Ivey Publishing
Etsy: Keeping it Real By Keeping Taxes Low
De Simone, Lisa;Hoopes, Jeff;Lester, Rebecca;Melvin, Sheila
Product Number:
A227
Publication Date:
03/02/2016
Length:
8 pages
Product Type:
Case
Source:
Stanford University
Etsy was an online craft bazaar founded in 2005 in a loft in Brooklyn, New York. The company was known for its emphasis on social responsibility, transparency, authenticity, and its somewhat nontraditional approach to business. In January 2015, Etsy converted its Irish subsidiary to an unlimited liability company, a move it described as implementation of an updated global corporate structure. In a subsequent U.S. Securities and Exchange Commission (SEC) filing, it stated that this changed structure might result in a reduction in our overall effective tax rate. In August 2015, the company came under fire for this move. Bloomberg ran an article headlined Etsy Taps Secret Irish Tax Haven and Brags About Transparency at Home. Americans for Tax Fairness charged that Etsy had changed its behavior and [was] now using unethical business practices. John Montgomery of Startworks declared, Etsy sold its soul for a lower corporate tax rate. The Wall Street Journal summarized the reaction with the headline Etsy Faces Pressure to Abandon Irish Tax Strategy. This case explores Etsy's initial decision, the critical public response to it, and Etsy' choice to ignore the fallout and stay the course.
Issues:
Disciplines:
Accounting
Price:
$5.80 CAD / $4.45 USD Printed Copy
$5.25 CAD / $4.25 USD Permissions
$5.25 CAD / $4.25 USD Digital Download

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