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this post was submitted on 23 Feb 2024
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Games
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Don't get me wrong, I'm just curious how it works because I keep seeing it mentioned, and it's just frustrating that nobody ever explains it!
Yes I get that part, but I don't get how they are better off with that? If a company has a profit of 10 million, then they burn 2 million on a manufactured loss, they only have to pay tax on 8 million of profit. Makes sense. Let's say the imaginary tax here is 50%. They could have got 5 million after tax, but after this maneuver they only get 4 million after tax. So it doesn't make sense. What am I missing?
Your comment is spot on but doesn't answer my question.