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EU lost up to €5.4B in tax revenues from Google, Facebook: report

reuters.com

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Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#71

Post by anonymousDan »

lucideer wrote: post #50
DannyBee wrote: post #31

"This resulted in estimated revenue losses for EU states, other than Ireland, of between 51 and 54 billion euros between 2013 and 2015, the report concluded." So if i understand this right, this is basically: the EU didn't really lose anything, since ireland is in the EU, but the other states would have gotten more in total if they weren't allowed to do this? My other understanding is that the tax laws of all the EU…

> My other understanding is that the tax laws of all the EU countries are not controlled by the EU, but by the individual countries? This is partially but not 100% correct. Tax laws are controlled or "administered" by individual countries but overseen by EU directives. This means that while individual countries apply the law, their application must comply with EU guidelines. The Irish government has been found guilty…

For what it's worth, that ruling is strongly disputed by the Irish Government and is under appeal.

Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#72

Post by latch »

dangsmum wrote: post #41
latch wrote: post #13

Earlier quoted context omitted.

I get what you're saying, but I think it's fundamentally wrong for two reasons. First, it is "big" when you consider how that money could be used. Cynicism aside about funding wars and filling walls with cash, it could be used for substantive (read: big) social good Secondly, this is an important market. If they don't want to pay taxes, they have the legal option to not do business in Europe. So while you say "5B is…

"they have a legal option not todo do business in europe" Do you see any way to do that other than to prevent eu businesses buying ads from google? Because i think that might have a few severe unintented consequences for businesses in the eu, and have exactly zero impact on google.

Not sure I understand. You're saying EU business' not allowed to buy ads on Google would have "exactly zero impact on google" ??

Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#73

Post by confounded »

marcell wrote: post #14

Strategically, I wonder Google/FB/etc. would do better to pay more taxes. The recent GDPR is a total disaster for them. Maybe it could have been avoided if they paid more taxes, and were on friendlier terms with the EU.

I'm afraid they would rather minimize their tax bill and maximize their lobbying bill.

Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#74

Post by peteretep »

Supernaut wrote: post #63
gaius wrote: post #55

Earlier quoted context omitted.

Ireland is only able to charge such low corporation tax due to the generous subsidies it receives from the EU too.

Can we see some evidence for that claim? According to my research, Ireland is a net contributor to the EU budget. In 2014, the last year for which complete data is available, the country paid €168m more to the EU than it received in grants and payments.

Your comment is either unlucky or massively disingenuous in choosing 2014, as:

"Ireland has [in 2014] become a small net contributor to the EU Budget for the first time since it joined the bloc in 1973"

http://www.independent.ie/business/irish/ireland-contributes...

Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#75

Post by themihai »

anonymousDan wrote: post #65
seanieb wrote: post #28

"This resulted in estimated revenue losses for EU states, other than Ireland" What does this mean? Ireland is in the EU. It's like complaining France or Germany don't share their tax revenue proportionally with the rest of the EU states. Ireland and other EU states have sovereignty over their own tax laws. If you change that you will basically change what the EU is.

What I want to understand is what happens in the opposite direction, i.e. what does the tax situation look like for e.g Volkswagen cars sold in the US? Do they pay a minimal amount of tax in the US with most of the profits repatriated to Germany? If so it's just a whiney tax grab by the French and Germans who are used to getting their own way in the EU.

Well I don't see any issue repatriating taxed profits. After all they go to a different market to make a profit, right? The issue is when they don't pay their fair share of tax by using various tax evasion schemes more or less "legal".

Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#76

Post by peteretep »

themihai wrote: post #60
Iv wrote: post #38

Earlier quoted context omitted.

There is a movement calling for tax harmonization in EU. I think this is a "what-if" scenario. "What if there were no internal competition between EU state to make a race to the bottom in terms of tax on profits?"

Well the issue is not the competition on tax, it's tax avoidance/evasion. You can't compete on tax with fiscal paradises that provide no infrastructure to operate a business. Most of the corporations within EU simply create shell companies in Luxembourg and artificially siphon off their profits so that they can pay 1% tax there instead of aprox 20% within EU. Luxembourg doesn't contribute with anything(i.e. infrastru…

    > You can't compete on tax with
    > fiscal paradises that provide
    > no infrastructure to operate a
    > business
eg the Isle of Man, where you can get an EU VAT number and pay 0% corporate tax.

Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#79

Post by alkonaut »

elgenie wrote: post #67

Taxing multinational corps is pretty difficult. Let's say a parent company UsTech, which makes money from ads on a ubiquitous digital platform, has an Irish subsidiary UsTechDublin,LLC and a German subsidiary UsTechBerlin,GMBH. UsTechBerlin hosts a bunch of very well paid engineers who work on app performance and backend infrastructure efficiency; UsTechDublin hosts a bunch of low paid customer service reps that prov…

What you are describing is exactly the issue with the current system, correct? That is, taxation based on physical presence only, and the arbitrary ways corporationsn can do intra-subsidiary transfers.

A tax for megacorps based on revenue seems a lot simpler.

Re: EU lost up to €5.4B in tax revenues from Google, Facebook: report

#80

Post by Thiez »

whb07 wrote: post #58

I wonder what would happen if G/F just upped and "left" the EU? Ensuring to close every physical location as they did so. I wonder how much of a bind the politicians would be trying to remain in power as they would be in the position of trying to add Google and Facebook to the ban list or just continuing like normal except with less tax revenue. Does anyone here really believe that any EU bureaucrat would ban Faceboo…

Do you honestly think that without US companies, there will be no search engines and social networks? Here in the Netherlands we had Hyves[1] before we had Facebook, which was pretty big. If, for whatever reason, Facebook were to vanish tomorrow from the EU tomorrow, I have little doubt that we'd all be on a different social network by Christmas. Of course there would be a lot of complaining during the first two weeks. I would miss Google more than I would Facebook, but perhaps an influx of 500 million new users would give competing search engines the income to improve their results to equal those of Google (perhaps they're already of comparable quality and I just haven't noticed).

Google and Facebook are making a lot of money in the EU, and leaving the EU because they have to pay more taxes would be like cutting off the nose to spite the face. It just wouldn't make financial sense, and shareholders would (understandably) be furious.

[1]: https://en.wikipedia.org/wiki/Hyves

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