Three European Countries Block Tax on Tech Giants • Hacker News Board

Re: Three European Countries Block Tax on Tech Giants

#231

Post by bsaul » Tue, Nov 06, 2018, 8:53 PM UTC

sofixa wrote: post #219

bsaul wrote: post #205

Earlier quoted context omitted.

They have a background, a history. They’ve spent the last 40 years adding layer upon layer of tax and subvention mechanism to try to regulate the economy while solving zero fundamental issues ( unemployment, industry, global private sector attractivness, education and recently even healthcare). The only thing they’ve managed to do is to increase the cost of the public sector. So yes, indeed i don’t have any kind of t…

Are you aware that "the government" changes every ~5 years and the majority of recent French Presidents and their parliaments have been on different political spectrums? There is no "they". So what Sarkozy's government was doing was radically different than what Hollande tried to do in the first part of his mandate (he rolled back quickly when he saw it's not making anything better), and it's also different than what…

Are you aware that every single high ranking french administration officer and policy maker for the last 50 years came from the same school ( including bruno lemaire), and that this school recruits almost nobody coming from the private sector ( although this is starting to change, but only very recently).

That’s the « they ». Everybody in the fifth republic believes that the state should regulate the economy, while having absolutely no personnal experience in the private sector. The only differences they have are on society issues, but from the economical point of view i have yet to witness one government that actually lowered the tax ratio ( just look at the CSG which was supposed to be temporary and 3% 25 years ago, and is now still alive and reaches more than 10%)

As for the efficiency of the public sector and the tax system look at france’s tax vs gdp ratio compared to other european country, as well as our ranking in education performance ( both young children school and university). Also have a look at unemployment rates, compared to other european countries.

Edit : to be fair, macron did come from the private sector ( just a few years though), and he did in fact remove a huge chunk of the ISF last year. That was a glimmer of hope. Also another reason why seeing France go back to its old habits makes me mad.

Re: Three European Countries Block Tax on Tech Giants

#232

Post by jfk13 » Tue, Nov 06, 2018, 9:07 PM UTC

bsaul wrote: post #192

bluecalm wrote: post #180

Earlier quoted context omitted.

It does make tons of sense. What doesn't make sense is running a business that doesn't bring profits. Taxing revenue is one idea end accounting shenanigans and unfair practices like price gauging to eliminate competition which is now tax advantages strategy. Iam not a fan of it for other reasons but it does way more sense taxing profits which is just non workable idea. EDIT: replying to child (not possible to reply d…

You do realize the whole concept of a startup is about raising money because you know you can’t both grow fast enough to conquer a new market while at the same time making profits ? Also, some companies like industries have huge revenues but make few profits because of the enormous cost to produce what they sell. Try thinking about the various cases and you’ll soon realize there’s actually a very good reason why corp…

> you can’t both grow fast enough to conquer a new market while at the same time making profits

Maybe it would be a good thing if "grow fast...conquer market" were less of a goal for new companies than building one of a number of stable and sustainable businesses serving a market?

Perhaps we'd get markets where a variety of products and services compete on their features and merits, each having an appropriate place within the overall market, instead of an unhealthy winner-takes-all situation where the startup that gets the most money thrown at it can spend its way to world domination.

Re: Three European Countries Block Tax on Tech Giants

#233

Post by walshemj » Tue, Nov 06, 2018, 9:20 PM UTC

bsaul wrote: post #82

As a french, seing french government officials trying to impose their knee-jerk « let’s tax it » reaction to any kind of problem makes me absolutely sick. They’re just a bunch of jealous incompetent insufferable pompous politicians than don’t understand a thing about the private sector and so instead of trying to fix the numerous reason why we don’t have any competitor to google / facebook etc ( such as our best engi…

How do you feel about having to pay more tax because the big Amarican companies move profits of shore to avoid paying tax?

Re: Three European Countries Block Tax on Tech Giants

#234

Post by yxhuvud » Tue, Nov 06, 2018, 9:23 PM UTC

stickfigure wrote: post #67

mabbo wrote: post #26

Earlier quoted context omitted.

