Google's Tax Loophole Scheme Is Legal, But Is It 'Evil'?

By funneling revenue through subsidiaries in foreign countries, Google exploits international corporate tax law to shave more than $1 billion a year off its final tax bill.

The government knows what Google is doing and nobody's accusing the company of breaking the law. But for a company that marches under the banner "Don't Be Evil," this is awfully evil-ish behavior, writes Tim Fernholz of The American Prospect.

This reminds me that a few months ago, I posed a question to readers: Is it hypocritical to call for higher taxes and also try to avoid paying them? I imagined a liberal who'd voted for an administration that promised higher taxes hiring H&R Block the next year to massage the law such that he would pay the fewest taxes possible -- under the law. Most of the commenters said it was intellectually inconsistent to call for higher taxes and also seek shelter under the law.

I suspect these commenters would say that Google is well within its rights to go to any lengths possible (legal) to shrink their tax bill. My question is: Should the same apply to father who wants Americans to pay a higher effective tax rate but also wants to seek options to save as much money for his family as the law allows? If  exploiting tax loopholes is legal and unevil for a company, shouldn't it be legal and unevil for a man or woman, regardless of their position on taxes?

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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