211–220 of 238 posts
This will start out as 2% in 2020 but probably be 10% by 2030. That's usually how these things work in the UK.
Can you give any examples?
Also, the Rates scheme only payed by home owners became the Poll Tax levied on all which became the Council Tax levied on all households. Another tory party abomination.
This looks like it is on gross sales? If so that would hurt low-margin companies quite a lot; I imagine Amazon would be essentially forced to increase prices by 2% for example.
And that wouldn't be the end of the world for bricks and mortars retailers now, would it? The UK is seeing the high street decimated with many chains closing scores of shops, or closing outright. That's awful for people who can't, or don't want to, shop online - and also leads to less tax being collected on the whole as Amazon et al siphon their money to places where they've managed to strong arm a sweetheart deal.
The obvious counterargument is that a 2% increase in cost on almost everybody amounts to a pretty awful amount of disutility when you aggregate across the whole population, and it's regressive as it hits low-income people the hardest. But because of the boiling frog effect, nobody notices that sort of hurt enough to complain about it.
I'm not taking a pro-Amazon position here; just pointing out that a gross-receipts tax is a pretty blunt instrument.
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> 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.
This looks like it is on gross sales? If so that would hurt low-margin companies quite a lot; I imagine Amazon would be essentially forced to increase prices by 2% for example.
The problem is for highly global, IP based companies it is very difficult to tax profits. You can just create a 'cost' (platform license fee, trademark cost) in another sister company (that is in a low/no tax jurisdiction) and charge it to the UK based one that is equal to the profit. Boom, no profit due to tax. Not really sure what the best solution is. The UK isn't really big (or competent, depending on your outloo…
I've heard about such limitations with some convoluted options like charging rent to your corporation being bound to market rates at maximum.
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.
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The fairest way is to pay tax where you do business, you know, like you’re supposed to. It’s not really different for tech companies or global companies.
But it's much more complicated than that because the system is not meant to either incentivise or disincentivise insourced vs outsourced functions (and what you seem to be suggesting would create incentives for offshore outsourcing for them, which would be politically unpopular). And corporation tax is a tax on profits, not revenue (VAT already exists and is a tax on revenue and Amazon UK pays a very large amount of…
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“Why weren’t you already charging more, if you could?” Would be my obvious first question at that point, if I was a shareholder.
Because the competitive equilibrium doesn't allow it unless the cost curve shifts for everyone at the same time.
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Honestly, you have to be pretty ignorant to hold this opinion.
So I keep hearing but not ever seeing. I know people on the internet love to talk Europe up as some leading tech innovator, but there's a reason why Americans worry about competition coming from either inside America or China. Europeans should worry more about building quality companies and broadening their tax base instead of getting salty about the money saved from foreigners.
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And how would that work? Google and Facebook could charge more for ads which impacts mostly the advertisers, Amazon could in fact increase the prices impacting average Joes in the UK, but they would lose the advantage over smaller competition unaffected by this kind of tax. This is a globalisation tax that would most likely not affect "normal" people while still bringing quite a few pounds to the national budget.
> Google and Facebook could charge more for ads which impacts mostly the advertisers How does that work? There is no level of indirection after which the money somehow comes from some magical place. This is still paid for by the consumers in the end. Somebody pays for the ads and the cost of that is factored into whatever the ads are for.
Now that's not to say there isn't merit to both sides of the argument that some level of tax is too little and some level is too much. But not in the UK. The UK is firmly in the tax too much camp, as is most/all of Europe.
If I want to pay someone to, say, be my lawyer. And the person I hire for that wants an iPad, then of every 1GPB I pay to the lawyer, 23 cents ends up as revenue for Apple (making revenue for apple is WHY that person wants to be my lawyer, in other words, it's the reason for there to be any economic activity at all in this relationship). 77 cents ends up in the governments' hands to spend (of which, I might add, the government spends about 104 cents). That's ... just not reasonable (and also why every UK company lawyer has to defend all the executives for free to keep his job, to cheat this system)
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But it's much more complicated than that because the system is not meant to either incentivise or disincentivise insourced vs outsourced functions (and what you seem to be suggesting would create incentives for offshore outsourcing for them, which would be politically unpopular). And corporation tax is a tax on profits, not revenue (VAT already exists and is a tax on revenue and Amazon UK pays a very large amount of…
> Amazon UK pays a very large amount of VAT. Amazon collects a very large amount of VAT, no? It's the customers who are paying, not Amazon.
Hell, customers' are the ones paying Jeff Bezos' capital gains tax by that reasoning.