What's wrong with paying taxes?

[Louis VI the Fat]

Yes Don, Gawain is absolutely right. I just don't think it excludes what Kafir and I are saying. Yes, all costs are expenses for companies and are paid for by the consumer in the end. But not all of the income multinationals generate are made in the west. And not all the costs the western consumers make end up as costs for multinationals.

You want to produce your cartoon character clothing line in Southeast Asia? Fair enough. Moved your R&D department to India? Good for you. You've left nothing but a skeleton company located only in name in
America? Fine.
You left your headquarters in Illinois just so you can come crying to the US government about infringments on the intellectual property rights of your products by the Chinese? Well fork up.

Stability and rule of law is a service just like electricity or running water. With good reason, we send companies a bill for those too, even though in the end those bills are paid for by the consumer also. The good reason being that it produces the real costs involved in operating a business for each individual company.

[Don Corleone]

You want the US government to charge corporations for protecting patented intellectual property?

If a company relocates it's design and manufacturing overseas, that's less income tax the US receives and more that the foreign countries receive. Unless the CEO & the rest of the board are moving to New Delhi themselves, any money they wring out of that relocation is still going to be taxed while they're living large in their upper East Side penthouse. In doing this, tax policy is more direct and the effects (and therefore the merits) of the current taxation/spending programs are easily observable. Either corporate leaders think they're getting a good bang for their buck, and they take their income while living here and pay their taxes or they don't, and they relocate.

The situation you describe, where a corporation receives services when it's not paying taxes doesn't happen with individual tax payers. If Lee R. Raymond, CEO of Exxon Mobile decides he doesn't want to pay American taxes and moves to Shanghai, there's not much he can do to force the US to provide him with public services over there.