MM, you do need to read more slowly. I didn't write that the QUALCOMM employees pay $2bn to the tax people. Take another look. I said that of the dollar notes which arrive from overseas with a little red dot on them, about half of them end up in the tax coffers, [we are imagining this - I don't think there really are little red dots though literal-minded people [perhaps like CB] might go looking for them].
This is approximate and a WAG, so don't do arithmetic too precisely [unless you want to figure out precisely how much it is].
Let's follow the dots.
USR$100 comes to Q! [R = red-dotted dollars]
I guess about 50 go to employees. Of those, about 17 go directly to the tax people as income tax.
With the remaining 33, the employee buys a dinner, a gas of tank, movie, mortgage on house, car payment etc. So, let's check what happens at the restaurant [it better be a cheap one]. They pay USR$10 for a meal. Staff get paid about half that amount, so they get USR$6 of which they pay USR$2 to the tax people. [The restaurant also gets some profit and pays tax on that as well as paying the raw material suppliers]. The waiter takes the remaining USR$4 and buy a Subway during a trip. The Sub staff get about half the money, USR$2, of which they pay about USR$0.70 to the tax people, leaving USR$1.30 which they spend which gets about another 20c for the tax people and we can forget about that decreasing chain once it's down to that level, though it does continue for a total of about... 17 + 2 + 0.70 + 0.20 = about USR$20 so far.
Now, the Q! employee spent USR$10 on the meal, so they have another 23 to spend. Let's guess that a similar rate of tax applies down other spending chains [some are high due to duties and some are lower].
Anyway, if you follow all those red-dotted dollars, you find that about half of them end up in the government till. Don't forget to go back to the 50 which QUALCOMM didn't give their employees, but gave to suppliers, shareholders etc. You need to track those too, because a lot of those pretty quickly end up in the tax till. Shareholders pay tax on dividends or capital gains. Suppliers pay tax on profits and the suppliers' staff pay income tax and spending tax etc...
Some circulate without ending up in the tax till [though statistically, they all go through the government's till in the end because USR$ and US$ are fungible].
If Q! wasn't selling those great CDMA services, there would not be any of those USR$ coming to the USA and USS Enterprise would be diminished.
So, QUALCOMM brings in about USR$4bn and of those, about USR$2bn pretty soon end up in the tax till. That's why government spending is about half of GNP. They are bleeding the economy in all directions. The government can't spend half of GNP out of thin air [NZ spends over half, the USA spends less than half - I think].
Follow those red-dotted dollars and you'll be surprised how quickly and how many of them flow into the tax department.
Read that previous post again and not so fast this time...you'll see I didn't say the employees pay $2bn to the tax people.
Most of the $4bn comes from overseas, so USS Enterprise is making a fortune from CDMA. Don't forget that Lucent, Motorola and others are selling CDMA gear overseas and although they don't make profits [so far] their employees are paid from CDMA income and pay tax on their incomes and so on down the multiplier chain.
CDMA will be worth $100s of billions to USS Enterprise tax people over the next few years. Q! royalties and sales are a small portion of the total spent on CDMA. The whole Nasdaq is full of such companies. Such as Microsoft. All pumping vast money into USS Enterprise. The scale is stupendously huge and it is NOT reducing. It is increasing.
Mqurice |
