It often strikes me as quite the biased and one-sided take when a tax-paying entity is called out by the press for tax avoidance (NOT tax evasion, which is illegal). (yes TFA implies that Meta is breaking the law, I'm not talking about situations where entities break the law).
Previously we've seen "The Secret IRS Files" from Propublica as well as other coverage of tax avoidance that never resulted in tax evasion charges. Coverage wide enough that it's arguably safe to assume that no laws were broken because there was quite the demand for an enforcement response.
The funny thing is that a more accurate title for these pieces would be, "Federal Government Allows [tax-paying entity] a Massive Tax Break." And then the piece would be all about how the senate, congress, and president either explicitly wanted there to be this extreme tax loophole or was incompetent and allowed something they didn't mean to allow.
Folks are continually getting upset and riled up about players in the economic system instead of who and what makes the rules.
An analogous example: everyone got cranky about Martin Shkreli, mostly because he raised prices on Deraprim, although also because many would label him a brash jerk. But he went to jail for finance stuff, not raising prices. Why? Because raising prices in the way he did wasn't something the feds thought was illegal or wasn't something they thought he could be convicted of.
Folks get mad at Musk, Zuckerberg, etc... if they're doing something illegal, ok yea that makes sense. If folks are mad about actions that are legal, it makes zero sense to be mad at the actor. Be mad at the people/entities who created the legal loopholes and laws.
The problem is that law is a malleable mater and not all interpretation and use should be accepted, there is the spirit and the letter (don't know if it's an usual expression in english).
Dunno muchabout the US tax code but in the french tax code when there is a tax break there are practical conditions and an information intention / context by the legislative assembly in the law project. If french deputies create a tax break to incentivize research and you use it to get a tax break given investment in infrastructure not at all linked to any research, even if you match the practical conditions it's considered an abuse/diverting of the law and the french tax administration can completely cancel your tax break and you'll have to sue them in our administrative justice branch to change their decision.
That sounds like a nightmare for the business owner, and a huge boon for the legal industry (aka lawyers). Uncertainty/ambiguity in law is poisonous for someone trying to operate in the law, and that goes for everyone from big corp to individuals just trying to function in society.
These are called "General Anti-Avoidance" rules. The UK calls theirs a "General Anti-Abuse" rule but it's the same idea, probably better branding. The consequence of not having them is that huge corporations just don't pay your taxes because hey, what do you mean you wanted us to pay taxes, if you provide any means by which I can avoid that surely I must be intended to avoid it, right ?
It's not a "nightmare" unless your goal is to avoid paying taxes or the rule was very incompetently drafted. If you want to spend $5M figuring out how to avoid paying $5M in taxes and then moan that it was expensive, remember to factor in the price of the minuscule violins other tax payers will be needing.
Which is why people write articles like this... to draw attention to these ambiguities and how much of a boon they are for businesses with lots of resources to navigate and exploit them.
In the EU it's typical to keep to the spirit of the law, not necessarily to the letter. It makes it less game-able. If the tax break is for research and you use it for research and not "well, technically it could be considered research if you squint hard enough", you'll be fine.
It is perfectly fine to be upset about certain lawful behaviors because lawful does not mean good. This does also not exclusively apply to companies, people can be law abiding assholes. And it works in the other direction, too, sometimes unlawful behavior is good behavior.
But GP comment is not about how you feel about it. It is about where you direct that anger. If you dislike what a powerful entity does, well, we the people are supposed to have a recourse in our representatives. Why precisely is it that we feel like we do not?
I expect everyone to behave nicely even in the absence of laws. The reason that I am not killing people left and right is not because it is illegal to so but because it is immoral. The law is a last resort to disincentivize certain behaviors or hold you responsible after the fact, it is not what should exclusively guide anyone's behavior.
I waa with you, but no, this is where you lost me:
"If folks are mad about actions that are legal, it makes zero sense to be mad at the actor."
There are people with mindset "I will try to be an overall decent human being and maintain some awareness and empathy of others", and there are the "I will be as much of a selfish asshole as the legal system allows me to and wreak untold damage in the endless game of whack-a-mole".