It's an intriguing concept. What effect would a tax purely on size (income rather than profit) have on the world economy, if everyone were to adopt such policies? It would discourage large companies and encourage small ones. It seems like employees do better when there is a bigger and more diverse marketplace for work, ie, many smaller companies. So they would win out, hopefully. Customers may or may not do better. I…

It would not select against size. It would select against low margins. Google and Apple would be fine. Amazon would be toast. Your local supermarket would be toast (avg grocery store margins are 1%). Any startups that are just scraping by, no matter how small, would be toast. You would basically crank up the difficulty level of business across the board. This would generally help successful incumbents by making life…

Supermarkets would just raise the prices though. It is not as if people can choose not to buy food.

Re: Three European Countries Block Tax on Tech Giants

#235

Post by woodpanel » Tue, Nov 06, 2018, 9:32 PM UTC

lultimouomo wrote: post #226

njarboe wrote: post #216

Earlier quoted context omitted.

So an oil company that buys steel pipe to make an oil well doesn't pay VAT on the pipe? Not a European, so just asking.

Either it pays the VAT and gets an equal tax credit, or it doesn't pay it at all (when applying reverse charge). Result is the same, VAT is not a cost for enteprises. Obviously the fact that end consumers pay VAT might disincentivise them to buy stuff, so companies still suffer the effects of high VAT rates.

> Result is the same, VAT is not a cost for enteprises.

That's just partly true. Depending on the taxing agreements between two countries involved you can apply reverse charge, yes. But within one company's country, the VAT is not something that you can "just refund" from the government. Instead you can set off the VAT you've paid against the VAT your customers paid.

In other words: The only way for you pay zero VAT is if your earnings (income minus expenditures) are zero too (something that despite the tax-evasion clichés is something that companies usually try to avoid).

Re: Three European Countries Block Tax on Tech Giants

#236

Post by briandear » Tue, Nov 06, 2018, 9:43 PM UTC

ajnin wrote: post #150

bsaul wrote: post #82

As a french, seing french government officials trying to impose their knee-jerk « let’s tax it » reaction to any kind of problem makes me absolutely sick. They’re just a bunch of jealous incompetent insufferable pompous politicians than don’t understand a thing about the private sector and so instead of trying to fix the numerous reason why we don’t have any competitor to google / facebook etc ( such as our best engi…

> how come all those companies HQ in europe are in ireland Ireland has been busted (among others) for secretly passing sweet taxation deals with Google, Facebook, Amazon & co. According to you, that's the way to do it, right ? Tax race to the bottom, give deals to big player that no small company has hope to ever negociate, that's sure to bolster competitors. Any kind of attemp to level the playing field by applying…

Why should Ireland be able to determine the taxation policies of Ireland? The EU doesn’t set immigration law for Ireland does it? Why should it be allowed to dictate tax law? Low taxes can be a competitive advantage to fiscally responsible countries, why must the EU try to “fix” that?

Re: Three European Countries Block Tax on Tech Giants

#237

Post by BalinKing » Tue, Nov 06, 2018, 9:49 PM UTC

ambicapter wrote: post #190

dsfyu404ed wrote: post #123

Earlier quoted context omitted.

I'm from the US. You could just replace France with the name of my state in your comment and it would hold. We don't even have scooters yet and they're talking about passing regulation in case it becomes a thing. Some places are really used to using regulation to (attempt to) solve problems and when you've been swinging a hammer for the past several centuries it doesn't really matter whether the nails you think you'r…

So what you're saying is, we shouldn't use laws to fix things?

I don't think that's as unreasonable as you make it sound. Laws should not be the knee-jerk reaction to every problem; there are many who think they should be effectively be a last-resort measure (when there truly is no other alternative). Obviously, there is large political disagreement on this issue (viz: conservatives vs. liberals, to use American jargon).

