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Spanish authorities raid Google offices over tax

reuters.com

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Re: Spanish authorities raid Google offices over tax

#351

Post by ionised »

newjersey wrote: post #338
edc117 wrote: post #333

Earlier quoted context omitted.

The truly frustrating part to the average taxpayer is the one-sidedness of how the law develops. I have politicians telling me that TTP is vital and needs to pass, so we get strong protections for IP, more revenue for these american companies, blah blah. But when it comes to making laws to tax those same companies, well there's lots of issues, it's very complex, we need to study it for a long while. It's very clear w…

> The truly frustrating part to the average taxpayer is the one-sidedness of how the law develops. I have politicians telling me that TTP is vital and needs to pass, so we get strong protections for IP, more revenue for these american companies, blah blah. But when it comes to making laws to tax those same companies, well there's lots of issues, it's very complex, we need to study it for a long while. Just to clarify…

They'e both terrible attempts to enrich the already entrenched even further.

Re: Spanish authorities raid Google offices over tax

#352

Post by ionised »

wyager wrote: post #114
melenaboija wrote: post #111

I don't think there is a justification for big corporations to do what they do and they have to be pursued. I've been working for a bank in a tax haven in Europe and I've seen that financial engineering powerful people use has been a known and accepted tool for the governments for a while, and now that Europe is living a financial crisis governments start asking. These companies play in an absolutely different league…

Why are you blaming the companies for acting rationally, rather than the governments for creating absurd tax environments? I agree it's unfair, but I can't fault anyone for trying to legally minimize their tax burden. Tax law should just be simple enough that anyone can do it themselves.

Those same companies lobby governments to create those absurd and favourable tax arrangements. They are all to blame.

Re: Spanish authorities raid Google offices over tax

#353

Post by AnthonyMouse »

uola wrote: post #250
AnthonyMouse wrote: post #128

Earlier quoted context omitted.

> Companies like Google not having to pay tax on revenues outside the US is essentially a government subsidy. One that creates a "slush fund" for US companies to acquire their European competition. We're essentially in a trade war, just that Europe hasn't realized it. Except that "US companies" incorporated in Ireland aren't US companies. Can't European companies also incorporate in Ireland?

No, because Google isn't paying the Irish corporate tax but instead moving the money to a second Irish company (hence the double Irish) based in the Bahamas. A European company with a subsidiary based in the Bahamas would trigger anti-avoidance laws, which a US company won't (until they bring the money back into the US) because of a loophole in the US anti-avoidance laws.

I think you misunderstand. The whole premise here is that none of the principals care where you're incorporated.

A company whose primary employees are in Europe and whose primary customers are in Europe can still be incorporated in Delaware and traded on the NYSE. These tax avoidance mechanisms aren't for "US companies," they only work if you're in practice an international company. A "European company" which is also in practice an international company could do the same by becoming nominally a "US company" without changing anything of consequence about their operations. Because international companies don't really care where they're incorporated.

The trade war isn't between US companies and European companies, it's between companies big enough to be "international" and everybody else.

Re: Spanish authorities raid Google offices over tax

#354

Post by tvanantwerp »

peter303 wrote: post #184

Panama Papers showed a significant fraction of EU officials stash money in low tax havens. Icelands PM resigned as a result. The Panama Papers was a leak of terabytes of documents from a legal office who sets up these corporations and accounts. Ironically the USA is a top tax haven due to anonymous shell corporations you can create in several states. Lots being stashed here due to anomymity and economic safety.

The US is a pretty poor corporate tax haven. Our corporate rates are higher than pretty much everybody in the EU (including soon-to-be-out-of-the-EU Britain). It's one of the major contributing factors to corporate inversions (the moving of corporate headquarters out of the US) and companies like Apple not bringing overseas profits back to the US.

Re: Spanish authorities raid Google offices over tax

#355

Post by paulddraper »

gozur88 wrote: post #298
nickik wrote: post #247

Earlier quoted context omitted.

That is why many people have often called for tax simplification. The Flat Tax proposal (and for you progressives, yes we can make it progressive but that not the point) is designed to be as simple as possible and to provide few loopholes. This is not the end all solution but it at least makes everything far, far simpler.

Flat taxes address the wrong problem. It's easy enough for individuals and corporations to look up their tax in a table once gross income (or profit) is determined. The complication is determining what counts as income, and flat tax schemes don't do anything to address that complication, particularly for corporations. Most corporate tax avoidance strategies take advantage of laws intended to prevent different countri…

There's also Fair Tax, which is not income, but rather sales, which are typically simpler.

Re: Spanish authorities raid Google offices over tax

#356

Post by smokeyj »

HappyDreamer wrote: post #342
smokeyj wrote: post #286

Earlier quoted context omitted.

So lobbying is the equivalent of murder.. but the party accepting the bribe.. that was entrusted to protect you from murderers.. should not go to prison? Frankly, in this picture you've painted, I'm not sure what the point of this bribe accepting party is. This is like having a body guard that might shoot you if there's a higher bidder. The whole point of the body guard is to protect you from killers, but now he's sh…

Should [a lawmaker accepting a bribe / lobbying-money to remove restrictions meant to prevent people from dying] go to prison? In some cases, yes I would probably want that to happen. Imagine a company and a few lawmakers that via bribes/lobbying remove regulations around asbestos (which is very carcinogenic) and start building houses with asbestos (because asbestos is inexpensive). Now people are going to die in can…

You're describing a bodyguard that might kill you if there's a higher bidder. And your solution is to give the bodyguard more power.