I think in fact more of us should be gunning after the second kind :). To paraphrase you, It makes zero sense for me to be OK with fundamentally anti-social, anti-humanity humanoids.
I think you're both right, it depends a lot more on the specific situation. For example if Corporation A finds a loophole that allows them to dump toxic waste in the river, let's be pissed at both sides. If Corporation B reacts to incentives in the tax code to build an AI data center, you can be mad at data centers if you believe they poison the earth and waste resources, but you should also be mad at the government who created those incentives in the first place.
Why have you posted this comment on this article? This article is about something Meta is doing that the author considers illegal. Maybe IRS and courts will agree, maybe not, but either way your comment is simply irrelevant to the situation being reported here.
It's just fraud, but they just know the current government will not prosecute so it's 'legal'. If they do, eventually, get held accountable the fine will likely be less than the savings.
Important context to add is that those who benefit from such tax breaks turn around and fund with their disproportionate, ill-gotten gains the very candidates who you say we should really be upset with. They also fund the media companies, both social and traditional, that are the propaganda for the status quo. They don't benefit from these laws that create loopholes in a vacuum - they're the very reason the laws continue to have loopholes in the first place!
As they say, "No war except class war", I think we are perfectly justified in being upset with the names in the headlines.
A pattern I notice in well-educated, intellectual people seems like the habitual equivalent of blaming winners at a casino, and using that to give the casino more power.
The puppet on the left hand isn’t to blame, it’s the puppet on the right hand! No, it’s definitely the left. Let’s ask them…wait, they each blame each other.
Why do you think the IRS is structured the way it is? Zuck and his cohort regularly contribute to defang the IRS. Or did you miss the part where he donated to the president and then the IRS became significantly less capable of going after the largest tax avoiders?
> This is not about Zuck it's about the IRS and probable political interference.
This is not about Zuck, it's just about the probable political interference that Zuck funded.
Yes, that's what I mean. That said - Meta is likely knowingly breaking rules, which is unethical, they deserve blame as well, but the framing should be more holistic.
Its not clear, the IRS will presumably decide if, for example, Zuck gets an R&D tax deduction from his salary because he contributes to code, which no other large tech company has tried to claim.
Meta is the what makes this more interesting. It tells the story of a single company highlighting the overall problem. This is journalism 101. Anyone reading this is going to understand the issue isn't that Meta is breaking a law, but rather that the laws are setup in such a way that Meta can use them like this, and probably has undo influence to get it written this way.
Further, while they are doing this, it might not be what lawmakers intended.
Sorry, but this is all basic journalism going back decades.
Benefits of being able to pay a lot of smart people good salaries to lower your tax obligations.
This example just happens to use a handful of things that are in the current zeitgeist of concern (max eyeballs). Meta + Data Centers + AI + Billions + Tax = great ad dollars.
I have to imagine that NYT has an internal metric ad dollars / article. I'd be curious to see the top 10 money makers.
>Folks get mad at Musk, Zuckerberg, etc... if they're doing something illegal, ok yea that makes sense. If folks are mad about actions that are legal, it makes zero sense to be mad at the actor. Be mad at the people/entities who created the legal loopholes and laws.
Did you read the article? Meta themselves aren't confident that what they're doing is legal, and they're very clear about the fact that it might be clawed back by the IRS because they're abusing a tax credit intended to be used for experimental research by putting their massive data centre build out into that "experimental research" bucket.
If a company's accountants and lawyers are concerned enough to bury disclosures in their securities filings to cover themselves, but the company leadership is brazen enough to proceed anyway, I'd say that's plenty of justification for people to be mad at the executive leadership.
I hate to break this to you, but it’s the same people. Zuck pays lobbyists to pay off his politicians, who write in the loopholes Zuck wants. The US is considered a “flawed democracy” for a reason. The current tax system is designed plutocratically.
I will call out cronyism when I see it, regardless of whether bought politicians have decided it’s legal or not.
> If folks are mad about actions that are legal, it makes zero sense to be mad at the actor.
Why not? Society is filled with norms we expect others to follow, from letting pregnant women sit on public transport to open the door for people in wheelchairs, or what not.
