How does tax evasion work?
In: Economics
You probably mean company tax evasion, right?
Big international companies use something called [Base Erosion and Profit Shifting (BEPS)](https://en.wikipedia.org/wiki/Base_erosion_and_profit_shifting), where they transfer capital to tax havens (Profit Shifting) to make the amount of money they have to pay taxes on in the country where their headquarters are located (Base Erosion).
They can’t transfer money directly though, that would be too obvious. Instead, they transfer intellectual property like code, patents and licenses to a daughter company in a tax haven. Transfering intellectual property is free of all taxes and the main branch of the company now has to pay royalties on this intellectual property, thus shifting the money to the tax haven.
Apple has most of it’s money sitting in Ireland for tax reasons, even though it’s officially based in Cupertino, CA and the profits should be collected and taxed there.
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