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France has approved a digital services tax despite threats of retaliation by US

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Re: France has approved a digital services tax despite threats of retaliation by US

#271

Post by colpabar »

jwr wrote: post #241
ripdog wrote: post #28

Earlier quoted context omitted.

Those large tech companies can make money in France because the french government provides all that is necessary for a free, fair and functioning market. How could Google make money in France if there was no french police force, education system, market regulation, court system, contract enforcement? All money made on the white market in any country is facilitated by that government, and taxes are paid on all profits…

> Those large tech companies can make money in France because the french government provides all that is necessary for a free, fair and functioning market. How could Google make money in France if there was no french police force, education system, market regulation, court system, contract enforcement? Also, those large tech companies can sell to French customers because French customers have money to buy from them.…

Don't you think that a company might just raise their prices to pay for those taxes?

Re: France has approved a digital services tax despite threats of retaliation by US

#272

Post by whb07 »

Absent all this talk about fairness or not, if one were watching CNBC today, Cramer and the other analysts were asking themselves "what exactly is France selling to the U.S" and this is the list they came up with:

1. cheese 2. wine 3. ....

After a couple minutes on the discussion, they came up with Airbus (not strictly French and made outside of France).

Re: France has approved a digital services tax despite threats of retaliation by US

#273

Post by zmk_ »

ApolloFortyNine wrote: post #201
1gn1t10n wrote: post #183

Earlier quoted context omitted.

As far as I understand VAT's role in the economy, the Value Added Tax is offset to the last link of a value-adding chain: the consumer. This creates the incentive of further adding value to a product/service and thus creating more economic output. Amazon may be paying other taxes, but VAT is paid by the consumer.

It's a sales tax. In the EU it's fitted into the price the consumer sees. From every sale Amazon makes 20% of that is going to the government. You could easily argue every tax on Amazon is a tax on the consumer. If you increase the cost of Amazon doing business, prices go up.

Just because the seller is responsible for transferring the tax revenue to the tax office does not mean that the seller is the one paying it.

Re: France has approved a digital services tax despite threats of retaliation by US

#274

Post by leetcrew »

corneliusphi1 wrote: post #267
sverige wrote: post #226

Earlier quoted context omitted.

All taxes are a slippery slope. Name one that has ever been repealed. Income tax in the U.S. started out as a modest 3% on only the highest incomes and look where that has ended up: full on wealth redistribution. We can argue whether that's a good thing or not, but not whether there's a slippery slope when it comes to implementing a new tax.

In 1944 the highest US tax bracket was 94%

GP asked for a tax that was repealed, not reduced.

Re: France has approved a digital services tax despite threats of retaliation by US

#275

Post by julienfr112 »

There may be a complication : As EU is a single market, US retaliation (except maybe on Champagne and Camembert ...) cannot be targeted on France but on the whole EU. For example, Airbus headquarter is located in the Nederland, and has factories all over Europe. As such, EU will have to enter a fight a single country started. I really wonder what will happen next. Maybe Texas could raise the tax on red sole shoes https://www.google.com/search?q=red+sole+shoes ?

Re: France has approved a digital services tax despite threats of retaliation by US

#276

Post by eurg »

hmartiniano wrote: post #262
charlesdm wrote: post #220

Earlier quoted context omitted.

Correct in theory. But have you looked at french tax policy? The issue with new taxes is that often it starts at 3%, then goes up gradually to 5, then to 7, and before you know it you have a 15% turnover tax. France is a lovely country, but one of the worst players when it comes to tax policy. The never ending appetite to increase the spending of the state does not stop...

Which is actually a good idea: increase tax on revenues for companies using tax-evasion schemes until it is no longuer profitable for them to continue doing so. Also, consider the fact that tax evasion is a crime in most countries and that this is a very bland measure when compared to what these companies (and their executives) really reserve.

increasing taxes makes tax-reduction-strategies _more_ profitable, not less

also, tax-evasion and tax-reduction are two different things, equating them is an argument in bad faith

Re: France has approved a digital services tax despite threats of retaliation by US

#277

Post by bonzini »

ElFitz wrote: post #203
vonmoltke wrote: post #186

Earlier quoted context omitted.

Why isn't the solution then to force all companies doing business in France to register with the French government and pay taxes on the portion of revenues derived from France?

Considering only foreign ones (local ones are already covered), the first explanation I can find is that for most of them it would just be an expensive and pointless exercise. The time and costs involved to setup, maintain and enforce such a system would be ridiculously high compared to what it would bring in. Another answer (still only considering foreign businesses) would be that for companies making so little, the…

It's probably forbidden by EU regulations.

Re: France has approved a digital services tax despite threats of retaliation by US

#278

Post by weberc2 »

JAlexoid wrote: post #240
weberc2 wrote: post #184

Earlier quoted context omitted.

I'm trying to follow the argument in good faith, so bear with me... > This gives you an unfair advantage over, say, a brick-and-mortar store or a physical ad agency in Paris that's trying to compete online. Are you sure it's "an unfair advantage" and not just "an advantage"? Doesn't your position presume that the brick-and-mortar business model deserves special protection? If so, why? If not, what then is unfair abou…

> Are you sure it's "an unfair advantage" and not just "an advantage"? Having the option to not comply with laws, is an unfair advantage. >reduce or remove corporate tax and raise sales tax or similar VAT is a sales tax, effectively, but even that is managed away fairly easy. It's an efficient tax, but when it comes to B2B activity it's effectively unpaid. Amazon, though is a retailer, has a very large amount of B2B…

> Having the option to not comply with laws, is an unfair advantage.

All parties in this scenario are legally compliant.

> VAT is a sales tax, effectively, but even that is managed away fairly easy. It's an efficient tax, but when it comes to B2B activity it's effectively unpaid. Amazon, though is a retailer, has a very large amount of B2B business.

How does its B2B business help Amazon evade taxes? When I think about AWS, the billing doesn’t seem to lend itself to any obvious sales tax evasion schemes...

Re: France has approved a digital services tax despite threats of retaliation by US

#279

Post by baby »

colpabar wrote: post #271
jwr wrote: post #241

Earlier quoted context omitted.

> Those large tech companies can make money in France because the french government provides all that is necessary for a free, fair and functioning market. How could Google make money in France if there was no french police force, education system, market regulation, court system, contract enforcement? Also, those large tech companies can sell to French customers because French customers have money to buy from them.…

Don't you think that a company might just raise their prices to pay for those taxes?

It's up to them to figure out where's the right trade off to maximize their gains.

Re: France has approved a digital services tax despite threats of retaliation by US

#280

Post by opportune »

eanzenberg wrote: post #264
opportune wrote: post #195

Part of me originally wanted the US to retaliate since this theoretically threatens my paycheck, but a 3% tax on revenue generated within the country is pretty low and seems reasonable considering how ineffective taxing profits is due to loopholes. I really don't think it's sour grapes so much as trying to address the Irish/Luxembourgish tax schemes

A tax on revenue is very different than a tax on profit.

A tax on revenue makes sense in a very high margin business like software
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