Not sure why it's so different about how you pay taxes or what you do with your money? If you're rich and live better than others, it's usually a (good) norm that we expect these people to give away more of their wealth compared to people live paycheck to paycheck.
It also makes sense to get mad at people who break the societal norms about taxes, where the point is that we all fund our society together, and some people pay more, some people pay less, not based on who has the most lawyers to find loopholes, but based on who can actually afford to pay more.
This is a weird comment in relation to this article.
> yes TFA implies that Meta is breaking the law, I'm not talking about situations where entities break the law
Right, so what is the point of your comment? The article is noting that Meta is really, really pushing the limits, claiming capital investments are "R&D". It is most certainly outright tax evasion, though we all know the US is so hyper-corrupt and busted now that Zuck just needs to call Trump and tell him how great he is and nothing will be done about it. That's ignoring that the IRS was so hollowed out, purposefully, that everyone is going wild with tax evasion because they know it not only won't be caught in the first place, it would never be enforced.
The US is fully and completely into the kleptocracy stage, so some very strange rant about how companies can lawfully use deductions seems perverse.
> Under a tax credit created in the 1980s to spur innovation, companies can get a rebate for supplies, but only if they are being tested in an experimental effort, not standard business operations. Meta is claiming that the costly A.I. computer chips it buys from companies, including Nvidia, are entitled to a taxpayer-provided discount as part of the experiment. [...]
> The company started claiming the credit for the data centers two years ago. Since then, Meta’s savings from the credit have soared, trimming almost $4 billion off its tax bill last year, filings show.
Yeah... as a US citizen and taxpayer I think I'd like that $4 billion back.
It's crazy that some of these facts incentives for smaller businesses are abused by multinational conglomerates. I think the laws should set some sort of limits on who can take the tax breaks, like hello?! This isn't about not paying taxes through some weird schemes. This is literally abusing the system to the next level in my opinion
The article reads like a propaganda to have media to have general people to make fuss about Meta's tax practice regardelss it is legal or not.
"Trend in tax break" in the article does not mean jack shit so long as it's legal. There are myriad of factors why the trend happens. Meta stock went up, more revenue in, thus more tax break as they pay more, the higher the tax percentage etc.
This article is pointing out that the practice is almost certainly illegal. These data centers are being used for production workloads, not experiments.
>Meta said the research tax credit shaved $2 billion off its taxes in 2024, and then $3.9 billion in 2025.
Infuriating.
Was meta thinking about this like a hedge against them failing at AI? ie they thought "let's do tax fraud, and we'll probably get called out on it. but if our AI ambitions fail completely, we will have a better argument in court that this was an "experiment" when the government tries to take the money back (like what the article describes about the claw back of the 2013 tax break)"
Some training runs would qualify. I’m sure they are doing some qualifying research but that isn’t even what they claim to be using all these chips for. They are using them for production workloads and claiming that is experimental.
"Meta is claiming that the costly A.I. computer chips it buys from companies, including Nvidia, are entitled to a taxpayer-provided discount as part of the experiment."
Why do these schemes always involves these private companies siphoning money from taxpayers? It's "communism" (or whatever) to subsidize public health, yet we are expected to subsidize experimental AI companies.
We aren't expected to. We (or our elected representatives) passed a law saying that experimental spending gets tax breaks. And I don't really see an argument that LLMs aren't in an experimental phase.
I'm happy to make that argument. LLMs were experimental in 2023. It's 2026 now, and enormous numbers of people use them on a daily basis (ChatGPT has 1.2 billion weekly users now, according to Sam Altman at OpenAI DevDay).
They're only experimental in the way that computers are still experimental, since we continue to find new ways to use computers.
The actual solution here is to eliminate the corporate income tax and capture the money via higher capital gains and dividend income taxes.
All of this boils down to politicians knowing (even if they can't say it publicly) that the corporate taxes are badly structured and tax incentives are often revenue-positive (since in reality, every economist knows you should not be taxing business inputs, and in fact European VATs are structured around this idea), but being unable politically to do the sane thing and capture the income at a point it can't easily be gamed.
