indago
02-04-2015, 09:57 AM
Journalist Patricia Cohen wrote for The New York Times 3 February 2015:
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When a Montana judge ordered Hyundai to pay $73 million in punitive damages last year to the families of two teenagers killed in a car crash, she found that the South Korean automaker had “recklessly” ignored scores of warnings over more than a decade about the steering defect blamed for the accident. But even if Hyundai is eventually forced to pay the full amount of the damages, the punishment could be substantially reduced through a tax loophole that permits the company to save millions of dollars by deducting any court-ordered punitive damages as an ordinary business expense. ...“This tax loophole allows corporations to wreak havoc and then write it off as a cost of doing business,” said Senator Patrick Leahy, Democrat of Vermont...
“That undermines the whole point of punitive damages.”
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article (http://www.nytimes.com/2015/02/04/business/when-a-company-is-fined-taxpayers-often-share-the-punishment.html?ref=todayspaper)
One commenter wrote:
The fact that the management of a company, sat on repairing a known defect which can cause death or serious issue for years rather than fixing the defect for years resulting in the deaths & injuries of many raises some following issue:
This was a felony i.e. reckless endangerment [A person or persons knowingly commits the crime of reckless endangerment if the person recklessly engages in conduct which creates a substantial risk of serious physical injury to another person] and not a non-violent white collar crime with only a punitive cash settlement beared by the shareholders and society as a whole.
- The fact as stated that the fine could be deemed as a tax deduction. If corporations are obliged to practice corporate citizenship can deduct fines of this nature then why can't citizens deduct fines ranging from parking tickets to tax fines & penalties.
- The fact that some of these corporations while receiving huge bailouts, etc while knowing of their bad behavior of not reporting this issue to the NHTSA is alarming and not identifying the future liability in financials reported to shareholders is also alarming adding credence to the too close relationship between government officials & corporations resulting from campaign contributions, etc.
All this money lost that could be used for the repairs of our infrastructure, reducing the national debt, etc.
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When a Montana judge ordered Hyundai to pay $73 million in punitive damages last year to the families of two teenagers killed in a car crash, she found that the South Korean automaker had “recklessly” ignored scores of warnings over more than a decade about the steering defect blamed for the accident. But even if Hyundai is eventually forced to pay the full amount of the damages, the punishment could be substantially reduced through a tax loophole that permits the company to save millions of dollars by deducting any court-ordered punitive damages as an ordinary business expense. ...“This tax loophole allows corporations to wreak havoc and then write it off as a cost of doing business,” said Senator Patrick Leahy, Democrat of Vermont...
“That undermines the whole point of punitive damages.”
--------------------------------------------------------------------------------
article (http://www.nytimes.com/2015/02/04/business/when-a-company-is-fined-taxpayers-often-share-the-punishment.html?ref=todayspaper)
One commenter wrote:
The fact that the management of a company, sat on repairing a known defect which can cause death or serious issue for years rather than fixing the defect for years resulting in the deaths & injuries of many raises some following issue:
This was a felony i.e. reckless endangerment [A person or persons knowingly commits the crime of reckless endangerment if the person recklessly engages in conduct which creates a substantial risk of serious physical injury to another person] and not a non-violent white collar crime with only a punitive cash settlement beared by the shareholders and society as a whole.
- The fact as stated that the fine could be deemed as a tax deduction. If corporations are obliged to practice corporate citizenship can deduct fines of this nature then why can't citizens deduct fines ranging from parking tickets to tax fines & penalties.
- The fact that some of these corporations while receiving huge bailouts, etc while knowing of their bad behavior of not reporting this issue to the NHTSA is alarming and not identifying the future liability in financials reported to shareholders is also alarming adding credence to the too close relationship between government officials & corporations resulting from campaign contributions, etc.
All this money lost that could be used for the repairs of our infrastructure, reducing the national debt, etc.