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G7: Rich nations back deal to tax multinationals

bbc.co.uk

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Re: G7: Rich nations back deal to tax multinationals

#471

Post by celticninja »

rjknight wrote: post #162

I 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…

Why should a corporation not pay taxes to support the infrastructure they use (which is paid for by taxpayers) to undertake their business. Amazon ship a lot of goods, that is a lot of road miles. I pay toward the upkeep of the roads and I get considerably less use out of them than Amazon do, in fact they are vital in order for Amazon to do business, so they should be willing to support it. The only reason they dont (support it) is because they are rich enough to argue with the government over it, and that argument is not due to ideological reasons, rather it is because arguing (in court) is cheaper than paying the taxes. So it is just because it is financially beneficial, even if the net effect is negative to society.

Re: G7: Rich nations back deal to tax multinationals

#472

Post by HWR_14 »

reacharavindh wrote: post #403
alien_ wrote: post #382

Earlier quoted context omitted.

Confiscating profits wouldn't work, many companies are reinvesting their profits. Probably the best way would be to just make the fines hurt more, by using a fixed and non-negligible percentage of the monthly/yearly revenue, much like Finland does for traffic fines.

I can’t believe we as a society don’t adopt this idea more. Punishment should be a percentage of taxable income of that year. The impact should equally felt regardless of your current financial status. Extending this to a corporation would simply put them in back foot in a market.. which is indeed the punishment.

In the US, income based fines have questionable constitutional allowability. I fall on the "the seem constitutional" side, but some people apparently think it violates the 8th amendment.

Re: G7: Rich nations back deal to tax multinationals

#474

Post by Bilal_io »

njovin wrote: post #321
Taniwha wrote: post #292

Earlier quoted context omitted.

If you're going to legally treat corporations the same as actual humans - then tax them the same. We pay taxes for services we expect from governments, defence, policing, justice, water, sewers etc etc I don;t see why corporations that use all these things shouldn't pay their share

I look forward to the day that we punish corporations by removing their freedom (ability to operate) instead of fining them laughably small percentages of their yearly revenue for serious violations of laws and regulations. In reality I understand that this would harm the employees and the public to an unacceptable degree so maybe some form of “jail time” whereby all profits go directly to non-executive employees and…

> maybe some form of “jail time” whereby all profits go directly to non-executive employees

In theory this would give an incentive to some employees to mess up if they know they won't get caught.

Re: G7: Rich nations back deal to tax multinationals

#475

Post by mohanmcgeek »

dkersten wrote: post #170
bertil wrote: post #112

Earlier quoted context omitted.

Both Ireland and Luxembourg have legitimate activities: Irish whiskey isn’t a big deal compared to tech, but there’s no real reason to ban it. Defining a line is hard, especially when the country’s traditional advantage _is_ finance, like it is in Luxembourg, even outside of tax-optimisation. It’s easier to have rules against countries with less credibility, but then again, you risk making things complicated for Seyc…

Maybe an import duty needs to be applied. Importing the Irish whiskey will incur a duty. Google US paying a 100% license to Google Ireland should also incur a duty charge for importing the license from Ireland. Something like that, anyway.

Yes! Exactly this.

Except the reason it's not done today is because back in the 90s, people argued that it's not possible to tell if/when services/IP crossed borders because there's no fixed port of entry.

(They were making this argument because software CDs were subject to import duties but downloads were not and that they were unfair)

Today it's still the case and services/IT are not subject to duties.. but I think large licensing agreements like this should definitely attract import duties

Re: G7: Rich nations back deal to tax multinationals

#476

Post by ashtonkem »

rjknight wrote: post #162

I 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…

Absolutely not.

Not only is this massively regressive, it ignores how much of our public infrastructure is built to support the economy. This proposal would effectively allow shareholders to turn infrastructure tax dollars into shareholder money without having to kick a single dime into the bucket. That’s absolutely nuts.

Re: G7: Rich nations back deal to tax multinationals

#477

Post by hosker4u »

andy_ppp wrote: post #130
orf wrote: post #2

Summary: > Firstly, the G7 want a global minimum tax rate so as to avoid a "race to the bottom" where countries can undercut each other with low tax rates. > Secondly, the rules will aim to make companies pay tax in the countries where they are selling their products or services, rather than wherever they end up declaring their profits. Good. It’s a shame that Biden had to back down from the initial 28% because of do…

Biden has been consistently good at this, going in with a crazy bold position and letting people argue him down to somewhere that would probably be his real position in the first place.

This was all pre-biden, just could not go forward with Trump. With Biden it was possible again.

Give him credit for agreeing. Don't give him credit for creating.

Re: G7: Rich nations back deal to tax multinationals

#478

Post by ashtonkem »

IanCal wrote: post #253
mrgordon wrote: post #214

Earlier quoted context omitted.

You’re ignoring that the companies can just keep lots of cash without distributing it to individuals in order to avoid taxation under your system. So for example the company can rent houses, cars, and airplanes for every employee to ensure there is not much money left to be taxed as income. On paper they look like corporate expenses but it’s really just a way to distribute money without it being taxable.

> You’re ignoring that the companies can just keep lots of cash without distributing it to individuals Nobody benefits from a company growing indefinite wealth without distributing it to actual people. > So for example the company can rent houses, cars, and airplanes for every employee If they could do this, all companies would do this already to avoid taxes. In reality, this is dealt with by (in the UK) considering…

> Nobody benefits from a company growing indefinite wealth without distributing it to actual people.

And yet companies actually do this. Perhaps your model of what motivates companies is wrong?

Re: G7: Rich nations back deal to tax multinationals

#479

Post by hosker4u »

walshemj wrote: post #184
orf wrote: post #2

Summary: > Firstly, the G7 want a global minimum tax rate so as to avoid a "race to the bottom" where countries can undercut each other with low tax rates. > Secondly, the rules will aim to make companies pay tax in the countries where they are selling their products or services, rather than wherever they end up declaring their profits. Good. It’s a shame that Biden had to back down from the initial 28% because of do…

nah Biden wanted other countries to raise the rate but wasn't going to address US companies moving revenue from country a to country b.

UK was the holdout that forced this Two Pilar compromise.

Re: G7: Rich nations back deal to tax multinationals

#480

Post by rmah »

ben_w wrote: post #248
amelius wrote: post #159

Earlier quoted context omitted.

> Probably the best solution is a minimum tax worldwide. Wouldn't that make companies pay taxes in countries they are based in (as opposed to where they make money)? Anyway this could be the push that the EU needed to start their own Silicon Valley.

> Anyway this could be the push that the EU needed to start their own Silicon Valley. Given the combined market caps of Apple, Microsoft, and Amazon (~$5.6T) is larger than the national net worth of all but the four largest EU countries, I don’t think there’s a lack of motivation here.

[edit] "all but the four largest"... my bad, I misread. Not sure why comparing mega-corps to small nations has much value though.

Not sure where you got your info, but I'm afraid it seems inaccurate. The total wealth of the four largest EU nations, as of 2019, are as follows:

    Germany: $14.7T
    UK: $14.3T
    France: $13.7T
    Italy: $11.37T
Just FYI, the three wealthiest nations are: the US at $106T, China at $64T, and Japan at $25T.

This info is from a Credit Suisse report and is widely cited (https://en.wikipedia.org/wiki/List_of_countries_by_total_wea..., https://www.visualcapitalist.com/all-of-the-worlds-wealth-in..., etc).

By digging a bit into the US data, those numbers are, if anything conservative. According to the US Federal Reserve Bank, in 2014, the US had total assets of $270T and total liabilities of $146T for a net worth of $124T.

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