A Swing and a Miss on Tax Evasion

A quick item to share from the Boston Globe today about the lengths companies will go to avoid taxes. This one from Raytheon is really over the top: The Waltham defense contractor [Raytheon] unsuccessfully tried to persuade a Massachusetts state tax board that because most of the company's work is done for the federal government, it should be exempt from paying state sales taxes on much of what it buys here - items as diverse as toilet paper, a juke box, and promotional gifts such as golf umbrellas, pins, and key chains. The Globe article has an interesting narrative about the crazy state of tax policy in America when it explains how items purchased for resale are taxed - it details why Burger King has to pay tax on paper napkins but McDonald's doesn't have to pay tax on the toys included in happy meals. It is worth reading and will crystalize for you how insane it is that Raytheon thought they would get $700,000 - plus interest! - from the state of Massachusetts for snow plowing and office supplies. This isn't the first time Raytheon has failed to win this exemption from MA. Seems like the Raytheon folks should stick to building missles and leave the tricky tax avoidance schemes to the experts. (h/t Government Inc.)
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