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Tech giants face 2% UK digital services tax

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Re: Tech giants face 2% UK digital services tax

#171
post #114
post #74

Earlier quoted context omitted.

It will not “hurt” people in the UK. If that tax passes through and is applied, it’s possible that the price transfer will only apply to UK residents. In that case, the Treasury will have more money to spend on services for UK residents which would hardly be hurtful.

I take it you have never encountered the competence of a U.K. government-run service?

I grew up in the UK and I’ve lived there for the last four years. I’ve lived and paid taxes in six other countries so I’m happy to compare.

There certainly are possible improvements, but it’s overall very well managed and there are here many aspects of how civil servants are trying to improve at the same time the cost, the efficiency, the quality but also how to think about the service that touched me. The National Health Service, for instance, is a little bare-bones but the cheapest developed health service there is. The Land Registry is incredibly helpful, especially when you depend on reliable, sensical data for your business. The BBC is expensive but peerless. Transport for London, for all its sins and there are many, transport more people, faster, further, more reliably than anyone; it’s heavily dependent on having redundancy rather than reliability but at least it works often enough. Social services are minimal and insufficient, but nowhere else can people find jobs so easily if they are motivated and willing to learn. That is also not just due to companies, but also government services that manage to let people employ others without making it too difficult.

I sincerely believe that the same system, without the stress that the Tory government is putting on the budget for education, police and health, could be world-class.

Re: Tech giants face 2% UK digital services tax

#172

This will start out as 2% in 2020 but probably be 10% by 2030. That's usually how these things work in the UK.

for some value of "usually" corporation tax: 30% in 2008, 19% in 2018 zero rate band of income tax: £3000 in 1990, £11850 today (the increase is more than double that of inflation)

Personal allowance (zero tax band) raised to £12,500 from April (in the Budget today).

This gives money to richer voters because the higher your earnings, the more tax saved. But corporation tax takes money from rather anonymous entities, which of course affects voters too in the end but in a rather indirect way.

Re: Tech giants face 2% UK digital services tax

#173
post #74

Earlier quoted context omitted.

It will not “hurt” people in the UK. If that tax passes through and is applied, it’s possible that the price transfer will only apply to UK residents. In that case, the Treasury will have more money to spend on services for UK residents which would hardly be hurtful.

Sure but then why not just raise taxes on UK citizens? The whole point of this tax is to penalize the "tech giants" which happen to all be American, and it won't really do that.

Those companies are 100% American: they rely on technologies like the Web invented by an English scientist working at the frontier of France and Switzerland. They rely on algorithms invented by Russian, French, German scientist. They hire students from university around the world, to be engineers, managers, salesperson for clients also from everywhere in the world.

If those companies want to keep on hiring people without staggering student’s debt, they need to contribute to the local economy. I know they already do that (I worked for such companies for long enough, and paid a lot of taxes locally) but my point was twofold:

- paying more tax is often a good thing for the people who are going to benefit from the corresponding government services; that is certainly the case in the UK;

- if your company develops, promotes and sells products in a country, it makes sense to also pay added-value- and profit-tax there, and not avoid tax by claiming that the value was created in a tax shelter like Suriname, where you have no activity.

Re: Tech giants face 2% UK digital services tax

#174

Earlier quoted context omitted.

Honestly, you have to be pretty ignorant to hold this opinion.

Actually it is more informed than ignorant. Remove Sweden and UK from the the European list and you have needles in a haystack. Even if you account for the 'unicorn' adge there is barely have innovation in Europe. On the social front too too, European pay and ownership is more concentrated in the hands of the leaders and is less evenly distributed than American counterparts. Your comment strikes me a bit as if it com…

> On the social front too too, European pay and ownership is more concentrated in the hands of the leaders and is less evenly distributed than American counterparts.

I would be very surprised if this was the case. Could you please back this statement with data?

Re: Tech giants face 2% UK digital services tax

#175

The UK has gotten very frustrated with the slow movement of international lawmaking in this space. With business rate slashes to help struggling retailers (retaliation against Amazon) and mental health funding increases for schools (retaliation against Facebook/Google), I'm quite happy to see something happen at last. I expect other governments to follow suit. From a tech defence angle, I can't see Trump rallying in…

> The UK has gotten very frustrated with the slow movement of international lawmaking in this space The space of... international laws to transfer money for literally no reason to the government of the UK, even though they have no services or investments to recuperate related to the money in question? I mean, it's fair that everyone asks for a slice of the pie, but that doesn't mean it's fair that they take it.

