G7: Rich nations back deal to tax multinationals • Hacker News Board

Re: G7: Rich nations back deal to tax multinationals

#491

Post by rrrrrrrrrrrryan » Sat, Jun 05, 2021, 5:24 PM UTC

Ericson2314 wrote: post #329

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

But then it's highly unfair to tax humans on revenue , but corporations on profit . I think the right answer is VAT + externalities taxes (LVT, Cabon tax, etc.) + UBI, which is both very easy to enforce and perhaps net progressive enough. Re "progressive enough": I don't so much care if BWM owners are screwed over relative to private jet owners on paper, I think reducing work hours and propping up demand at the botto…

VAT + LVT + misc. pigeovian taxes probably wouldn't be enough to power society as is, let alone fund a UBI. You could maybe replace income tax with a progressive consumption tax or a wealth tax, but you'd need to replace it with something.

Re: G7: Rich nations back deal to tax multinationals

#492

Post by edoceo » Sat, Jun 05, 2021, 5:24 PM UTC

HWR_14 wrote: post #412

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.

> Wouldn't that make companies pay taxes in countries they are based in (as opposed to where they make money)? If an American SaaS company sells a product hosted in Ireland to a company in Britain, where was that money "made"?

Just tax the revenue in the country where the money changed hands. (The client's home) That's the taxable event. So, I think, for your case, Britain (UK)

Re: G7: Rich nations back deal to tax multinationals

#493

Post by sbacic » Sat, Jun 05, 2021, 5:25 PM UTC

zmk_ wrote: post #430

sbacic wrote: post #269

Earlier quoted context omitted.

If it's going to be anything like the digital services tax, then the answer is a resounding yes as the US is where your customers are. I see two things come out of this: 1. Companies selling their B2C services digitally will be paying both their sales (or VAT) AND their corporate income tax in countries where their customers are. This will be a benefit for countries with large markets and leave smaller countries wher…

They still would hire domestically and pay salaries that would be taxed.

They'd need to grow to a certain size first and even then, they could just hire remotely.

My hope is that these rules will only apply to large multinationals but somehow I doubt it - governments are unlikely to leave money on the table and will likely use this opportunity to expand the scope to include smaller businesses as well.

Re: G7: Rich nations back deal to tax multinationals

#494

Post by xxpor » Sat, Jun 05, 2021, 5:25 PM UTC

mohanmcgeek wrote: post #466

Naga wrote: post #15

Earlier quoted context omitted.

It's complicated. "Money they made in their country" is hard to define. Large companies abuse intangible assets to shift profits around, but it's hard to say at what point abuse starts. For example, Google USA sells advertising to its clients. But, the assets it is selling are actually owned by Google Ireland. Google Ireland charges Google USA a license fee of 100% of the revenue they made. Suddenly, Google USA has n…

> Probably the best solution is a minimum tax worldwide. I saw a similar comment earlier this week. I don't understand why first world people think developing countries would agree to this minimum tax and not undercut them on day 1 to attract investments and jobs. There are no global tax authorities. Nobody is going to enforce these things. Even this G7 treaty is going to be a mess in practice because multilateral tr…

The US would sanction them, and then they'd be screwed.

Re: G7: Rich nations back deal to tax multinationals

#495

Post by fighterpilot » Sat, Jun 05, 2021, 5:26 PM UTC

hn_throwaway_99 wrote: post #438

TacticalCoder wrote: post #426

Is this really about taxing multinational companies or is this about establishing a "minimum 15% corporate tax rate" for every SME and mom and pop shop? TFA says that Ireland is going to accept the change: atm they've got a 12.5% tax rate. What about Hungary? Corporate tax rate at 9%. Once this shall be in place, the one sure thing is this "minimum 15%" is only ever go up, never down. There won't be any incentive eve…

> What about Hungary? Corporate tax rate at 9%. That's the whole point of this agreement, it doesn't matter what Hungary does. I mean, if a business wants to only sell in Hungary, sure, but what this agreement does is prohibit multinationals that want to sell in any of these G7 nations from cooking up the corporate fiction where a company is "headquartered" in a low tax jurisdiction, and then the "real" company pays…

How would this work for a business in Hungary with 10 employees, no location elsewhere, who has sizeable US business?

Re: G7: Rich nations back deal to tax multinationals

#496

Post by amelius » Sat, Jun 05, 2021, 5:26 PM UTC

mohanmcgeek wrote: post #466

Naga wrote: post #15

Earlier quoted context omitted.

It's complicated. "Money they made in their country" is hard to define. Large companies abuse intangible assets to shift profits around, but it's hard to say at what point abuse starts. For example, Google USA sells advertising to its clients. But, the assets it is selling are actually owned by Google Ireland. Google Ireland charges Google USA a license fee of 100% of the revenue they made. Suddenly, Google USA has n…

> Probably the best solution is a minimum tax worldwide. I saw a similar comment earlier this week. I don't understand why first world people think developing countries would agree to this minimum tax and not undercut them on day 1 to attract investments and jobs. There are no global tax authorities. Nobody is going to enforce these things. Even this G7 treaty is going to be a mess in practice because multilateral tr…

G7 can say: no more trade on our soil if you don't pay the minimum tax.

Re: G7: Rich nations back deal to tax multinationals

#497

Post by dtwest » Sat, Jun 05, 2021, 5:26 PM UTC

Taniwha wrote: post #292

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…

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

We don't treat them the same, and we shouldn't treat them the same.

Having a multi layered tax policy is complicated and has proved difficult to enforce. Multinational corporations have shown time after time that they are able to get around the first layer of taxation (corporate tax), so why not just eliminate it and put more of the burden on the second layer (income, capital gains, sales tax, etc).

The general idea is not to raise or lower net taxes, in this particular instance we could keep net taxes the same while allowing for less corporate avoidance and more targeted tax collection.

Companies like Amazon historically have minimized their profit to grow revenue, assets and shareholder value. They barely pay corporate tax while profitable small businesses will pay corporate tax plus the second layer.

Re: G7: Rich nations back deal to tax multinationals

#498

Post by StandardFuture » Sat, Jun 05, 2021, 5:27 PM UTC

dgb23 wrote: post #199

Proven wrote: post #9

Sight, those socialist thugs... All of them are above the minimum, so what does that really achieve? Message for the central planners: you can't tax me anything if I don't work. Or if I work but not here. And let's not forget that involuntary taxation is theft.

The massive infrastructure and education is free then?

Crumbling infrastructure and propaganda daycare seem pretty low cost to me. It certainly reflects a low IQ society for sure.

Re: G7: Rich nations back deal to tax multinationals

#499

Post by rcpt » Sat, Jun 05, 2021, 5:28 PM UTC

ashtonkem wrote: post #476

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.

The conversion into shareholder money is where the tax happens.

The idea is that if you want to tax rich people do it directly. Don't make it complicated.

Re: G7: Rich nations back deal to tax multinationals

#500

Post by phkahler » Sat, Jun 05, 2021, 5:29 PM UTC

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…

Similar could be achieved by taxing locally and also having import/export taxes. Other options exist too, but they're aiming for global control.