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G7: Rich nations back deal to tax multinationals
301–310 of 931 posts
Re: G7: Rich nations back deal to tax multinationals
#302Earlier quoted context omitted.
> Henry George - a 19th century political economist - proposed exactly this, and suggested the only thing that should be taxed should be land That may have made sense in the 19th century when agriculture dominated the economy, but it’s irrelevant today. At scale it becomes a tax on how space-inefficient your business is. Bad news for farmers, great news for the business running a 1000-person operation out of a skyscr…
Land taxes are based on the value of the land, not the size of the land. The property tax system already performs land value assessments. Land taxes are highly progressive. Note that land taxes are only assessed on the value of the land, not the value of any buildings on the land. This incentivizes land owners to put the land to its highest and best use.
How much land does Google use vs the most successful farmer in a given county?
What’s the value of the land that Google uses?
Re: G7: Rich nations back deal to tax multinationals
#303> It was reported this week that an Irish subsidiary of Microsoft had paid zero corporation tax on $315bn (£222bn) profit last year because it was resident in Bermuda for tax purposes.
This seems wrong. Microsoft didn't even have that much revenue globally last year ($143b) let alone profit ($53b)
Re: G7: Rich nations back deal to tax multinationals
#304Earlier quoted context omitted.
If you’re going down this route, many will argue that all forms of income tax are equally “wrong”. Henry George - a 19th century political economist - proposed exactly this, and suggested the only thing that should be taxed should be land: impossible to hide from a tax inspector, potentially a waste to the public commons if useful land that could be exploited isn’t and you can even protect land you wish to keep prist…
> If you’re going down this route, many will argue that all forms of income tax are equally “wrong”. I frequently come to a conclusion personal income tax should be abolished as it punishes work. CIT, VAT, capital gains and inheritance taxes should be enough to sustain a budget. These are all unrelated to performed work.
I was under the impression that CITs were far, far more distortionary than well structured progressive PITs.
Re: G7: Rich nations back deal to tax multinationals
#305I do wonder if we wouldn't be better off eliminating corporation tax entirely. The revenue of a corporation can, roughly, be: 1. Spent on goods or services from another company (including freelancers, contractors, etc.) 2. Spent on rent 3. Spent on capital purchases 4. Spent on wages 5. Spent on debt repayment or other forms of financing 6. Paid out in dividends 7. Spent on share buybacks 8. Invested in something els…
When companies generate more profit they very rarely do any of the things you mention, why would they start doing it if they didn't have to pay taxes at all? In reality when a company gets to generate more profit the result is an even bigger gap between C-levels and normal employees salaries.
Here is a better idea: companies should be the only entities paying taxes in a capitalist society. If you think about it it really makes perfect sense :) since they already do all the boring accounting stuff and with the power of their lobbies they could make tax law simpler and more efficient (something that normal citizen will never be able to push forward).
Re: G7: Rich nations back deal to tax multinationals
#306Earlier quoted context omitted.
As an Australian who moved to Sweden, I was amazed at how efficient the Swedish income tax process was. The government already knew everything they needed to calculate your return, and gave it pre-filled. There were not endless exemptions. Nobody at my work used an accountant, most approved their tax with a few clicks and were done. So much more efficient than in Australia!
The American tax system is similarly frustrating. I’m a senior engineer and I have a hard time navigating tax forms even with the help of Intuit, and it frustrates me that I have to pay Intuit (or someone else) to help me do taxes which are complicated in large part because Intuit et al lobby for complex tax codes and against the sort of Swedish model you describe. Worse, when I moved to Chicago the state of Illinois…
It's because they're trying to give people breaks on what they owe. The more money you make (and the more ways in which you make it), the more exemptions and breaks you tend to be eligible for, so the more complicated your taxes tend to be. A realistic simplified tax code would probably mean you, as a senior engineer, would pay much more in taxes, which would be fine with me! A properly-funded government can be a great boon to society. But you might not feel the same way, so be careful what you wish for.
Re: G7: Rich nations back deal to tax multinationals
#307Earlier quoted context omitted.
I suspect a whole bunch of companies specializing and being middle men handling this will pop asap.
Is that meant to be a good thing?
I don't make a value judgement I'm just noting that there will be an arbitrage business opportunity and it will be filled by someone.
Re: G7: Rich nations back deal to tax multinationals
#308More taxes = higher prices. In the end buyer is the one who will be charged. +50$ for an iPhone in the US, +50€ in EU and +5000₽ in Russia. People in rich nations will spend proportionally less than people in poor ones obviously. (no serious analytics, just thoughts)
If we're being simplistic, then I could just as well say:
More corporation taxes = lower income taxes
A citizen should be happy that their government is seeking a greater share of its tax revenue from corporations, especially foreign-owned corporations, because it is easier for the citizen to avoid buying an iPhone than to avoid earning income.
Re: G7: Rich nations back deal to tax multinationals
#309Earlier quoted context omitted.
Land taxes are based on the value of the land, not the size of the land. The property tax system already performs land value assessments. Land taxes are highly progressive. Note that land taxes are only assessed on the value of the land, not the value of any buildings on the land. This incentivizes land owners to put the land to its highest and best use.
How much land does Google use vs the most successful farmer in a given county? What’s the value of the land that Google uses?
Google owns more than $50B of real estate...
Re: G7: Rich nations back deal to tax multinationals
#310Earlier quoted context omitted.
One problem is that this would effectively distribute tax revenue from a company by the citizenship of the owners (6 and especially 7) but most countries think they are entitled to some tax revenue from companies operating in their nations even if the company is wholly owned by foreigners.
That’s usually the case of any kind of operation, no? If you use the infrastructure and services of a particular country its seems reasonable to pay taxes on your profits there.
Even without a corporate income tax companies would still generate tax income in foreign countries where they sell goods and services, e.g. VAT/sales tax. They would also pay property tax on any physical presence they maintain and probably a myriad of other taxes depending on the country.