Spain planning on going ahead with ‘Google tax’ despite US tariff threats • Hacker News Board

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#141

Post by tim333 » Thu, Dec 05, 2019, 3:08 PM UTC

sbacic wrote: post #120

I have been seeing these headlines more and more lately and I have a nagging suspicion that somebody is pushing an agenda. What exactly that agenda is remains to be seen. As for the news article you mentioned, it should be noted that the £28m is corporate tax, not _all_ the taxes. I'm reasonably sure that FAANG is not shirking the government on VAT or payroll taxes. As for why they pay so little corporate tax, I'd gu…

There are currently a lot of ways for multinational companies to reduce their tax burden to near zero by for example Microsoft allocating most of their European profits to a DVD stamping plant in Ireland which had a near zero rate at the time. Also they are kind of expected to maximise shareholder value by taking advantage of such legal avoidance schemes.

The proper way to stop this is for counties to make anti avoidance laws.

I recall a fuss in the press over Google along the lines of

"Using dubious tactics dubbed the 'Double Irish' and the 'Dutch Sandwich', Google apparently was able to pay only 3.2 per cent in tax on its overseas profits in 2011 even though most of its sales were in countries with tax rates from 26 to 34 per cent,"

and Google's CEO said

"We pay lots of taxes; we pay them in the legally prescribed ways,” he told Bloomberg. “I am very proud of the structure that we set up. We did it based on the incentives that the governments offered us to operate."

And basically if the governments want more tax they have to pass appropriate tax laws:

"If the British system changes the tax laws, then we will comply. If the taxes go up, we will pay more, if they go down, we will pay less. That is a political decision for the democracy that is the United Kingdom."

Which is kind of what Spain is trying to do.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#142

Post by sbacic » Thu, Dec 05, 2019, 3:10 PM UTC

melenaboija wrote: post #51

vector_rotcev wrote: post #32

As a non-economist (amateur or professional), I get the impression that countries are losing their concern of the repercussions of displeasing the USA economically. Is this an accurate interpretation? If so, is it that they're less fearful of reprisals (tariffs?) or that they're less confident in the benefits of cooperation with the USA? Or a mix? Or something else?

I agree with you but, what about the USA not being aware of building a strong western economy? Economic politics from USA the last years has been quite protectionist and it seems in the coming future it will have to fight against countries with literally billions of people, so my feeling is western countries better stay together. Is not about fear but working class being tired, among other things, of big corporations…

> Is not about fear but working class being tired, among other things, of big corporations avoiding taxes and they having to maintain the social structure.

I should point out that this isn't a universal problem in Europe. For many countries in Europe, a bloated, inefficient and sometimes corrupt government is the reason why tax rates have to be so high and not multinationals avoiding taxes.

Sure, taxing those multinationals _might_ make it easier on the working class, but it's just as likely that the government would find other ways to spend that money.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#143

Post by Mirioron » Thu, Dec 05, 2019, 3:10 PM UTC

scottlocklin wrote: post #124

sailfast wrote: post #84

Earlier quoted context omitted.

I admit that some of what you say regarding wars and consideration of rights outside of US Soil are in decay of late, but please also inspect the extent to which the United States continues to protect the freedom and liberty of which you speak, generally, and some of the history involved in the current state of things. Our current president is not the United States, despite his tendency to speak as if he is. I would…

>While that might undermine the argument about America being a protector of liberties, I think it would be a mistake to believe that there is no belief held at all, or that America does not continue to fight for these beliefs. What are these "liberties" and "beliefs" of which you speak? I'm an American and think the place is run by lunatics and mafiosos and has been for my entire life. It's more obvious now, and the…

>NATO was there to keep the Russians out and the Germans down. I don't support this organization at all in current year; it is simply a tool of US imperialism

Without NATO, the Baltics would probably already be a part of Russia again.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#144

Post by mrtksn » Thu, Dec 05, 2019, 3:10 PM UTC

adventured wrote: post #103

mrtksn wrote: post #77

Earlier quoted context omitted.

Right now I am again in Turkey after a while. Back then(like 5 years ago?), the USA was seen righteous but demanding country and if you go off-limits bad things can happen to you. Now Turkey acquired Russian made defence system s400 that was supposed to devastate the economy through embargoes. A few years ago a wealthy Iranian businessman living in Turkey was caught laundering billions of dollars through a Turkish st…

> These and many other actions were supposed to make Uncle Sam very angry and punish Erdogan. Nothing of significance happened. Turkey was removed from the F35 program, for which they are a manufacturer. They are barred from purchasing the 100 F35s they wanted. They will lose that manufacturing position and the jobs that go with it. They have been demanding to still have the right to purchase the F35 jets - they will…

See, the F-35 program is not seen as a big deal. The US said that Turkey can be allowed back in if they don't activate the S-400, Turkey went ahead and publicly began testing it.

Also, as it Turns out Turkey does have its own flourishing defence industry and the Brits are helping Turkey to actually build it's own gen 5 warplane and Russia is offering to sell some.

That's the catch with nationalism and authoritarian governments: The citizens are willing to endure economic pain in the name of patriotism and the US doesn't seem to bring much of that anyway.

