Use 'Em If You Got 'Em: Channel Earnings Through Low Tax Havens

One of the best at doing that: Microsoft. Link here.

Microsoft is straightforward about the core reason for its lower tax bill: It is increasingly channeling earnings from sales to customers throughout the world through the low-tax havens of Ireland, Puerto Rico and Singapore.

Microsoft's pre-tax profits booked overseas nearly tripled over the past six years, to $19.2 billion in the fiscal year that just ended, from $6.8 billion in the year ended in June 2006, according to company filings. By contrast, its U.S. earnings have dropped, to $8.9 billion from $11.4 billion in the same period. Foreign earnings now make up 68 percent of overall income.

The change is fueling its shrinking tax bills. According to its 2010 annual report, by keeping a good chunk of foreign earnings away from the U.S., Microsoft has accumulated $29.5 billion overseas -- and that is before the impact of its last financial year.

Smoke 'em if you got 'em. Meanwhile tax those corporate jets. Tax "Big Oil." Tax those making over $250,000.