The only sane argument to be made against this practice is that governments should make their tax systems more favourable to companies operating in their jurisdiction so they have no reason to move their profits to a more favourable jurisdiction.

Australia has, if I understand correctly, the highest corporate profit tax rate in the OECD. Higher than New Zealand, the US, Canada, the UK, Ireland, Japan, Turkey, China, Greece, Belgium, Denmark, Sweden, Iran, Zimbabwe, Iceland, Finland, Ukraine, Hungary, Qatar, Iceland, anyway…

Why wouldn’t you expatriate your profits and retain your loses as a multinational operating in Australia?

Australia is increasingly and rapidly driving itself toward a future where higher taxes result in lower tax revenues as individuals, business, and corporations pick up their capital and leave for jurisdictions with more favourable regulations and taxation.

Governments shouldn’t aim to maximise taxation, that always kills innovation and the entrepreneurial spirit. They should aim to optimise taxation to a point where businesses flourish and infrastructure is built and maintained, and otherwise generally not be heard from much at all.

Pandering to the corporations is just a race to the bottom. There was recently a real and respectable attempt to address this with a global minimum tax of 15% but that has been stalled, at least the last I heard of it.

What value do they extract? They provide a good or service to denizens. Unless of course you believe in a serf model of government in which people are an asset of the state and everything should serve the states goals.

This is increasingly, and worryingly, becoming an ideology people are being swept up by.

It doesn’t help that there are Card Carrying Socialist activists in our public school system in Australia, indoctrinating kids in to a politically and economically bent out of shape ideology.

I don’t believe many Australians are aware of just how dangerously few steps away from the mouldy bread and rotting fish head soup lines version of “equality” we really are.

Since when has government, of any sort, been a reliable arbiter of truth or wisdom?

P.J. O’Rourke would be turning in his grave.

Giving money and power to government is like giving whiskey and car keys to teenage boys.

Socialists in Schools: https://www.victoriansocialists.org.au/campaigns/socialists-...

The dangerous ideology is that giving money and power to corporations is any better than the government.

The government in a free democracy is ultimately controlled by the people, is supposed to (and usually does) work for the people, to protect the environment where that is necessary, protect people from being exploited by too powerful corporations, etc.

None of this is socialism, this is in fact the system that made the US great in the years after WW2.

Also I am neither Australian nor socialist.

I honestly don’t understand how you believe this to be a reasonable response. It does sound like a bad faith argument, an attempt at ad hominem.

When an entity operates in an area but optimises the financial structures in such a way as to siphon all the profits out to another area, that is extracting value that used to remain in the area.

That service or goods are provided has no bearing on the matter.

An entity provides a service to people that necessarily produces a consumer surplus. Say you pay $2 for a cup of coffee, you obviously value it at least $2 otherwise you wouldn't buy it, but likely more. Suppose you value it at $3 (i.e. the company could charge up to $3 and you would pay), by allowing the entity to sell it to you at the market rate of $2, they created $1 surplus value to you.

The same works on the producer side. It typically costs them less than the market price to produce the product.

This is basic economics and kind of wild I have to explain.

This is firstly not a response to the value extraction issue.

Secondly, you don’t need to explain this here. Rather read up better, because this theory requires a fair market which fails when some participants can avoid taxes.