The slice of the pie? If these companies are upset about it, they can just leave the UK market.

Re: Tech giants face 2% UK digital services tax

#176
post #172

Earlier quoted context omitted.

for some value of "usually" corporation tax: 30% in 2008, 19% in 2018 zero rate band of income tax: £3000 in 1990, £11850 today (the increase is more than double that of inflation)

Personal allowance (zero tax band) raised to £12,500 from April (in the Budget today). This gives money to richer voters because the higher your earnings, the more tax saved. But corporation tax takes money from rather anonymous entities, which of course affects voters too in the end but in a rather indirect way.

> This gives money to richer voters because the higher your earnings, the more tax saved.

a rise of the zero rate equally effects anyone earning above the new zero rate threshold (regardless of how much they are above it [1])

a full time minimum wage employee earning ~£14,000/year gets exactly the same reduction in tax from this specific increase as an engineer on £90,000/year

[1]: once you get above £100,000/year your personal allowance goes down (ultimately to zero)

Re: Tech giants face 2% UK digital services tax

#177

The UK has gotten very frustrated with the slow movement of international lawmaking in this space. With business rate slashes to help struggling retailers (retaliation against Amazon) and mental health funding increases for schools (retaliation against Facebook/Google), I'm quite happy to see something happen at last. I expect other governments to follow suit. From a tech defence angle, I can't see Trump rallying in…

> The UK has gotten very frustrated with the slow movement of international lawmaking in this space The space of... international laws to transfer money for literally no reason to the government of the UK, even though they have no services or investments to recuperate related to the money in question? I mean, it's fair that everyone asks for a slice of the pie, but that doesn't mean it's fair that they take it.

When AWS in teh UK can grant share awards of £11.8m to staff, but only pay £155k in tax, that doesn't seem like they are paying their fair share in UK tax.

Re: Tech giants face 2% UK digital services tax

#178

The UK has gotten very frustrated with the slow movement of international lawmaking in this space. With business rate slashes to help struggling retailers (retaliation against Amazon) and mental health funding increases for schools (retaliation against Facebook/Google), I'm quite happy to see something happen at last. I expect other governments to follow suit. From a tech defence angle, I can't see Trump rallying in…

> The UK has gotten very frustrated with the slow movement of international lawmaking in this space The space of... international laws to transfer money for literally no reason to the government of the UK, even though they have no services or investments to recuperate related to the money in question? I mean, it's fair that everyone asks for a slice of the pie, but that doesn't mean it's fair that they take it.

It's their kitchen.

Re: Tech giants face 2% UK digital services tax

#179

The UK has gotten very frustrated with the slow movement of international lawmaking in this space. With business rate slashes to help struggling retailers (retaliation against Amazon) and mental health funding increases for schools (retaliation against Facebook/Google), I'm quite happy to see something happen at last. I expect other governments to follow suit. From a tech defence angle, I can't see Trump rallying in…

> The UK has gotten very frustrated with the slow movement of international lawmaking in this space The space of... international laws to transfer money for literally no reason to the government of the UK, even though they have no services or investments to recuperate related to the money in question? I mean, it's fair that everyone asks for a slice of the pie, but that doesn't mean it's fair that they take it.

I think the space is their market, in which they set the rules and may want to tip things one way or another to prevent starvation and entire dependence on external parties.

In the general case, it's once thing to let an industry shrink because they are out-competed, it's another entirely to let them shrink to the point where recovery is extremely hard or event nearly impossible because of the loss of domain knowledge.

In addition, there's also first mover advantage, and in some industries that can mean the first mover dominates to such a degree that fair competition (market information is distorted) is hard. There's nothing inherently wrong with trying to alter the market, it all depends on the goal and methods. If this were applied towards bolstering competition by incentivizing Europeans offerings, that might benefit everyone eventually.

Re: Tech giants face 2% UK digital services tax

#180

I know this gets said a lot, but I live for the day the world sees innovation and quality tech companies from Europe instead of taxation and regulation.

> innovation and quality tech companies from Europe

Brit here (still in Europe for the moment). There is a lot if you include aerospace and pharma, less if you just consider software. The only non-British European software I've used and could remember off the top of my head was SAP.

This made me think - what countries have sourced the software on my home PC? It's mainly American with a couple of outliers: e.g. New Zealand for Otoy's Octane renderer, a UK anti-virus package (ESET), and ... that's it.

EDIT: Oops, ESET is Slovakian.

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