Microsoft tax policies in spotlight as WA state faces budget crunch |
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Microsoft tax policies in spotlight as WA state faces budget crunch
The current $430 million shortfall in Washington state's biennial budget could be more than made up if the state properly applied its tax laws to Microsoft, contends Jeff Reifman in a blog post that has been getting lots of attention today on Slashdot and the Guardian, among other sites.
Reifman, a former Microsoft employee who now spearheads NewsCloud and other projects, has written on the subject extensively in the past, but the current budget deficit casts the situation in a new light. Reifman estimates that Microsoft has avoided $707 million in Washington state taxes over the past 13 years by recording licensing revenue through an office in Reno, Nevada.
"Just by enforcing the state's existing tax law from 2008 onwards, we could reduce Washington's revenue shortfall by more than 70 percent," he writes. "Alternately, we could pursue the entire $707 million from Microsoft's thirteen years of tax dodging and cover most of the expected deficit going forward -- perhaps more if damages are awarded through litigation."
In this separate post, Reifman addresses common arguments against his stance, including the contention that the state is better off with Microsoft, whether or not the company fully pays its obligated business-and-occupation taxes.
We've checked with Microsoft and the office of state Attorney General Rob McKenna to see if they want to weigh in on the issue, and we'll update this post depending on the response.
About Todd Bishop
Todd Bishop is co-founder and managing editor of TechFlash. He has covered Microsoft and the technology industry for more than five years, most recently as a daily newspaper reporter and blogger based in Seattle.
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