Dude. I just want you to consider that your relationship with said bodyguard is abusive and preventing you from thinking straight. And said bodyguard will never care about you more than the money his higher up friends will provide. I know this bodyguard told you a lot of lies, about always being there for you. About protecting and serving. Sorry dude, it's lip service. The bodyguard works for the highest bidder and the highest bidder isn't you or me.

The solution?? Higher a real god damn bodyguard! One with a collateralized contract and reliable arbitrator of your mutual choosing. Turns out social contracts aren't worth the imaginary paper they're written on.

Re: Spanish authorities raid Google offices over tax

#357

Post by AnthonyMouse »

alkonaut wrote: post #185
AnthonyMouse wrote: post #102

Earlier quoted context omitted.

> The only solution to this problem if you do have corporate income tax is to establish how much profits Uber actually made in each country , and have the profits taxed correspondingly. The problem is that's not how profit works. There is no "in each country" to calculate. They paid $15B to employees in 20 countries and then made $20B in revenue from 20 countries. There is then $5B of international profit, but how mu…

Thats my point - now it's arbitrary and decided by the company who can setup whatever scheme necessary to transfer profits to where they are least taxed. Making it arbitrary for some companies how much taxes to pay in a country obviously isn't a good thing. Maybe what it all comes down to is that it makes more sense to tax transactions and charge corporations for services (e.g use of roads) that are tax funded. To av…

Charging for infrastructure is a bad idea. You pay the cost of building the infrastructure whether you use it or not and the cost of the marginal car or the marginal data packet is near-zero.

The whole problem with taxes is that you want tax revenue but you don't actually want to tax anything because taxing things causes people to avoid doing them. That's why everybody wants corporate income tax -- who cares if we discourage "corporate profits"? The problem is what you really end up doing is discouraging corporate profits in your country, so the profits end up somewhere else instead.

The best possible tax seems to be to impose VAT on everything, so that the rate stays low because there is a broad tax base and you're not discouraging anything in particular very much.

Fees for infrastructure are the opposite of that. A 20% VAT makes the thing 20% more expensive, which isn't that bad. An infrastructure fee for what would otherwise have been zero cost makes the thing infinity percent more expensive. It's basically the worst case scenario.

So for example a high tax on network usage is basically going to kill YouTube (and every other streaming video service) because the amount of bandwidth it uses for the amount of revenue it generates would no longer be worth it. Then your total network usage has been cut by 80% which means you need to quintuple the fee to make the amount of revenue you were expecting and it quickly snowballs from there.

Re: Spanish authorities raid Google offices over tax

#358

Post by kafkaesq »

ptaipale wrote: post #346
kafkaesq wrote: post #292

Earlier quoted context omitted.

If you don't like what the newspapers are saying -- or are suspecting them of severely distorting and/or outright fabricating the reasons behind the raid conducted earlier today -- I'm sure the Hacienda will be putting out their own press releases soon, if they haven't already.

Why would they? If it is not in their interests ("their interests" as in "in the PR interests of politicians who control what the agency does") and there is no legal requirement to do so?

Either way, I'm not sure what the point is in trying to shift focus to the newspapers or the politicians.

Re: Spanish authorities raid Google offices over tax

#359

Post by kuschku »

CydeWeys wrote: post #336
kuschku wrote: post #149

Earlier quoted context omitted.

Yes, just like GM, BMW, Mitsubishi, Hyundai, Ford, Fiat do. All of which bought and used the exact same defeat device. So why is only VW being punished, and why almost 1.5 years after the EPA learnt about it?

Do you have a source? Those are extraordinary claims. I'm not aware of any other cheating anywhere close to the magnitude of what VW did. Also, what "defeat device" are you talking about? VW's cheat was in software; it wasn't some specific device. And are you seriously surprised that it can take 1.5 years for a massive multi-billion dollar lawsuit to wind its way through federal courts? If you think 1.5 years is long…

The "defeat device" was a specific piece of software that Bosch provided with the chips they sold.

Also, it was 1.5 years from discovery to investigations being started.

And regarding the claims: They’re not extraordinary. 4 companies have been in the original report that incriminated VW, others incriminated themselves [1], etc.

Germany is deciding to ban GM cars in Germany because they used the same defeat "device" VW used but refuse to fix things, etc.

http://money.cnn.com/2016/04/26/news/companies/mitsubishi-ch...

http://www.autobild.de/artikel/dieselabgas-manipulationsvorw...

It’s everywhere on the news here that all manufacturers did it. I’m surprised you haven’t heard of it yet.

Re: Spanish authorities raid Google offices over tax

#360

Post by ptaipale »

kafkaesq wrote: post #358
ptaipale wrote: post #346

Earlier quoted context omitted.

Why would they? If it is not in their interests ("their interests" as in "in the PR interests of politicians who control what the agency does") and there is no legal requirement to do so?

Either way, I'm not sure what the point is in trying to shift focus to the newspapers or the politicians.

Well, the whole point of the exercise is that politicians want to have something in newspapers.
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