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Italy approves 40% windfall tax on banks for 2023 as profits soar

theguardian.com

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Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#131

Post by cykotic »

gruez wrote: post #23
cykotic wrote: post #10

Earlier quoted context omitted.

It does not bother me. But I think there should be a min/max for how much wealth a person has. No one suffers from taxing windfall profits. Windfall , by definition, being unexpectedly high profits.

> No one suffers from taxing windfall profits. Windfall , by definition, being unexpectedly high profits. 1. This is objectively false. Shareholders of the bank suffer, because they get less profits. This may not be a crowd that solicits a lot of sympathy, but they still exist. 2. How do you feel about VCs and startups? Their entire business model is investing in 100 companies, knowing that 99 will fail but 1 will ma…

I think you don't understand what the word suffer means. Those entities don't lose anything. It's not possible to lose something you don't have. In an alternate universe where the windfall tax did not occur those entities have more money. But in this universe they don't lose anything. They don't suffer.

To call it a loss means that money was taken from them. If someone promises to leave me $1 million when they die and then they decide to change their mind I do not suffer. Nothing was taken from me. I did miss out on having $1 million but have suffered no loss. I never had the $1 million to begin with.

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#132

Post by boringg »

FirmwareBurner wrote: post #31
gruez wrote: post #23

Earlier quoted context omitted.

> No one suffers from taxing windfall profits. Windfall , by definition, being unexpectedly high profits. 1. This is objectively false. Shareholders of the bank suffer, because they get less profits. This may not be a crowd that solicits a lot of sympathy, but they still exist. 2. How do you feel about VCs and startups? Their entire business model is investing in 100 companies, knowing that 99 will fail but 1 will ma…

>Shareholders of the bank suffer Won't someone think of the poor bank shareholders? /s

While you seem to be trying to say that bank shareholders are astronomical or just wealthy people and aren't worthy of sympathy. You seem to fail to realize that most 401k holders are bank shareholders as a function of their holdings. They are arguable more hurt than the people who get large gains.

I'm not defending anyones point here but pointing out that you haven't quite grasped how the economy works or alternatively you like snarky little value add comments.

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#133

Post by cykotic »

gwright wrote: post #119
cykotic wrote: post #10

Earlier quoted context omitted.

It does not bother me. But I think there should be a min/max for how much wealth a person has. No one suffers from taxing windfall profits. Windfall , by definition, being unexpectedly high profits.

If you have surprise ad-hoc taxes (i.e. laws) they you no longer have the rule of law. In this case it is almost an ex-post facto law as the tax applies to earnings that occurred before the tax existed. Surprise laws should bother you on general principles. Tax unpredictability, high taxes, or capping profitability is a great way to scare off businesses from operating in your jurisdiction.

I don't know Italian law and don't know if ex post facto tax increases are illegal. I'm guess not since they are enacting such taxes.

Windfall taxes don't bother me.

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#134

Post by gruez »

ilyt wrote: post #121
gruez wrote: post #69

Earlier quoted context omitted.

>I dunno why only wage tax is progressively taxed. Companies are just groups of people. Why should a group of 100 people get taxed more than a group of 100,000 people? Progressive rates on wages make sense because it's applied to each person individually.

Weird argument but okay, then increase tax past say 100k/employed person in company of revenue. Or tax on revenue once company becomes big enough. Taxing on income made sense to make investing into expansion a good thing, but those companies clearly don't need to be bigger, it seems to just make stuff worse and worse.

>then increase tax past say 100k/employed person in company of revenue.

That would cover most professional services firms (eg. lawyers/accountants). I don't really see why they should be considered worse than a mcdonalds.

>Taxing on income made sense to make investing into expansion a good thing, but those companies clearly don't need to be bigger, it seems to just make stuff worse and worse.

TSMC brings in 73.67 billion/year in revenue. Equifax only brings in 5.12 billion/year. Which one is making stuff "worse and worse"? Surely there's a better metric than dollar amounts, which totally ignore the financial nature of the underlying industry?

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#135

Post by esalman »

zmnd wrote: post #61
tensor wrote: post #28

Earlier quoted context omitted.

Unfortunately the old American disease of not ensuring competition and instead passing regulation ensuring monopolies stay in power means the "problem" is not actual solved, and is in fact made worse.

> The US is home to over 4,700 FDIC-insured banks. It’s not far off from the EU, which has 5,171, but stop and consider that the EU consists of 27 countries. The UK currently has 365 banks, and Canada has 83

Forgive me but this kind of comparison is hilarious, given Europe is smaller in area, has more population and way more different countries than the USA.

