Given that Ritchie is mentioned here as a source we know that this story is going to be codswallop:
None of this is illegal, however absurd it appears. But it is highly unethical, especially when the chairman is exhorting countries to hand over taxpayers’ cash to his pet causes – and it certainly tarnishes that saintly image. According to tax campaigner Richard Murphy, Microsoft avoids a sum in tax equivalent to more than 3% of the global aid budget. Despite this, Gates was star speaker at the IF campaign rally against hunger in Hyde Park last summer – although one of the four central issues was supposed to be corporate tax dodging.
Gates, when pressed on his firm’s tax policies, gave the usual glib response that they play by the rules. “If people want taxes at certain levels, great, set them at those levels,” he said. “But it’s not incumbent on those companies to take shareholder money and pay huge sums that aren’t required.”
The background argument being that Bill Gates might give his Microsoft money to charity but it’s terribly naughty that Microsoft doesn’t pay more tax before he gets it.
The problem with this argument is the old one that Ritchie always has with corporate taxation: tax incidence. The company doesn’t bear the burden of the taxes. It’s either the investors in the company or the workers in the economy in general who do. And let’s here, take Ritchie’s viewpoint on this. Not because he’s correct but just because it’s interesting to see the effects of his beliefs.
That is, that it’s capital, the investors, who bear the burden of the corporate tax. So, if Microsoft had paid more tax then the shares Bill Gates owns would be worth less. There would therefore be less in the Gates Foundation to spend on things like a malaria vaccine. And it’s very difficult indeed to take the position that more would have been spent on poor countries if Microsoft had paid more taxes: foreign aid budgets are not set that way as we know.
So, Bill Gates keeping the money out of the hands of the politicians and their plans, and spending it instead directly on aid to the poor would seem to be increasing the amount of money spent on said poor.
But, according to anti-poverty campaigners this is bad apparently.