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EU adopts global minimum 15% tax on big business

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Re: EU adopts global minimum 15% tax on big business

#111

Post by cjbgkagh »

mywittyname wrote: post #106
tmtvl wrote: post #99

Earlier quoted context omitted.

Then where do we get the money to pay for things like the justice system, law enforcement, national infrastructure, unemployment benefits, healthcare, pensions, customs, diplomats,...? Switch to a system where the government owns everything and gives people what they need if they work properly?

Inflationary/deficit spending. The MMT argument for taxation is that it's necessary to encourage demand for a currency, thus making it more valuable. But there's no fundamental reason that a government which controls its own currency must collect taxes to pay for various services. Congress could pay state and local governments directly each year. If you're willing to throw away some property rights, then state and lo…

My favorite MMT detail is the currency lock up accounts to reduce inflation. Basically they prevent people from spending money until inflation decreases. They claim it's not confiscatory as people will get their money back eventually and not taxation because it's the same amount of money. Despite their claims it is indeed both of those things as the real value of the money has decreased.

Re: EU adopts global minimum 15% tax on big business

#112

Post by jandrewrogers »

mywittyname wrote: post #97
dantheman wrote: post #87

Earlier quoted context omitted.

Are you confusing profit with revenue? The revenue is in France - easy. Profit is revenue - cost, which costs do you factor in?

At some point, I think governments are going to need to break down and start taxing revenue instead of profits. A 3% tax on total revenue is the same as a 15% tax on the profits of a product with 20% profit margins.

Taxing revenue has turned out to be a terrible idea every time it has been tried. It creates perverse incentives that encourage companies to be inefficient and wasteful.

One of the biggest policy problems with revenue taxes is that the effective tax rate is much higher on smaller companies than larger companies. A large vertically integrated company like Apple would pay a lower effective tax rate on an iPhone than any of their competitors, giving them a natural advantage. These are pretty dis-economic policy outcomes and the main reason no one seriously considers revenue taxes.

Re: EU adopts global minimum 15% tax on big business

#113

Post by dadjoker »

consumer451 wrote: post #12
poszlem wrote: post #4

> "Today the European Union has taken a crucial step towards tax fairness and social justice," EU economy commissioner Paolo Gentiloni said. There is a saying in Poland: "The difference between > and > is the same as the difference between > and >. I wish we would actually listen to the those countries, when it comes to topics like socialism and communism. Though I suspect the Western European countries need to taste…

I am sitting in Poland, grew up under the thumb of the Soviets, but I don’t see the connection to a global minimum tax. Are you saying it’s like communism?

IMO yes. As I see it, this is countries with high taxes being jealous of countries with lower taxes, and so instead of maybe lowering taxes to become more competitive, they - along with the bloated EU leadership - bully the countries with a logically lower tax into raising theirs, so the bullies feel better about themselves and don't lose "their" tax money.

This is the inherent problem of the EU, from both a social and economic standpoint; the member countries lose their competitive advantages over other countries because the socialistic EU bureaucrats can't handle any one country a) having any type of competitive advantage over another and b) not conforming to what they want.

Re: EU adopts global minimum 15% tax on big business

#114

Post by chmod600 »

johnchristopher wrote: post #84
Negitivefrags wrote: post #33

I don't really like this kind of idea because it really goes against a kind of fundemental freedom. "If you don't like it, you can leave". Instead, laws around making sure that the profits generated from a countries citizens are taxed by that country make more sense to me. A lot of laws around that already exist, and I suppose a lot of people would say that they have not been effective. A lot of it comes down to the…

> I don't really like this kind of idea because it really goes against a kind of fundemental freedom. "If you don't like it, you can leave". That's not fundamental freedom, that's a variation on Hobson's choice.

I assume you refer to people who can't reasonably leave for whatever reason.

But even if you can't leave, seeing the results of another country that does something a different way is a valuable comparison point that can drive a change of policy where you are.