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#136

Post by cykotic »

Nasrudith wrote: post #102
cykotic wrote: post #10

Earlier quoted context omitted.

It does not bother me. But I think there should be a min/max for how much wealth a person has. No one suffers from taxing windfall profits. Windfall , by definition, being unexpectedly high profits.

You would indeed suffer if your "windfalls" in your retirement accounts were taxed at a high rate.

Profits by definition mean leftover money after all expenses. Paying tax on profit does not incur a loss by anyone. It does mean that someone receives less than if there was no tax but it isn't a loss. You can't suffer if nothing was taken away.

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#137

Post by gruez »

cykotic wrote: post #131
gruez wrote: post #23

Earlier quoted context omitted.

> No one suffers from taxing windfall profits. Windfall , by definition, being unexpectedly high profits. 1. This is objectively false. Shareholders of the bank suffer, because they get less profits. This may not be a crowd that solicits a lot of sympathy, but they still exist. 2. How do you feel about VCs and startups? Their entire business model is investing in 100 companies, knowing that 99 will fail but 1 will ma…

I think you don't understand what the word suffer means. Those entities don't lose anything. It's not possible to lose something you don't have. In an alternate universe where the windfall tax did not occur those entities have more money. But in this universe they don't lose anything. They don't suffer. To call it a loss means that money was taken from them. If someone promises to leave me $1 million when they die an…

>I think you don't understand what the word suffer means.

1. You haven't heard of the saying "suffering a loss" in the context of finance?

2. see definition 3: https://en.wiktionary.org/wiki/suffer#Verb

> Those entities don't lose anything. It's not possible to lose something you don't have. In an alternate universe where the windfall tax did not occur those entities have more money. But in this universe they don't lose anything. They don't suffer.

That's a strange way of putting it. Suppose you were at the casino and won a few thousand dollars. When you decide to cash out they informed you there was a "winnings surcharge" (that they didn't previously tell you about) and took 50% of your winnings. Would you say that you didn't "lose anything"?

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#138

Post by bko »

ilyt wrote: post #125
bko wrote: post #94

Earlier quoted context omitted.

Maybe they won't but new competitors will see the outsized profits and try to get my business by offering these things. I have all these things at my bank (TD) so the system seems to work. This is pretty uncontroversial basic economics...

How often you see "new competitors" in banking come up now ?

Not often enough. You've seen the reverse due to high regulatory costs.

If you're a healthcare provider in the US you often have to get a "certificate of need" to offer a service where a board full of competitors in the neighborhood determine if the neighborhood really "needs" this service:

> CON programs primarily aim to control health care costs by restricting duplicative services and determining whether new capital expenditures meet a community need.

https://www.ncsl.org/health/certificate-of-need-state-laws

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#139

Post by AnimalMuppet »

gruez wrote: post #69
rightbyte wrote: post #49

Earlier quoted context omitted.

Maybe the tax could be progressive to help smaller players? I dunno why only wage tax is progressively taxed.

>I dunno why only wage tax is progressively taxed. Companies are just groups of people. Why should a group of 100 people get taxed more than a group of 100,000 people? Progressive rates on wages make sense because it's applied to each person individually.

In an industry where "too big to fail" is a real thing, taxing bigger companies more seems perfectly reasonable. Not just a little bit - significantly more, even painfully more. Create some actual incentive for banks to not get that big.

Re: Italy approves 40% windfall tax on banks for 2023 as profits soar

#140

Post by prepend »

bko wrote: post #75
madballster wrote: post #21

This is an old European disease. Corporate profits are often seen as an adverse result; of consumers being taken advantage of unfairly. Taxing excess profits beyond what are already high tax rates is popular amongst voters (e.g. see poll results in the UK, 2022). However, this lowers the appeal for new entrants to enter these markets to compete for these excess profits through better and more efficient products and s…

I think that's correct. I have a theory about bullshit jobs in highly regulated or profitable industries. Places like Google have a ton of employees that don't contribute anything but make work projects. Why don't they just cut the workforce in half? Because their profit margin would be too high. It's already 25% with all the bloat. Imagine if their profit margin shot up to 50%? They would likely be dragged in front…

I’ve wondered this too. I don’t think it’s conscious so much as it’s unclear exactly what jobs are bullshit. So when profits are high, there’s more leeway to allow jobs that you’re not quite sure.

But when times are tough you start making riskier jobs because you just don’t have the funds to support bullshit jobs.

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