Re: Three European Countries Block Tax on Tech Giants

#238

Post by woodpanel » Tue, Nov 06, 2018, 9:55 PM UTC

simias wrote: post #210

Shivetya wrote: post #172

Earlier quoted context omitted.

having a uniform tax code would pretty much doom the small economies to not having opportunity to grown unless it was "granted to them" as a favor by the same union government. the ability of member states to set their own taxes is about the only protection they have handling down turns and getting new industry. their currency was given up and without the ability to print money they need other means to mitigate adver…

I agree that "uniform" wasn't the right word, I was thinking more about cooperating and managing taxes as a whole (in order to find a compromise that would benefit everybody). It doesn't mean that everybody would have the same taxes but at least there would be some level of coherency. >In the US it works by forcing states to compete on regulation and taxes which benefits everyone. Everyone except the environment at l…

> Then we give the Irish exactly the same amount they're currently receiving

Please don't take this the wrong way but: There's a whole body of tax-literature and tax-philosophy that renders such a statement naive.

How do you figure e.g., how the current money Ireland makes is linked to the increase or decrease of tax-rates? How is it linked to other factors making Ireland worthwhile to invest? How much was Ireland accumulating on those other factors, because it has been a tech tax haven so long? How much future growth of these factors is taken from Ireland because of your proposed regime? And how do you deal with a decrease in overall EU tech tax income (per country) because of your proposed regime? Would you e.g. go so far as to pay Ireland its current income even if the overall EU tech tax income would be lower? Would you otherwise grow Ireland's pay with an increased overall EU tech tax income, beyond Ireland's current income, and if so what would be Ireland's fair share?

And while those questions can have multiple correct answers, those questions have to be answered in a consistent way, because rule of law. And that consistency alone is often enough a problem, because other countries have other consistencies their taxing has to apply to, again because rule of law. And those laws are usually not just paper, but codifications of hundreds of years of cultural norms and customs.

Re: Three European Countries Block Tax on Tech Giants

#239

Post by rdm_blackhole » Tue, Nov 06, 2018, 10:00 PM UTC

bsaul wrote: post #82

As a french, seing french government officials trying to impose their knee-jerk « let’s tax it » reaction to any kind of problem makes me absolutely sick. They’re just a bunch of jealous incompetent insufferable pompous politicians than don’t understand a thing about the private sector and so instead of trying to fix the numerous reason why we don’t have any competitor to google / facebook etc ( such as our best engi…

I agree with OP. I am French as well. I can confirm that for a French politician, any issue can be solved by adding a new tax. Tax for this, tax for that and whatever else.

They just have no clue about what to do so they try to tax it.

Well, guess what, people who actually want to achieve something productive, who want to make a good living, who want to start a company and not see our profits taxed again and again to feed a bunch of bureaucrats who have never even run a business before, those people they have already left and they are not coming back.

Re: Three European Countries Block Tax on Tech Giants

#240

Post by unilynx » Tue, Nov 06, 2018, 10:13 PM UTC

woodpanel wrote: post #235

lultimouomo wrote: post #226

Earlier quoted context omitted.

Either it pays the VAT and gets an equal tax credit, or it doesn't pay it at all (when applying reverse charge). Result is the same, VAT is not a cost for enteprises. Obviously the fact that end consumers pay VAT might disincentivise them to buy stuff, so companies still suffer the effects of high VAT rates.

> Result is the same, VAT is not a cost for enteprises. That's just partly true. Depending on the taxing agreements between two countries involved you can apply reverse charge, yes. But within one company's country, the VAT is not something that you can "just refund" from the government. Instead you can set off the VAT you've paid against the VAT your customers paid. In other words: The only way for you pay zero VAT…

That's not how VAT works. As a simple example for a EU company:

- buy something nationally (you pay VAT to the company) - export it to another EU company (reverse charge, so no VAT received or paid) - get the VAT refunded from your local tax agency.

Even nationally, you get VAT refunded if you've paid more to others than you've collected. At least for NL, but I'm pretty sure these rules should be the same in all EU countries.