Earlier quoted context omitted.
Looking at you, Ireland.
Ireland did the right thing. The 1980’s and 1990’s were bleak times.
And the 2020s and 2030s are going to be even bleaker, now.
EU adopts global minimum 15% tax on big business
171–180 of 266 posts
Re: EU adopts global minimum 15% tax on big business
#172Earlier quoted context omitted.
If you're trying to do fair taxation do away with "profit" taxes entirely. Not like any of us plebs get to dodge taxes by spending our income. Subtract what the company spends on salaries from its total revenue and then charge them 20-30 percent of the remainder just like the rest of us pay. "Corporations are people" after all. Toss in a seven percent sales tax on all stock purchases.
That would instantly bankrupt every single company in the many industries with single-digit profit margins.
True. Proposal of parent could be made more realistic by making sure only few things like bill of materials, resale items and personnel costs can be deducted. Companies already keep track of all these things.
You will have to go after financialization tricks, where healthy companies get loaded with debt, weird tricks with assets and all the stuff the finance industry comes up with that has nothing to do with core function of the company. Now imagine the powerful lobby you have to work against.
Re: EU adopts global minimum 15% tax on big business
#173Earlier quoted context omitted.
Tax companies that are currently hiding profits in tax havens. The idea is basically that companies headquartering in tax havens will get taxed anyway, until they pay 15% total global tax on those profits. No single country can do this, but when almost all countries agree to do it then companies can no longer hide.
Please educate us how companies are hiding profits in tax havens. Asking for a friend.
One mechanism is via a Double Irish with a Dutch Sandwich https://www.investopedia.com/terms/d/double-irish-with-a-dut...
Another example is leveraging the secrecy provided by states such as South Dakota, Nevada, Delaware, etc. via anonymous shell companies: https://en.wikipedia.org/wiki/United_States_as_a_tax_haven
Re: EU adopts global minimum 15% tax on big business
#174Earlier quoted context omitted.
If you're trying to do fair taxation do away with "profit" taxes entirely. Not like any of us plebs get to dodge taxes by spending our income. Subtract what the company spends on salaries from its total revenue and then charge them 20-30 percent of the remainder just like the rest of us pay. "Corporations are people" after all. Toss in a seven percent sales tax on all stock purchases.
That would instantly bankrupt every single company in the many industries with single-digit profit margins.
I would personally be in favor of a ~5% flat tax on corporate revenue across the board if it meant replacing the convoluted profit-based tax schemes that currently exist. The costs of compliance and "tax minimization" are already a couple percent of revenue for many companies, so replacing that cost seems very reasonable.
Re: EU adopts global minimum 15% tax on big business
#175Earlier quoted context omitted.
That would instantly bankrupt every single company in the many industries with single-digit profit margins.
True. Proposal of parent could be made more realistic by making sure only few things like bill of materials, resale items and personnel costs can be deducted. Companies already keep track of all these things. You will have to go after financialization tricks, where healthy companies get loaded with debt, weird tricks with assets and all the stuff the finance industry comes up with that has nothing to do with core fun…
Yup, gets pretty complicated. Seems like it'd be easier to forget about corporate tax, and charge income tax on every dollar going from the company to an individual.
Re: EU adopts global minimum 15% tax on big business
#176This 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…
Is this a tax on profits? If so, I worry it will remain weak to hollywood-accounting attacks: it's easy to spend money until there are no 'profits'. I'd really love to see progressive taxation of corporate revenue: the bigger a company is the higher the tax rate. Huge corporations benefit from economies of scale, so there is an incentive for power concentration. This power concentration is bad for society: it deliver…
> it's easy to spend money until there are no 'profits'.
If they have to spend the money in the same country as they gained the profits, that might work as intended.
Re: EU adopts global minimum 15% tax on big business
#177Earlier quoted context omitted.
Is this a tax on profits? If so, I worry it will remain weak to hollywood-accounting attacks: it's easy to spend money until there are no 'profits'. I'd really love to see progressive taxation of corporate revenue: the bigger a company is the higher the tax rate. Huge corporations benefit from economies of scale, so there is an incentive for power concentration. This power concentration is bad for society: it deliver…
It’s weird that individuals are taxed on revenue but corporations are (usually?) taxed on profit.
Not really. If you imagine a supply chain with raw materials at one end and finished products at the other, if every step along the chain is taxed even a small amount on their total revenue, the cumulative effect would completely dwarf the value of the final product.
To solve this, in most countries, companies are taxed VAT instead, so intead of taxing the total value of product at every step, you are only taxing the value the company adds in the process.
Effectively the government is taxing the total value of the product at a fixed rate once but that tax is being split among the companies which helped supply that product proportionally to the value added by each company.
Re: EU adopts global minimum 15% tax on big business
#178Earlier quoted context omitted.
Tax companies that are currently hiding profits in tax havens. The idea is basically that companies headquartering in tax havens will get taxed anyway, until they pay 15% total global tax on those profits. No single country can do this, but when almost all countries agree to do it then companies can no longer hide.
Please educate us how companies are hiding profits in tax havens. Asking for a friend.
Re: EU adopts global minimum 15% tax on big business
#179Earlier quoted context omitted.
Is this a tax on profits? If so, I worry it will remain weak to hollywood-accounting attacks: it's easy to spend money until there are no 'profits'. I'd really love to see progressive taxation of corporate revenue: the bigger a company is the higher the tax rate. Huge corporations benefit from economies of scale, so there is an incentive for power concentration. This power concentration is bad for society: it deliver…
It’s weird that individuals are taxed on revenue but corporations are (usually?) taxed on profit.
How would you define how much profit an individual made last year?
Re: EU adopts global minimum 15% tax on big business
#180> European leaders praised the decision, with Germany's Chancellor Olaf Scholz describing it as a "project close to my heart". French President Emmanuel Macron said the country had been pushing the idea for more than four years. Of course countries with high taxes are all for raising taxes in countries where they are lower! Now, unfortunately the article does not mention the interesting bit, which is that EU countrie…
Your wondering is justified, and (like almost every other EU issue nowadays) Hungary was a holdout opposer, and used the vote to blackmail in other areas. They struck a deal in a "package" that includes Ukrain aid as well, in return they got some of the EU funds that was held back because of corruption. What a great happy Union this is. https://www.politico.eu/article/eu-deal-hungary-drop-vetoe-r...
> What a great happy Union this is.
Also the EU repeatedly called out Hungary for corruption but now Hungary is having its moment pointing that several member of the european parliaments have been caught in a very serious corruption scandal (and these are only those who got caught).
What a great happy honorable Union full of integrity we enjoy too.