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Amazon and Starbucks pay less tax than sausage stall, says Austria

bbc.co.uk

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Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#41

Post by throwaway1974 »

shkkmo wrote: post #36
pipio21 wrote: post #28

Earlier quoted context omitted.

This is not a solution, and it is not clever but stupid. If someone in power is so stupid to do it, companies will stop operating on their country but the world will continue going around and tax heavens will continue existing. Governments are bankrupt totally now, expending way more that what they earn, with 5% deficits or more and want to raise more and more money in taxes, but there is a limit on what they could e…

Why would any business stop operating in a country when they can simply raise prices to cover the tax? Everyone else will have to raise prices as well so nobody would be at a competitive disadvantage.

Competition

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#42

Post by skafjvhs »

exDM69 wrote: post #40
skafjvhs wrote: post #27

Something about this story seems off to me. >Mr Kern, who heads Austria's Social Democrats and the country's coalition government, also said Facebook and Google had sales of more than 100m euros each in Austria. I'm not an expert on Austria but this suggests to me that this person can propose and possibly pass laws in Austria. He is not just an activist who only has the power to give interviews to BBC. If he thinks t…

> If he thinks that Amazon and Starbucks are not paying enough tax to Austria, why doesn't he change Austrian law to charge them more tax? Because Austria is a member of the EU and businesses in the EU but outside of Austria can operate there while paying taxes from their profits to their "home" country (VAT must be paid in Austria). Now this is all good if the system wasn't so easy to exploit. Typical arrangements (…

So the EU will not allow Austria to pass, for example, a tax on internet advertising in Austria (in the article the Chancellor complains that Facebook and Google don't pay advertising duty in Austria)?

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#43

Post by ersii »

throwaway13337 wrote: post #8
jkot wrote: post #2

Does amazon even have a presence in austria? I thought it is handled from other countries.

Living in Austria right now, I know two Austrians out of the like five I know well that have amazon prime. I only know about it from those people because they order so much on amazon. They may be using amazon.de, but so are most central euro countries. In Denmark, people generally either buy from .de or .co.uk. Certainly people order less from amazon than in the states, but the presence is still pretty huge.

I think the Original Poster that you're responding to mean presence literally, as the word is usually used. As in "Does Amazon have any facilities/staff etc in Austria?".

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#44

Post by [deleted] »

mschwaig wrote: post #4
hga wrote: post #3

Part of this makes an intuitive sense, a sausage stall has one trivially accessible "throat to choke", whereas Austria's access to e.g. Jeff Bezos is much more difficult. Starbucks, though, I'm assuming they've got retail shops in Austria? That just means they can afford better tax lawyers.

Being able to pay tax lawyers that are so great that you basically don't have to pay taxes kind of breaks the concept of taxation though.

[deleted]

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#45

Post by oh_sigh »

mschwaig wrote: post #4
hga wrote: post #3

Part of this makes an intuitive sense, a sausage stall has one trivially accessible "throat to choke", whereas Austria's access to e.g. Jeff Bezos is much more difficult. Starbucks, though, I'm assuming they've got retail shops in Austria? That just means they can afford better tax lawyers.

Being able to pay tax lawyers that are so great that you basically don't have to pay taxes kind of breaks the concept of taxation though.

Whose fault is that?

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#46

Post by hga »

mrweasel wrote: post #35
PieterH wrote: post #31

Earlier quoted context omitted.

This is what a sales tax, like VAT, is.

VAT isn't a sales tax. But yes, it's moving the entire taxation of companies to the sales tax level. The US already have sales taxes, at least in some places. The US generally, as is my understanding, doesn't have a VAT. VAT is a consumption tax, sales taxes are taxing the sellers purchase. The differers is very subtle.

The US has sales taxes in most places, and there's a bewildering number of them, e.g. in my home town that I've retired to, I could be paying the state sales tax, I'm sure some states allow counties to do it, the city sales tax (and my city spans two counties), and a special tax for the shopping area, each of decreasing size.

There's also exemptions or lower rates for things like food, and even sales tax "holidays" when certain classes of items are free of sales tax for a few days. All of this complexity is one reason Internet companies don't want to collect it.

If we have a VAT, no one's told me about it (a general one, anyway)! The concept does get mooted every once in a while.

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#47

Post by hga »

pipio21 wrote: post #28
mrweasel wrote: post #26

Earlier quoted context omitted.

One solution I've heard proposed is taxing revenue. If a business, like Apple, Starbucks or Amazon sells something in a country, they pay a percentage of the revenue, not the profit. It would be a very drastic change, and may items would need to have their prices adjusted, as low profit items could be a problem. The clever bit is that tax heavens are not longer possible, because it's not important where you move your…

This is not a solution, and it is not clever but stupid. If someone in power is so stupid to do it, companies will stop operating on their country but the world will continue going around and tax heavens will continue existing. Governments are bankrupt totally now, expending way more that what they earn, with 5% deficits or more and want to raise more and more money in taxes, but there is a limit on what they could e…

If someone in power is so stupid to do it, companies will stop operating on their country

It depends, for we have a state level test of this, Washington State and Boeing, which has a very boom and bust pattern of profitability. Of course, political muscle was used on them when they last tried to expand outside of the state, but I'm sure that initially, when the gross receipts tax was imposed, it just cost too much for them to move their factories elsewhere.

Of course, this tax does nothing good for other companies that it hits (there's a lower threshold as I recall, otherwise few would ever start up a company in the state), that aren't so profitable.

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#48

Post by seanmcdirmid »

tedmiston wrote: post #23
kijeda wrote: post #9

Earlier quoted context omitted.

Maybe it has changed recently, but an interesting factor is the Austrian Starbucks have been run by an Austrian master franchisor, not by the company.

This is interesting because Starbucks doesnt franchise in the US [0]. They do have one alternative that's what you see in most airports and in coffee shops with the sign "proudly serving Starbucks coffee", for example Barnes & Noble cafes are this style. These third party stores, for instance, cannot accept payment from the Starbucks mobile app and offer only a subset of drinks. I'm not sure what the term for this is…

B&N serve full Starbucks menus in most of the states, not just Starbucks coffees, but everything else...they are effectively franchised Starbucks. Marriott franchises a lot of Starbucks in airports but also some hotels. In other China, Starbucks in tier one cities are mostly JV-owned, while in tier 2 cities they were able to convince the CCP to let them do fully owned stores.

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#49

Post by yardie »

edko wrote: post #39
j_m_b wrote: post #13

Why do we even tax corporations instead of just the income that its owners receive from the corporation?

That is what Estonia does. Corporate income tax is 0%. They tax companies, on a flat rate, on the dividends paid out. This encourages reinvestment and growth.

And that is how it should be. But the US and EU tax codes are such a bodge. F500 CEOs are taking $1 salaries because why pay 55% on a $20mm salary when you can pay 15% on preferred stock dividends.

Re: Amazon and Starbucks pay less tax than sausage stall, says Austria

#50

Post by oh_sigh »

axlee wrote: post #32
j_m_b wrote: post #13

Why do we even tax corporations instead of just the income that its owners receive from the corporation?

Because corporations thrive purely on the society they are making money from. No company lives in a vacuum. However great and driven Elon Musk might be, he would never have made a single cent if he had started Paypal in Somalia. And what differentiates a market in Somalia from another market like, let's say, France? Let's take this further. Zuckerberg makes a lot of money in France solely thanks to the technological…

Is your argument that owners would just not take any money out of the company so as to not pay the taxes? In OPs example the company would still be taxed but just at different times
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