It often strikes me as quite the biased and one-sided take when a tax-paying entity is called out by the press for tax avoidance (NOT tax evasion, which is illegal). (yes TFA implies that Meta is breaking the law, I'm not talking about situations where entities break the law).
Previously we've seen "The Secret IRS Files" from Propublica as well as other coverage of tax avoidance that never resulted in tax evasion charges. Coverage wide enough that it's arguably safe to assume that no laws were broken because there was quite the demand for an enforcement response.
The funny thing is that a more accurate title for these pieces would be, "Federal Government Allows [tax-paying entity] a Massive Tax Break." And then the piece would be all about how the senate, congress, and president either explicitly wanted there to be this extreme tax loophole or was incompetent and allowed something they didn't mean to allow.
Folks are continually getting upset and riled up about players in the economic system instead of who and what makes the rules.
An analogous example: everyone got cranky about Martin Shkreli, mostly because he raised prices on Deraprim, although also because many would label him a brash jerk. But he went to jail for finance stuff, not raising prices. Why? Because raising prices in the way he did wasn't something the feds thought was illegal or wasn't something they thought he could be convicted of.
Folks get mad at Musk, Zuckerberg, etc... if they're doing something illegal, ok yea that makes sense. If folks are mad about actions that are legal, it makes zero sense to be mad at the actor. Be mad at the people/entities who created the legal loopholes and laws.
The problem is that law is a malleable mater and not all interpretation and use should be accepted, there is the spirit and the letter (don't know if it's an usual expression in english).
Dunno muchabout the US tax code but in the french tax code when there is a tax break there are practical conditions and an information intention / context by the legislative assembly in the law project. If french deputies create a tax break to incentivize research and you use it to get a tax break given investment in infrastructure not at all linked to any research, even if you match the practical conditions it's considered an abuse/diverting of the law and the french tax administration can completely cancel your tax break and you'll have to sue them in our administrative justice branch to change their decision.
That sounds like a nightmare for the business owner, and a huge boon for the legal industry (aka lawyers). Uncertainty/ambiguity in law is poisonous for someone trying to operate in the law, and that goes for everyone from big corp to individuals just trying to function in society.
These are called "General Anti-Avoidance" rules. The UK calls theirs a "General Anti-Abuse" rule but it's the same idea, probably better branding. The consequence of not having them is that huge corporations just don't pay your taxes because hey, what do you mean you wanted us to pay taxes, if you provide any means by which I can avoid that surely I must be intended to avoid it, right ?
It's not a "nightmare" unless your goal is to avoid paying taxes or the rule was very incompetently drafted. If you want to spend $5M figuring out how to avoid paying $5M in taxes and then moan that it was expensive, remember to factor in the price of the minuscule violins other tax payers will be needing.
Which is why people write articles like this... to draw attention to these ambiguities and how much of a boon they are for businesses with lots of resources to navigate and exploit them.
Law isn’t mathematics, it always requires interpretation. That’s why we have human judges instead of flowcharts and lookup tables.
In the EU it's typical to keep to the spirit of the law, not necessarily to the letter. It makes it less game-able. If the tax break is for research and you use it for research and not "well, technically it could be considered research if you squint hard enough", you'll be fine.
It is perfectly fine to be upset about certain lawful behaviors because lawful does not mean good. This does also not exclusively apply to companies, people can be law abiding assholes. And it works in the other direction, too, sometimes unlawful behavior is good behavior.
But GP comment is not about how you feel about it. It is about where you direct that anger. If you dislike what a powerful entity does, well, we the people are supposed to have a recourse in our representatives. Why precisely is it that we feel like we do not?
Would you agree that public/consumer sentiment towards corporate behavior can change that behavior?
I expect everyone to behave nicely even in the absence of laws. The reason that I am not killing people left and right is not because it is illegal to so but because it is immoral. The law is a last resort to disincentivize certain behaviors or hold you responsible after the fact, it is not what should exclusively guide anyone's behavior.
Partially because organizations like Facebook spend heavily to ensure they're not taxed fairly.
>> But GP comment is not about how you feel about it. It is about where you direct that anger.
Don't worry, my anger is limitless and I can direct it at both corporations and corporations at the same time.
Unlimited corporate spending in politics?
