TheBigShort
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Until of course, you read this. Social welfare for multi-million Euro corporate stockholders.
http://www.irishexaminer.com/breaki...-corporation-tax-for-20-years-ceo-807486.html
I'm not sure I disagree with this kind of policy. Suppose I lose 10 million this year then next year if I make 5 million I'm still at -5 million. Do you think I should be paying tax on a minus number just because it's a positive number over this year?
What's the alternative?
What's the problem so?The rules are clear in terms of offsetting losses in a financial year against profits made in another year.
Moved from a thread suggesting that social welfare payments should be cut]
What's the problem so?
http://www.thejournal.ie/aib-sale-e3-billion-raised-3459358-Jun2017/
The State made €3.4bn on the sale of the 25% of AIB. That means that at your figure of €1bn a year profit, it would take the State over 13 and a half years to get this back if they hadn't sold (€250m a year). With or without the tax treatment
BSAssuming a €1bn profit a year for next 20yrs.
Taxed at 12.5%. With 99.99% shareholding, the State, which bailed out the bank with your and mine taxes would ordinarily receive;
€875m profit + €125m tax routed through Revenue = €1bn.
But due to this special treatment, the €1bn profit would simply be collected.
AIB won't pay corporation tax for many years to come because of its large deferred tax asset (losses carried forward).
Nothing to do with the ownership of AIB and nothing to do with any "special treatment".
Your "calculation" is, frankly, nonsense.
By the time AIB is fully re-privatised it is highly likely that the State will have recouped the full amount invested in AIB.
Do you really think this valuable asset would have been ignored by the State's advisors when pricing the stock? Really?!I believe it is an excellent deal for the buyers, as profits won't be subject to corporate tax on profits for a long time as a consequence of losses carried forward.
No BS, it is nonsense. You obviously don't understand basic accounting.Simplistic yes, nonsense no.
No BS, they're not. The losses have already been incurred by AIB - hence the deferred tax asset.Tax payers are at a loss once again
No BS, it isn't. The public sale of AIB shares generated cash for the State that was used to pay down debt.It is a wealth transfer from Irish public finances to private corporate financiers.
Why privatise the largest bank in the State? Because the overwhelming majority of people don't want to live in a country where the State controls all capital.If it is that profitable, and if the State is the shareholder why privatise it?
Do you consider all private stockholders to be "gamblers and speculators"? Silly question - of course you do. Such a thing simply wouldn't exist in your communist utopia.Why hand it over to the speculators and gamblers once again?
Do you really think this valuable asset would have been ignored by the State's advisors when pricing the stock? Really?!
Do you consider all private stockholders to be "gamblers and speculators"? Silly question - of course you do. Such a thing simply wouldn't exist in your communist utopia.
Having secured a favourable tax position on these profits, the State has decided to sell that position instead of utilising it to the max.
Nor economics.. quite the handicap on a financial site like this..No BS, it is nonsense. You obviously don't understand basic accounting.
How exactly do you think that the State could have maximised the fact that AIB will not have to pay corporation taxes to the State for years to come without disposing of its holdings in AIB?
Nor economics.. quite the handicap on a financial site like this..
On the other hand, the State could have deferred the sale of the shares (foregoing the €3.4 bn for now) and instead utilised the deferred tax asset until it was exhausted.
the State has sold a 25% share for €3.4bn, at value which includes, as you quite right pointed out, this valuable deferred tax asset.
I assume you understand that a pro-rata element of the value of the tax deferred asset would have been reflected in the price paid for the shares in the public offering? Right?
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