The US-led world order seems to be vanishing and it's scary when you know some of the alternatives.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#145

Post by tonyedgecombe » Thu, Dec 05, 2019, 3:11 PM UTC

vixen99 wrote: post #65

tonyedgecombe wrote: post #9

Earlier quoted context omitted.

Most of Google's paying customers are businesses, for them an increase in VAT is neutral as they will be reclaiming it.

In other words, the end customer down the line pays.

The end customer already pays VAT.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#146

Post by s1artibartfast » Thu, Dec 05, 2019, 3:11 PM UTC

nwellnhof wrote: post #122

seibelj wrote: post #82

IMO the corporate tax rate should be zero, and then everyone would be on the same playing field. Right now the only companies that pay taxes are small ones without the resources and staff to get around it. With 0% corporate tax, all of these games and shenanigans would end. Also, corporate profits are double-taxed anyway, as taxes are paid once on profits then again as dividends / capital gains by the shareholders. T…

I agree that corporate taxes aren't strictly required. They are useful though, if you think about international capital markets. Without corporate taxes, foreign investors could extract all profits from a company, without paying any income tax in its country of residence. You are right about double taxation, but you can think of corporate tax as a part of income tax that is guaranteed to benefit the country where the…

>Without corporate taxes, foreign investors could extract all profits from a company, without paying any income tax in its country of residence.

Howso? You still have income tax and capital gains tax.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#147

Post by peteri » Thu, Dec 05, 2019, 3:12 PM UTC

orbifold wrote: post #83

matthewowen wrote: post #70

Earlier quoted context omitted.

I think it was a comment about the UK no longer being a member of the EU soon (we shall see).

In fact rumor has it that a major reason for the Brexit campaign was that there was a threat of very costly corporate tax loopholes being closed in new EU wide legislation.

When I looked at this there was a very narrow set of new rules that would need to be introduced into UK law (I found a paper on the EU website, however https://fullfact.org/online/brexit-not-concealing-offshore-a... matches up with my memory).

Primarily the new rules are based on the existing UK rules and I'm guessing whatever legal changes were required are still going through.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#148

Post by smush » Thu, Dec 05, 2019, 3:12 PM UTC

SirLotsaLocks wrote: post #129

seibelj wrote: post #82

IMO the corporate tax rate should be zero, and then everyone would be on the same playing field. Right now the only companies that pay taxes are small ones without the resources and staff to get around it. With 0% corporate tax, all of these games and shenanigans would end. Also, corporate profits are double-taxed anyway, as taxes are paid once on profits then again as dividends / capital gains by the shareholders. T…

corporations benifit from state funded systems, so they should give back to the state. The state funds the streets they drive on, the internet they use computers first created by the government, they use are defended by copyright LAW that the government made to protect companies from copycats, they use money regulated by the government, they use employees that were educated (mostly) by the governemnt, smaller compani…

> we need to crack down on tax evasion

Corporations, small businesses, private citizens all benefit from state funded systems. That's part of the point of having a state in the first place.

It could be seen as hyperbolic to conflate paying the minimum legal amounts with tax evasion. Corporations pay payroll taxes, VAT in relevant countries, capital gains, etc. as required by law.

Whether our laws have large wiggle-room is another matter, but they are not evading taxes. People go to jail for tax evasion.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#149

Post by ixtis7 » Thu, Dec 05, 2019, 3:14 PM UTC

nerdponx wrote: post #75

dangerface wrote: post #60

Earlier quoted context omitted.

Europeans like me like America because they are very vocal about freedom and liberty but we are waking up to the reality that it's all talk. The USA behaves like Russia and China, they spy on foreigners, influence their elections, start unjustified wars for oil and generally have a very low regard for freedom and liberty outside of their soil. USA are not the good guys and Russia and China are not the bad guys they a…

Probably worth keeping in mind that Russian, Chinese, and American people are not their governments. I can't speak for Russia and China, but at least in the USA plenty of people detest their government for all the reasons you've mentioned. Even the "good" years with Obama, people are looking back on that era more cynically than they did at the time.

I think this is largely a Western idea. IMO there is no dichotomy of 'evil Chinese government' and 'liberal silent majority of Chinese people'.

Yes there are restrictions on what people there can say about the party, but it's not North Korea--people say what they really think in private conversations, and from what I've seen they are mostly happy with their government.

Will that change if government performance changes? Possibly, but I don't think there's any noble suffering aspect to it.

Re: Spain planning on going ahead with ‘Google tax’ despite US tariff threats

#150

Post by DoingIsLearning » Thu, Dec 05, 2019, 3:14 PM UTC

sebsito wrote: post #130

dangerface wrote: post #60

Earlier quoted context omitted.

Europeans like me like America because they are very vocal about freedom and liberty but we are waking up to the reality that it's all talk. The USA behaves like Russia and China, they spy on foreigners, influence their elections, start unjustified wars for oil and generally have a very low regard for freedom and liberty outside of their soil. USA are not the good guys and Russia and China are not the bad guys they a…

I'm not sure if the US freedoms are just talk because all those successful companies which Spain wants to tax were started in US not in EU. So Spain with it's $12B of export can risk imposing tariffs (it's essentially a tax at mostly US companies) compared to e.g. Germany which exports much more.

This is a non sequitur, personal freedom has very little to do with availability of VC level funding or an increase in startup investment.

I don't follow your point?