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Three European Countries Block Tax on Tech Giants

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Re: Three European Countries Block Tax on Tech Giants

#281

Post by joejerryronnie »

bluecalm wrote: post #186
Isofarro wrote: post #168

Earlier quoted context omitted.

If US corporations hike their prices up to cover the tax, that would increase the competitiveness of local companies who have already been paying their fair share of tax. Perhaps that's the encouragement governments need to stimulate the local economy further.

Sounds like tariffs. If you want that - fine it makes sense. Just don't bully others to apply tax rate of your choosing on terms you want on business outside your country.

Just about everything the EU does these days is blatant protectionism. This short sighted focus on punishing successful foreign competitors vs growing strong local companies just weakens Europe in the long run and exacerbates the very problem they are trying to solve.

Re: Three European Countries Block Tax on Tech Giants

#282

Post by flosim »

tormeh wrote: post #202
nradov wrote: post #74

Earlier quoted context omitted.

Why would a sovereign state even need permission from others about purely internal matters such as corporate income tax rates?

They don't. What Ireland has signed on, is that, just as in any EU country, the corporate tax must be equal for all. National or local governments cannot negotiate deals with specific companies. This is a promise they have broken, and the cause of all the noise about Irish tax. Seeing so many people discussing this under wrong assumptions, even on HN, makes me sad and makes me think there's a very low ceiling on tax…

These conclusions are only yours. One could argue that although the ceiling could be pretty low, it's not something that is set in stone.

Besides, it's not like your alternative is any more appealing anyway. I'm not so sure about the absolutism of saying "oh, it's not perfect, so let's just abolish it completely to make sure countries get even less to subsidize healthcare and education".

Before implicitly calling other people braindead next time, maybe consider that none of us are 100% right and we are all just having a discussion.

Re: Three European Countries Block Tax on Tech Giants

#283

Post by flosim »

slededit wrote: post #132
nradov wrote: post #74

Earlier quoted context omitted.

Why would a sovereign state even need permission from others about purely internal matters such as corporate income tax rates?

This should help explain Brexit a little better. The EU is about giving up sovereignty. It may or may not be a fair trade depending on your POV. But people talk about it like the EU is a no brainer by looking only at economic grounds.

For me, the whole aspect on which the EU is a no-brainer is peace, and leverage against powerful lunatics and maniacs, like Trump and Putin. Which is precisely why the latter is hell-bent on dismantling it.

Not from the economical standpoint.

Re: Three European Countries Block Tax on Tech Giants

#284

Post by xps »

I feel that if that law was to pass, the affected companies would simply add that 3% tax to the prices European consumers pay, especially since this is a tax on the revenue and not on profit.

It's not like US tech giants have much competition to fear from European companies anyway. A 3% price increase isn't going to get anyone to switch to another service (except maybe in the case of Amazon's physical sales).

In the end, consumers would pay and this would add to the already large price difference between the EU and the US, due to the much higher applicable VAT in the EU, as well as other similar taxes applied in some EU countries (private copying levy [0], eco-participation [1]...).

[0] https://en.wikipedia.org/wiki/Private_copying_levy

[1] https://fr.wikipedia.org/wiki/Éco-participation

Re: Three European Countries Block Tax on Tech Giants

#285

Post by lultimouomo »

woodpanel wrote: post #264
lultimouomo wrote: post #259

Earlier quoted context omitted.

Would you say employers pay income taxes for employees if they retain part of their wage and forward it to the state as a down payment for the employee income tax? I wouldn't say so; income tax is paid by the employee, even if the employer is forwarding the money to the state. It doesn't matter who puts the money in an envelope and goes to the tax office; it matters who is subject to the tax. Non-EU turists traveling…

Sorry, but I think you didn't read my comment. No tax is paid by the customer. He always pays gross. For example: you run a barber shop, mens haircut 10 €, womens 10€. You charge mens from your VAT-exempt company, women from your non-VAT-exempt company. Regardless of what you get in net, the customers hand you 10€ each. However the government takes 2€ from your womens hair cutting business, after you've filed your ta…

> If I may ask: Do you run a business where you have to deal with filing VAT on a regular basis? I'm asking because this misconception that businesses don't have to pay VAT is something that I've held myself, obviously because I didn't knew back then what I was talking about.

