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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: DavesM who wrote (325443)	12/3/2002 11:54:49 PM
From: DMaA	Read Replies (1) \| Respond to of 769670

It matters because the tax was paid only once, not the 2, 3 or more times democrats consider "fair". Does it really matter, as long as the taxes are paid?

To: DavesM who wrote (325443)	12/4/2002 11:25:54 AM
From: DuckTapeSunroof	Read Replies (1) \| Respond to of 769670

Wheither it's a 'problem' or not (that Microsoft pays no federal taxes), is a matter of opinion... but that's exactly what Microsoft did, it shifted tax payments away from itself. (While at the same time - through use of the same mechanisms of stock watering - giving a false impression of it's financial health to investors.) As the Bill Parish Web articles make clear, by taking advantage of IRS regulations which allow stock options compensation to be deducted as an "operating expense", MSFT eliminated all Federal taxes. Since, on the other-hand, F.A.S.B. accounting rules do not require that this options compensation be counted when reporting "earnings", MSFT was able to put forth a false picture of it's financial health to investors. What is actually happening is that the stock is being massively watered down... and investor's stakes are being diluted away. If this dilution of the equity base is accounted for (as it surely will be in the future when the F.A.S.B. and the I.A.S.B. change their options accounting rules), then in several recent years, Microsoft actually had no net earnings at all. As far as MSFT not paying any federal taxes, I can't fault them for being aggressive. No one is required for reasons of patriotism to pay more taxes than they are legally obliged to do.... But, consider the effect their actions have on OTHER corporations who DO pay federal taxes. There is no 'level playing field' for free market competition. Companies who don't participate in this 'pyramid scheme-like' stock watering operation are disadvantaged by paying an average net tax load of 20%. The problem is in the loopholes in the rules. Congress deliberately skewed the corporate playing field and enabled this bamboozling of investors, and Sen. Lieberman is one of the prime conspirators here. The fact that this also shifts the burden of supporting the federal and state governments more firmly onto the backs of individual taxpayers... is perhaps also a not unexpected effect.