131–140 of 266 posts
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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?
The person buying is usually on planet earth and inside a country. This country is where the profit was made.
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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 a…
A large purpose of the EU is to remove those trade barriers to make the economy more efficient. Of course some countries figure out how to take advantage of the single market using regulatory arbitrage, quickly entering a race to the bottom. Thus the EU is becoming the regulator in a lot of (non-tax) areas to prevent this. This is just the next logical step in this regard.
It’s worth noting that any EU rules on taxation are decided with unanimous consensus. No country here has to do anything against their will.
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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.
If you sell concert tickets, would this mean that you need to book the profits in the respective countries of anyone anywhere in the world?
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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.
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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.
This isn't really as big a deal as it's been made out to be, IMO. This is Pillar 2 of the OECDs tax reform for corporations. Pillar 1 is much more interesting, and would require corporations to actually book profits where they are made (so not putting everything through Ireland for example). This will have a much bigger impact imo than this 15% ruling, because right now there are a bunch of tricks you can use to get…
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?
So if a company had $100B global revenue and $10B global profit and 0% of the profit was in France while 10% of the revenue was in France, then the company should be taxed based on the $1B profit that can be attributed to France based on revenue there.
Any other scheme seems it’s prone to creative licensing schemes and similar.
Meanwhile the Swedish government is giving massive incentives to Amazon, Google, Facebook and Microsoft to build data centers (and I assume other countries do too). Almost zero taxing on electricity and actual monetary payouts. In other words, this is a bit of a headline without any actual teeth (there’s plenty of ways to compete unfairly), which is the problem when you start wanting to govern the world, you can’t co…
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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.
I strongly support immediately jailing anyone found to be playing these licensing games. They're parasites who have no place in society until they've shown reform.
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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?
If I was trying to invent some “fair taxation scheme” I’d tax the profit based on the revenue in that country. So if a company had $100B global revenue and $10B global profit and 0% of the profit was in France while 10% of the revenue was in France, then the company should be taxed based on the $1B profit that can be attributed to France based on revenue there. Any other scheme seems it’s prone to creative licensing…
Why is that fair? In your example, if UK provided 100% of the labor shouldn’t UK get 100% of the tax to support social programs for that 100% labor?
Labor seems a better way to distribute and incentivize employment.
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If I was trying to invent some “fair taxation scheme” I’d tax the profit based on the revenue in that country. So if a company had $100B global revenue and $10B global profit and 0% of the profit was in France while 10% of the revenue was in France, then the company should be taxed based on the $1B profit that can be attributed to France based on revenue there. Any other scheme seems it’s prone to creative licensing…
> If I was trying to invent some “fair taxation scheme” I’d tax the profit based on the revenue in that country. Why is that fair? In your example, if UK provided 100% of the labor shouldn’t UK get 100% of the tax to support social programs for that 100% labor? Labor seems a better way to distribute and incentivize employment.
Work effort could be distorted in whatever fashion the country wants. They could declare all their work is done in some off shore 0% tax nation and pay nothing.