I waa with you, but no, this is where you lost me:
"If folks are mad about actions that are legal, it makes zero sense to be mad at the actor."
There are people with mindset "I will try to be an overall decent human being and maintain some awareness and empathy of others", and there are the "I will be as much of a selfish asshole as the legal system allows me to and wreak untold damage in the endless game of whack-a-mole".
I think in fact more of us should be gunning after the second kind :). To paraphrase you, It makes zero sense for me to be OK with fundamentally anti-social, anti-humanity humanoids.
I think you're both right, it depends a lot more on the specific situation. For example if Corporation A finds a loophole that allows them to dump toxic waste in the river, let's be pissed at both sides. If Corporation B reacts to incentives in the tax code to build an AI data center, you can be mad at data centers if you believe they poison the earth and waste resources, but you should also be mad at the government who created those incentives in the first place.
Why have you posted this comment on this article? This article is about something Meta is doing that the author considers illegal. Maybe IRS and courts will agree, maybe not, but either way your comment is simply irrelevant to the situation being reported here.
It's just fraud, but they just know the current government will not prosecute so it's 'legal'. If they do, eventually, get held accountable the fine will likely be less than the savings.
Important context to add is that those who benefit from such tax breaks turn around and fund with their disproportionate, ill-gotten gains the very candidates who you say we should really be upset with. They also fund the media companies, both social and traditional, that are the propaganda for the status quo. They don't benefit from these laws that create loopholes in a vacuum - they're the very reason the laws continue to have loopholes in the first place!
As they say, "No war except class war", I think we are perfectly justified in being upset with the names in the headlines.
A pattern I notice in well-educated, intellectual people seems like the habitual equivalent of blaming winners at a casino, and using that to give the casino more power.
The puppet on the left hand isn’t to blame, it’s the puppet on the right hand! No, it’s definitely the left. Let’s ask them…wait, they each blame each other.
Yes, we can expect companies to lower their tax bill.
This is not about Zuck it's about the IRS and probable political interference.
Why do you think the IRS is structured the way it is? Zuck and his cohort regularly contribute to defang the IRS. Or did you miss the part where he donated to the president and then the IRS became significantly less capable of going after the largest tax avoiders?
> This is not about Zuck it's about the IRS and probable political interference.
This is not about Zuck, it's just about the probable political interference that Zuck funded.
The framing is around Meta avoiding paying taxes not about IRS and political interference. Its written in a way to cast shame as an implied bad actor.
Yes, that's what I mean. That said - Meta is likely knowingly breaking rules, which is unethical, they deserve blame as well, but the framing should be more holistic.
They aren't breaking the rules which is the point.
No, they are probably breaking the rules - and the rules are not being enforced. That's the point.
If this were merely a company using a regular tax deduction there would not be much of a story.
The story is that these GPUs are not being used for research but Ops and therefore should be subject to taxation.
Its not clear, the IRS will presumably decide if, for example, Zuck gets an R&D tax deduction from his salary because he contributes to code, which no other large tech company has tried to claim.
Meta is the what makes this more interesting. It tells the story of a single company highlighting the overall problem. This is journalism 101. Anyone reading this is going to understand the issue isn't that Meta is breaking a law, but rather that the laws are setup in such a way that Meta can use them like this, and probably has undo influence to get it written this way.
Further, while they are doing this, it might not be what lawmakers intended.
Sorry, but this is all basic journalism going back decades.
Benefits of being able to pay a lot of smart people good salaries to lower your tax obligations.
This example just happens to use a handful of things that are in the current zeitgeist of concern (max eyeballs). Meta + Data Centers + AI + Billions + Tax = great ad dollars.
I have to imagine that NYT has an internal metric ad dollars / article. I'd be curious to see the top 10 money makers.
you underestimate, I can be very mad at everyone, only limiting factor is if they deserve it
Why limit yourself? Engage in rage, unfettered!!
What you’re describing is accepting a low trust society as an inevitability. Many of us don’t want to do that.
>Folks get mad at Musk, Zuckerberg, etc... if they're doing something illegal, ok yea that makes sense. If folks are mad about actions that are legal, it makes zero sense to be mad at the actor. Be mad at the people/entities who created the legal loopholes and laws.
