Wednesday, April 10, 2013

Silicon Valley Foodies Vs. The Revenooer

Google's famous "triumverate" of geniuses--Eric Schmidt, Larry Page, and Sergey Brin--in front of Google's HQ in Mountain View, California, in Google's new self-driving vehicle.

The amazing company Google may end up having more in common with the cartoon characters Barney Google and his pal Snuffy Smith than they ever imagined. In the cartoon world of Barney and Snuffy, residents of a hillbilly village spend much of their time hiding their local stills from the tax men, known as "revenooers" in the parlance.

Now it seems, companies like Google, Facebook and others in Silicon Valley who dare to serve free gourmet meals to their employees, may end up fighting the IRS over this untaxed food benefit.

I may have been the last person in the Santa Clara Valley to have heard about these free meals. Not having worked in the industry, I didn't know until I wrote California Apricots: the Lost Orchards of Silicon Valley, that Google has food buyers who scour the region for the freshest local produce which they prepare and serve to their workers, at no cost. One of my sources, Andy Mariani of Andy's Orchard in Morgan Hill, sells Google his best apricots every summer.  "Wow," I said to Andy. "That's amazing."

Throughout history, until the present century at least, people have enjoyed eating together. Humans often bond when they break bread together. Some even gain strength from this and share an idea or two. (Now we know why those English people used to have an Empire when they all gathered every day at tea time.)

Taken a step further by Google and other companies, the theory is that if workers take time to consume healthy, delicious meals and dine with their colleagues in a pleasant environment, sometimes great ideas are born. The ideas benefit the company. In addition, healthy, happy employees  also benefit the company. Astounding concepts!

Google's gourmet kitchen in Mountain View, California.

Enter the revenooer.

The word now, according to reporter Patrick May at the San Jose Mercury News, is that the IRS is examining "whether free food and the other free perks provided by Silicon Valley tech companies qualify as a fringe benefit on which employees should pay additonal tax."

I've thought about this and I think employees should probably be taxed by the calories they consume per day in food provided by the company. Each employee would be required to keep a notebook which he would turn over at the end of each year to a Certified Public Accountant. Apricots, at just sixteen calories each would face a lower consumption tax than, say grass fed sirloin (36 calories per ounce).

Then, if a worker rode a free company bicycle on any day he consumed free company food and used up some of his free calories as he rode from one Google or Facebook building to another (approximately 200 calories per hour) he could add the depreciated value of the bicycle to his benefits, divided by its total yearly value to employees, subdivided by the minutes during which he used it (not including parking, locking and unlocking), subtract the number of calories he used on the bicycle from the value of the bicycle ride and the total calories consumed that day and come up with his taxable benefit. Some employees could actually leave campus with a deficit, especially if they rode an older bicycle. Each day that happened those workers could apply for a federal subsidy.

Mini snack bar at Google offices in Mountain View, California.

With 73,608 pages in the U.S. tax code, this makes a lot of sense. Especially to the IRS.  Agents can, of course, discuss the whole thing over a meal in Georgetown, which, since it would be a business expense could be charged to the taxpayers, a fully tax deductible expense. 

Let me tell you how it will be
There's one for you, nineteen for me
'Cause I'm the taxman, yeah I'm the taxman

Should five percent appear to small
Be thankful I don't take it all
'Cause I'm the taxman, yeah I'm the taxman

If you drive a car I'll tax the street
If you try to sit I'll tax your seat
If you get too cold I'll tax the heat
If you take a walk I'll tax your feet.

Now my advice for those who die
Declare the pennies on your eyes
'Cause I'm the tax man, yeah I'm the taxman,
And you're working for no one but me.

(1966 © by George Harrison, with John Lennon when Harrison discovered his earnings were subject to a supertax of 95% imposed by Harold Wilson's Labor government.)

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