it would appear that:

a) the Left's logic on this one contradicts itself.

-or-

b) Obama is either lying or completely ignorant of the business environment in this country.

For starters, my main point, which was "making a big deal about the nominal tax rate is meaningless," and the statement "Burger King moved to Canada to avoid their share of taxes" are not mutually exclusive things. The effective tax rate on U.S. Corporations is ridiculously low. The fact that Burger King most likely does not actually pay 40% in taxes after taking into account deductions and loopholes (they pay ~26% according to industry experts) does not necessarily mean they couldn't be paying even less if they had a Canadian address. Obviously BK thinks they'll have more money in their pockets at the end of the day, and one of the ways to achieve that goal is tax evasion. However, the move came about from purchasing Tim Hortons, so while they will probably pay an effective tax rate lower than what they would in the US, tax evasion was probably not the primary motive for the move, although I'm sure it was a consideration.

I can honestly give Bill Clinton high marks for his attention to detail to when it came to economic issues.

You shouldn't. Bill Clinton has an extremely large degree of culpability for causing the latest financial crisis.

[Camarohusky]

At 9/3/14 09:53 PM, Feoric wrote: The fact that Burger King most likely does not actually pay 40% in taxes after taking into account deductions and loopholes (they pay ~26% according to industry experts) does not necessarily mean they couldn't be paying even less if they had a Canadian address.

Wel, for one, a starting tax rate of 26% with no loopholes and a tax rate oopholed down to 26% are not equal. It costs good money to loophole out of that many taxes. My guess is that BK probably pays a combined $10 million to accounting and legal firms to get that. An expensive bill, no doubt, but still cheaper than the 40% rate. A tax bill starting at 26% doesn;t need the accountants or lawyers to get it there and saves that money.

[Feoric]

At 9/3/14 11:38 PM, Camarohusky wrote: Wel, for one, a starting tax rate of 26% with no loopholes and a tax rate oopholed down to 26% are not equal. It costs good money to loophole out of that many taxes. My guess is that BK probably pays a combined $10 million to accounting and legal firms to get that. An expensive bill, no doubt, but still cheaper than the 40% rate. A tax bill starting at 26% doesn;t need the accountants or lawyers to get it there and saves that money.

Yes, that is true, but I'd rather call "tax accountant fees-avoidance" just "tax avoidance." The end result is still the same as far as the federal government is concerned. At any rate I'm not particularly convinced there's any malfeasance on behalf of BK. I'm absolutely sure they're loving the Canadian rates considering how much they've lowered their effective rate here in the states, but to say they moved to Canada purely because of that then you have to logically conclude that they dished out 11 billion dollars to save a few million per year, which is a little bit ridiculous. This was obviously a business decision to expand into the high margin fast casual/coffee chain businesses. The fact that Tim Hortons is based in Canada is incidental.

[Camarohusky]

At 9/4/14 02:26 AM, Feoric wrote: but to say they moved to Canada purely because of that then you have to logically conclude that they dished out 11 billion dollars to save a few million per year, which is a little bit ridiculous.

You don't have to save that at all. There are two very likely possibilities here:

First, BK looked to buy Tim Hortons because of its massive popularity in Canada and ability to break BK into the breakfast coffee market to compete with McDonalds, Dunkin, and Starbucks. After the decision was made to acquire Tim Hortons and entirely separate decision was made to move HQ to Canada to save tax.

Second, BK could have been seriously mulling the idea of inverting. The possibility of acquiring Tim Hortons comes along and allows BK to get TH's big following and to break into the breakfast coffee market. The fact that TH is canadian and allows for easy inversion is just icing on the cake.

Either way, the Tim Hortons deal would have gone through regardless of the possibility of inversion. Therefore it is A-OK to treat the inversion as an independent act.

[Feoric]

At 9/4/14 09:58 AM, Camarohusky wrote: Either way, the Tim Hortons deal would have gone through regardless of the possibility of inversion. Therefore it is A-OK to treat the inversion as an independent act.

I think we're talking past each other. I'm not saying this isn't inversion, per se, but rather that BK didn't move to Canada strictly because they were paying too much tax in the US.

[SadisticMonkey]

At 9/3/14 12:31 PM, Feoric wrote:

At 9/3/14 09:16 AM, SadisticMonkey wrote: You have knowledge of widespread corporate tax evasion? Does the IRS know about this?!

Yes.

So, the IRS chooses not to punish companies for breaking the law?

[Feoric]

At 9/5/14 12:33 AM, SadisticMonkey wrote: So, the IRS chooses not to punish companies for breaking the law?

Aw, you think all tax evasion is illegal. That's cute. All of the tax dodges and loopholes were intentionally put in place by elected officials in order to incentivize some type of behavior, and they've been ruthlessly exploited by people who find any old excuse to take advantage of them, even if it doesn't involve meaningfully engaging in the behavior being incentivized. The IRS also isn't some nefarious shadow organization with unlimited sums of money and resources like a lot of you morons believe -- underfunding the IRS so they can't efficiently enforce the law was a tactic the GOP used in 2011 during the fiscal cliff drama and something they even passed right before summer recess. If the IRS doesn't have enough manpower and funds to go after fraud, guess what happens, genius?

[Feoric]

At 9/5/14 01:53 AM, LazyDrunk wrote: So if we boycott Burger King, can the gubbermint still banz sodaz?

Duh. Don't you know that banning the Big Gulp was a stalking horse for national gun confiscation?

[SadisticMonkey]

At 9/5/14 12:57 AM, Feoric wrote: Aw, you think all tax evasion is illegal.

Tax evasion and tax avoidance are different, dumbass. Tax evasion is by definition illegal.

[Feoric]

At 9/5/14 02:14 AM, SadisticMonkey wrote: Tax evasion and tax avoidance are different, dumbass.

lol

[Gontronic]

I've been boycotting Burger King for years. It's called having a healthy diet. Stop supporting shitty fast-food chains that just make people fat and unhealthy.

[Camarohusky]

At 9/5/14 11:48 PM, Gontronic wrote: I've been boycotting Burger King for years. It's called having a healthy diet. Stop supporting shitty fast-food chains that just make people fat and unhealthy.

You don't have many friends, do you?

[Gontronic]

At 9/6/14 12:05 AM, Camarohusky wrote:

At 9/5/14 11:48 PM, Gontronic wrote: I've been boycotting Burger King for years. It's called having a healthy diet. Stop supporting shitty fast-food chains that just make people fat and unhealthy.

You don't have many friends, do you?

I have a feeling that you're overweight. You must have pretty shitty friends if they force you to gobble down a bunch of garbage at Burger King.

[Ericho]

I was afraid they were going to be against gay rights like Chic-fil-a, but this is pretty bad too. As some people say, don't try to make everything political, but...yeah, I probably wouldn't recommend going to Burger King anyway.