Re: EU adopts global minimum 15% tax on big business

#115

Post by Marsymars »

bee_rider wrote: post #95
redm wrote: post #70

Earlier quoted context omitted.

It's where the profits are, not where the cost centers are. If the customers are in France, the profits are in France.

What if Netflix France has to license their content and platform from Netflix US, the the license costs are coincidentally exactly the same as the revenue made in France? Then there will be no profits in France.

Apply business purpose test to license cost calculations.

Re: EU adopts global minimum 15% tax on big business

#116

Post by HEmanZ »

tmtvl wrote: post #99
dantheman wrote: post #89

Earlier quoted context omitted.

Ideally both should not be taxed.

Then where do we get the money to pay for things like the justice system, law enforcement, national infrastructure, unemployment benefits, healthcare, pensions, customs, diplomats,...? Switch to a system where the government owns everything and gives people what they need if they work properly?

I think OP means that there should be one or the other, not both. Just increase the rate of one if you need more money instead of inventing a new one to double-tax the same income stream

Re: EU adopts global minimum 15% tax on big business

#117

Post by msh »

toast0 wrote: post #54
torben-friis wrote: post #43

Earlier quoted context omitted.

Surely if, say, netflix is offered to french costumers profit is made in france?

Why should the profit be made in france if the engineering that went into delivery was made in the US, the content was made in X, the deal for the content was negotiated in Y, network source is Z (probably france, but not necessarily) VAT in France on the subscription makes sense, but figuring out where the profit lies, is more nebulous.

You could argue that the profit is made where the money is made.

Re: EU adopts global minimum 15% tax on big business

#118

Post by rogers18445 »

mywittyname wrote: post #106
tmtvl wrote: post #99

Earlier quoted context omitted.

Then where do we get the money to pay for things like the justice system, law enforcement, national infrastructure, unemployment benefits, healthcare, pensions, customs, diplomats,...? Switch to a system where the government owns everything and gives people what they need if they work properly?

Inflationary/deficit spending. The MMT argument for taxation is that it's necessary to encourage demand for a currency, thus making it more valuable. But there's no fundamental reason that a government which controls its own currency must collect taxes to pay for various services. Congress could pay state and local governments directly each year. If you're willing to throw away some property rights, then state and lo…

Predictable large inflation each year with no taxes may make theoretical sense in some models. But it seems like it would not be compatible with human psychology.

Re: EU adopts global minimum 15% tax on big business

#119

Post by cjbgkagh »

rsj_hn wrote: post #78
poszlem wrote: post #56

Earlier quoted context omitted.

It being a "global goal" is exactly what I don't like. I don't especially care if a country wants to tax their citizens whatever high. My problem is only when we reach a state of a "global government" deciding what's best for specific countries.

There is really not much to look forward to in Europe besides trying to police others.

The continent already feels like it's trying to tax itself to death. I don't know how Europeans survive, and this was before the energy crisis. I do worry European wealth will start to evaporate and we'll see the kind of social strife that occurs when the pension funds run out and people who were promised dignity into old age find out they're not going to get it.

Re: EU adopts global minimum 15% tax on big business

#120

Post by moonchrome »

brnt wrote: post #100
Nextgrid wrote: post #34

Earlier quoted context omitted.

Out of curiosity, how do you define where profits are made when it comes to selling digital services? There is no physical movement of goods. Do you determine it based on where the software was originally written?

For VAT this is already defined (in the EU): wherever the purchaser is when they get their goods handed to them. If I drive over the border to Germany, I pay German taxes. If I buy online and have it shipped to the Netherlands, I pay Dutch taxes. A digital good is handed to me wherever I am when I purchase it, so I pay taxes in that jurisdiction.

That's not a good analogy - VAT is simply added to base price at the time of purchase. Profits are entirely different - how would you account expenses for example. Not to mention various tax benefits that differ from country to county.
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