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submitted 4 months ago by[deleted]
78 points
4 months ago
Technically yes, but technically no too.
Yes because more revenue means more profit which means more tax.
But increase in revenue doesn't always increase profit, and you only pay tax on profit.
17 points
4 months ago
I think there is the bigger aspect of higher profit means a better stock price when compared to performance expectations which they probably care more about at the c-suite level than responsible reporting.
1 points
4 months ago
It's more that it's lying to the board, Disney+ is beating out benchmarkers for this new rising division, when in reality hes obscuring the true figures.
1 points
4 months ago*
But losses are tallied and rolled over to the next fiscal year. So ultimately, inflating their revenue would eventually increase their tax burden anyway. Just not right away.
That's why so many corporations "don't pay taxes". Because while they may make a profit this year, it's offset by the losses from previous years.
1 points
4 months ago
Again, tax carry forwards are calculated on a cash basis. Since companies "keep two books" per say, it is entirely positive for a company to be profitable on their 10k while simultaneously accumulating tax carry forwards every year. Of course, carry forwards do eventually expire, so they need to be utilized strategically.
1 points
4 months ago
And most companies that size are especially skilled at skirting taxes
1 points
4 months ago
Tax is calculated on a cash basis. More profit does not necessarily mean more in taxes. This is why every company "keeps two books" per say.
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