...why not both?
Did you read the article? Meta themselves aren't confident that what they're doing is legal, and they're very clear about the fact that it might be clawed back by the IRS because they're abusing a tax credit intended to be used for experimental research by putting their massive data centre build out into that "experimental research" bucket.
If a company's accountants and lawyers are concerned enough to bury disclosures in their securities filings to cover themselves, but the company leadership is brazen enough to proceed anyway, I'd say that's plenty of justification for people to be mad at the executive leadership.
I hate to break this to you, but it’s the same people. Zuck pays lobbyists to pay off his politicians, who write in the loopholes Zuck wants. The US is considered a “flawed democracy” for a reason. The current tax system is designed plutocratically.
I will call out cronyism when I see it, regardless of whether bought politicians have decided it’s legal or not.
Let’s not be naive here.
> If folks are mad about actions that are legal, it makes zero sense to be mad at the actor.
Why not? Society is filled with norms we expect others to follow, from letting pregnant women sit on public transport to open the door for people in wheelchairs, or what not.
Not sure why it's so different about how you pay taxes or what you do with your money? If you're rich and live better than others, it's usually a (good) norm that we expect these people to give away more of their wealth compared to people live paycheck to paycheck.
It also makes sense to get mad at people who break the societal norms about taxes, where the point is that we all fund our society together, and some people pay more, some people pay less, not based on who has the most lawyers to find loopholes, but based on who can actually afford to pay more.
Remember that publicly traded companies have a fiduciary duty to their shareholders to minimize their tax burden and maximize profit.
No they don’t and the campaign to convince people that’s some sort of law of nature should be recognized as the propaganda it is.
> If folks are mad about actions that are legal, it makes zero sense to be mad at the actor.
Just low-trust society things.
The rules are this way because the billionaire class has ensured that the government made the rules this way.
It is valid to be frustrated _both_ with the billionaires for bribing the government into having these rules _and_ the government for doing it.
It is borderline insanity to admonish people for criticizing the powerful entities who are the reason the loopholes exist.
This is a weird comment in relation to this article.
> yes TFA implies that Meta is breaking the law, I'm not talking about situations where entities break the law
Right, so what is the point of your comment? The article is noting that Meta is really, really pushing the limits, claiming capital investments are "R&D". It is most certainly outright tax evasion, though we all know the US is so hyper-corrupt and busted now that Zuck just needs to call Trump and tell him how great he is and nothing will be done about it. That's ignoring that the IRS was so hollowed out, purposefully, that everyone is going wild with tax evasion because they know it not only won't be caught in the first place, it would never be enforced.
The US is fully and completely into the kleptocracy stage, so some very strange rant about how companies can lawfully use deductions seems perverse.
> Under a tax credit created in the 1980s to spur innovation, companies can get a rebate for supplies, but only if they are being tested in an experimental effort, not standard business operations. Meta is claiming that the costly A.I. computer chips it buys from companies, including Nvidia, are entitled to a taxpayer-provided discount as part of the experiment. [...]
> The company started claiming the credit for the data centers two years ago. Since then, Meta’s savings from the credit have soared, trimming almost $4 billion off its tax bill last year, filings show.
Yeah... as a US citizen and taxpayer I think I'd like that $4 billion back.
Don’t worry, you won’t be getting any of that money. It’ll be going in entirety to the utility monster (bottom quintile)
I don’t see the connection between the utility monster concept and poor people.
Also I’m confused, do you want a regressive tax system?
Those utility monsters contain about 9000 grams of protein apiece when fully grown! They're a bargain compared to your typical protein powder.
Do you prefer yours Red or Green?
> One of the biggest expenses of any A.I. data center was computer chips, which are made by companies like Nvidia and cost thousands of dollars each.
“Thousands.” Yes, in the same way that the earth is thousands of years old. 4.5 million thousands, but still, thousands.
The way I read that was that the chips cost thousands of dollars each, not the datacenter itself.
