Write a response/comment on the students essay.
Lexis Essay
In my opinion, I believe that the moves made by transnational corporations to avoid taxes with tax havens, manipulation of international investments, and transfer pricing schemes to be a terrible choice on them. Taxes are used to help pay for buildings, roads, and community funds. They arent something you can just decide not to pay.
Tax havens limit public disclosure most of the time. When you hear of secrecy jurisdictions, its because it is also known as a tax havens, but they will most likely deny being a tax haven. (Fitzgibbon & Hallman, 2022). This proves my point because secrecy is not telling people if you are paying taxes. This can be unethical because youre just being dishonest to say the least.
When a corporation uses transfer pricing schemes, they are taking their products and selling them to a different corporation. When they do this, they are trying to not have to pay taxes, or they are trying to make it so their tax rate is lower than the taxes they would have to pay if they sold the product from their original country of origin. There have been rules set in place, so corporations are deterred from using this method. One of the rules is what they call the arms length rule. (Transfer Price: What It Is, How Its Used, and Examples, 2022). This rule is where the company has to do a transfer of product with another company that has similar pricing, and it has to be done with an unrelated company. (Transfer Price: What It Is, How Its Used, and Examples, 2022).
Overall, I believe that the actions represent unethical practices done by the corporations. This is because of the lies, secrecy, and scandals that these huge corporations try to get away with as an excuse to not pay takes and rely on others who cant afford it.
References:
Fitzgibbon, W., & Hallman, B. (2022, July 19). What is a tax haven? Offshore finance, explained. ICIJ. Retrieved October 12, 2022, from https://www.icij.org/investigations/panama-papers/what-is-a-tax-haven-offshore-finance-explained/
Transfer Price: What It Is, How Its Used, and Examples. (2022, April 28). Investopedia. Retrieved October 12, 2022, from https://www.investopedia.com/terms/t/transferprice.asp
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