Etsy, the premier marketplace for your arts and crafts wants and needs, is embroiled in controversy after a US tax policy group accused it of dubious tax practices that aren’t aligned with its B Corp status. Having that status means higher ethical policies are expected from the company, but it seems like it’s not living up to it because of the taxation issues. It’s been reported that Etsy altered the structure of its subsidiary in Ireland (which is somewhat more lenient towards corporations) so that it doesn’t have to publicly report certain financial data, thus giving it leeway to avoid taxes. The Brooklyn-based company joins the likes of Google, Apple, and Microsoft, firms that also have committed off-shore tax transgressions in Ireland.
Americans for Tax Fairness sent Etsy a letter that states this: “Etsy’s tax dodge is standard operating procedure among our country’s giant multinational corporations. We hope it will not be acceptable as a B Corp standard.” As a retort, the company had this to say, “we pay taxes at the local rate in the US, Canada, Ireland, UK, France, Germany, and Australia. We’re not offshoring or using a double Irish structure or any other elaborate tax scheme. This is a simple structure.”
Jay Coen Gilbert, who is a co-founder of the company B Lab, the one responsible for handing out the B Corp status, said that there’s no decision yet with regard to Etsy’s status or whether its tax practices rule it out.
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