It's crazy that some of these facts incentives for smaller businesses are abused by multinational conglomerates. I think the laws should set some sort of limits on who can take the tax breaks, like hello?! This isn't about not paying taxes through some weird schemes. This is literally abusing the system to the next level in my opinion
The article reads like a propaganda to have media to have general people to make fuss about Meta's tax practice regardelss it is legal or not.
"Trend in tax break" in the article does not mean jack shit so long as it's legal. There are myriad of factors why the trend happens. Meta stock went up, more revenue in, thus more tax break as they pay more, the higher the tax percentage etc.
This article is pointing out that the practice is almost certainly illegal. These data centers are being used for production workloads, not experiments.
>Meta said the research tax credit shaved $2 billion off its taxes in 2024, and then $3.9 billion in 2025.
Infuriating.
Was meta thinking about this like a hedge against them failing at AI? ie they thought "let's do tax fraud, and we'll probably get called out on it. but if our AI ambitions fail completely, we will have a better argument in court that this was an "experiment" when the government tries to take the money back (like what the article describes about the claw back of the 2013 tax break)"
At some point AI was experimental for companies, clearly it's being used for business operations in 2025 and 2026.
Can we think of an example of computing hardware/software that would qualify for this tax credit?
Some training runs would qualify. I’m sure they are doing some qualifying research but that isn’t even what they claim to be using all these chips for. They are using them for production workloads and claiming that is experimental.
"Meta is claiming that the costly A.I. computer chips it buys from companies, including Nvidia, are entitled to a taxpayer-provided discount as part of the experiment."
Why do these schemes always involves these private companies siphoning money from taxpayers? It's "communism" (or whatever) to subsidize public health, yet we are expected to subsidize experimental AI companies.
We aren't expected to. We (or our elected representatives) passed a law saying that experimental spending gets tax breaks. And I don't really see an argument that LLMs aren't in an experimental phase.
I'm happy to make that argument. LLMs were experimental in 2023. It's 2026 now, and enormous numbers of people use them on a daily basis (ChatGPT has 1.2 billion weekly users now, according to Sam Altman at OpenAI DevDay).
They're only experimental in the way that computers are still experimental, since we continue to find new ways to use computers.
I think that's shaky but also that's OpenAI and not Meta. Up until whenever Muse was launched Meta didn't have anything I'd call a LLM product.
They've had AI-powered chat and search features in WhatsApp/Instagram/Facebook itself for a few years now.
2023-09: "Meta AI is a new assistant you can interact with like a person, available on WhatsApp, Messenger, Instagram" - https://about.fb.com/news/2023/09/introducing-ai-powered-ass...
2024-04: "You can use Meta AI in feed, chats, search and more across our apps" - https://about.fb.com/news/2024/04/meta-ai-assistant-built-wi...
2024-09: "You can now use your voice to talk to Meta AI on Messenger, Facebook, WhatsApp and Instagram DM, and it’ll respond back to you out loud" - https://about.fb.com/news/2024/09/metas-ai-product-news-conn...
You don't consider Llama an LLM?
There are experiments but the majority of chips now are going into production workloads and Meta isn’t even denying that.
That law is literally privatized profits, public losses.
Companies get a tax break on risks. If they pan out, they keep the profits and the tax break.
Neoliberalism is a scourge.
No one is siphoning money from taxpayers. Paying less tax legally is not taking any money from you.
The article is pointing out that it is not legal.
It is exactly that. We are subsiding them and will not be repaid for it.
Then who is paying for the data centers?
The actual solution here is to eliminate the corporate income tax and capture the money via higher capital gains and dividend income taxes.
All of this boils down to politicians knowing (even if they can't say it publicly) that the corporate taxes are badly structured and tax incentives are often revenue-positive (since in reality, every economist knows you should not be taxing business inputs, and in fact European VATs are structured around this idea), but being unable politically to do the sane thing and capture the income at a point it can't easily be gamed.
sans paywall: https://archive.ph/FvUmr
It's working as intended? Meta invests in innovative infrastructure, and the country benefits.
Look at Europe for the opposite, and the disastrous consequences there.
Meta is claiming tax credits for production infrastructure, not R&D.
Has Europe turned into a Galt-deprived cesspool of "takers" in the last few weeks? It seemed like a decent place last time I visited.