>So let's say it was manufactured in Florida, shipped from New York, and sold in California, by your logic we should be paying state taxes in Florida, New York, and California.
I do not think that is an accurate example of what occurred in the article.
1. MS bought a Danish Company, (This is a taxable transaction),
2. MS then sold the assets (software) of the Danish Company to an MS subsidiary in Ireland, (This is a 2nd taxable transaction, but this is where MS "allegedly" sold the Danish Company asset at a price far below the market value effectively cheating Denmark out of taxes it would receive had the Danish Company sold its asset to an independent company)
Nevermind the obvious reasons "Why" MS engaged in the second transaction, MS is paying less taxes on the asset selling it from Ireland than in Denmark.
So to change your hypothetical to more accurately reflect the article - It is more like manufacturing a book in Florida, selling it to your own company in NY, who in turn sells it to someone in Florida just to avoid charging FL Sales tax which would need to be charged by a Florida company selling to a Florida resident. Of course at first glance this seems like a smart business move, but assuming the legal analysis of the article is true, then also imagine in your hypothetical there is a law prohibiting this type of transaction to its own subsidiaries in other states to prevent the circumvention of State sales tax.
I do not think that is an accurate example of what occurred in the article.
1. MS bought a Danish Company, (This is a taxable transaction), 2. MS then sold the assets (software) of the Danish Company to an MS subsidiary in Ireland, (This is a 2nd taxable transaction, but this is where MS "allegedly" sold the Danish Company asset at a price far below the market value effectively cheating Denmark out of taxes it would receive had the Danish Company sold its asset to an independent company)
Nevermind the obvious reasons "Why" MS engaged in the second transaction, MS is paying less taxes on the asset selling it from Ireland than in Denmark.
So to change your hypothetical to more accurately reflect the article - It is more like manufacturing a book in Florida, selling it to your own company in NY, who in turn sells it to someone in Florida just to avoid charging FL Sales tax which would need to be charged by a Florida company selling to a Florida resident. Of course at first glance this seems like a smart business move, but assuming the legal analysis of the article is true, then also imagine in your hypothetical there is a law prohibiting this type of transaction to its own subsidiaries in other states to prevent the circumvention of State sales tax.