Originally Posted by
Timbo
Here's an accounting reason they would like to trade our next pay raise for profit sharing: Taxes.
If instead of giving us say, $1 Billion in profit sharing, they gave us a $1 Billion pay raise, they would pay income taxes on $1 Billion -less- profit.
We see it as a wash, either way we get $1 Billion, but if it's profit, they have to pay income tax on it first, then give it to us too. The bankruptcy income tax write offs are about to expire, at a time when the company is making unheard of profits, so you know they are trying to limit their next income tax bill.
Could that be a reason the company is investing so much in offshore airlines. Could they park some of the profits offshore and avoid the 35% corporate income tax rate a la Apple? If the company kept that cash overseas, how would that affect our profit sharing calculations or ability to extract compensation increases?