The problem with your example is that for many S&P companies it doesn’t work that way,
A better example:
Your company spent $800 last year, and earned $1,000, for a $200 profit. So tax the profit, right?
Except that you created an off-shore subsidiary in Barbados and transferred your intellectual property to it. That includes your company name. And the software you wrote in-house - even though none of your programmers ever set foot in Barbados.
You never made that $200 profit, because you had to pay $200 to your off-shore subsidiary for the use of your company name and software. And so you don’t pay taxes on it. You wholly own the subsidiary, but it’s in a tax haven so you’re not taxed on it.
Now when you want that 3D printer you borrow money from the subsidiary. And you claim the interest (which really, you’re paying to yourself) on your taxes. Once or twice a year you visit your mail-drop in Barbados to keep it legal, and the subsidiary pays for the “business trip” and a luxury hotel.
Meanwhile your smaller competitors are paying full taxes to do the same business. Assuming you don’t drive them under with your competitive (tax) advantage.