I very much do, I file quarterly and deal both domestically, intra-EU with reverse charge and extra-EU which is VAT exempt.

You're conflating the fact that you're filing VAT reports and forwarding VAT money to the state with the fact that you're paying VAT. These are two different things.

Again, do you pay employees? Do you retain some money from their wages and forward that to the state as a down payment on their income taxes[0]? Would you say that personal income tax is a tax on companies?

[0] I think this is usual in Europe; it surely is how it works in Italy

Re: Three European Countries Block Tax on Tech Giants

#286

Post by TulliusCicero »

flosim wrote: post #279
TulliusCicero wrote: post #229

Earlier quoted context omitted.

I think many people here believe the correct thing for politicians to do would be focusing on making their own countries more competitive when it comes to having tech giants of their own, and they view regulations or taxes like this as being partially the result of 'sour grapes' that their own countries are less successful in this arena.

More competitive, OK. Who doesn't want their country to be more competitive anyway, whatever that means? Certainly no one in their right mind would argue to make it more diverse, more educated while we're at it? How about you share how you think this could work? While I agree for more competitiveness for my country, history has shown me repeatedly that low taxes isn't actually working out that great. Equating low tax…

Why would it be lower taxes? All the major tech hubs in the US are in higher tax areas (by US standards). If lower taxes were the solution, you'd see Silicon Valley in Texas or Oklahoma or somewhere like that.

Re: Three European Countries Block Tax on Tech Giants

#287

Post by TulliusCicero »

moorhosj wrote: post #271
TulliusCicero wrote: post #229

Earlier quoted context omitted.

I think many people here believe the correct thing for politicians to do would be focusing on making their own countries more competitive when it comes to having tech giants of their own, and they view regulations or taxes like this as being partially the result of 'sour grapes' that their own countries are less successful in this arena.

The rub is what “more competitive” actually means. I get the feeling lots of people think it means lower taxes, but limited government also hurts a company’s ability to hire educated employees if lack of funding hurts education.

If being more competitive meant lower taxes, Silicon Valley wouldn't be in California, it'd be in Oklahoma or Kansas or Utah, or some other GOP state that pushes lower taxes.

Re: Three European Countries Block Tax on Tech Giants

#288

Post by bsaul »

Rexxar wrote: post #265
woodpanel wrote: post #251

Earlier quoted context omitted.

> VAT is tax for consumers, not corporations Sorry, but where does this misconception come from that companies don't pay VAT? It's not true, I see it on my company's tax statement every month ;-)

The answer is that company is the tax collector, not the tax payer. IMHO it's mainly a semantic distinction, the result is practically the same.

it’s absolutely not the same. If the VAT goes up 10%, your benefits after taxes won’t change one bit.

VAT is indeed not paid by corporations.

Re: Three European Countries Block Tax on Tech Giants

#289

Post by chopin »

briandear wrote: post #236
ajnin wrote: post #150

Earlier quoted context omitted.

> 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?

For sure the EU sets at least parts of the immigration law of Ireland. Every EU citizen is free to settle there. Even more, Ireland is a Schengen party, so any visa or legal immigrant of a Schengen member must be accepted to Ireland as well.

Re: Three European Countries Block Tax on Tech Giants

#290

Post by belorn »

SilasX wrote: post #218
bsaul wrote: post #207

Earlier quoted context omitted.

http://gs.statcounter.com/search-engine-market-share/all/eur...

I don't think "monopoly" is best judged by "current market share", but by whether a) it's easy for users to switch, and b) whether having that market share is self-reinforcing in a way that prevents competitors from entering. The parent's point was that a) is not true for Google as a search engine. b) doesn't seem to be true either; while money and experience can make you provide better search results, you don't get…

b) whether having that market share is self-reinforcing in a way that prevents competitors from entering.

The argument is that large market share cause user capture. It is relative trivial to bring online an alterative youtube, but video creators can't switch unless the audience also switch and the audience can't switch unless the creators also switch. A subpar job by youtube won't automatically mean that competitor can disrupt, and a lot of users, content creator, advertisers, basically every type of users has been cited as disliking youtube but being locked in with no realistic alternative.

a) it's easy for users to switch

For google search, online stores that use google for advertisement and getting new customers can't easily switch as that would result in abandon 90% of new customer. They can't just buy their hot dog elsewhere. Online stores have to deal with google, unless their customer base is located elsewhere.

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