Earlier quoted context omitted.
Okay then list it
Trade tax is another example
You are not exempt from trade tax.
If you make more than 25k you have to pay it like anyone else.
Exit Tax: Leave Germany before your business gets big
441–450 of 567 posts
Re: Exit Tax: Leave Germany before your business gets big
#442Earlier quoted context omitted.
Capital gain tax is stupid anyway. It's one of the first tax that should be removed. You can tax business at home by land/revenue/resources usage/ip protection taxes. As it is owners in different jurisdictions pay a different (or sometimes no) tax on selling shares. Selling itself is something you want to encourage, not discourage. It's a pointless tax that penalizes exactly the things you want to encourage. You thin…
IMO corporate income tax is the first that should be removed, with a corresponding shift to income taxes. Those can be as progressive as you want, have much lower compliance costs, and don’t distort behavior in the same way. Thought in practice I’m not sure how tax collection from foreign owners would work.
I would rather argue for the following
- No PIT on dividend income, which is fair since CIT has already been paid on the money earned by the firm(and paid bt by you as a shareholder in that firm)
- CIT payable only on dividend distribution, not yearly so if a firm keeps on re-investing in the firm paying salaries/suppliers and investing in growth they don't pay any CIT.
Another side effect of 1) is that it would cause companies to distribute dividends rather than doing stock buyback since dividend would have a lower tax rate(0%) than the STCG/LTCG tax rate on stock appreciation.
This is how estonia does it, so we already have some data on effectiveness of this.
Re: Exit Tax: Leave Germany before your business gets big
#443Earlier quoted context omitted.
So if all your money is tied up in your company you have to sell part of your business in order to be allowed to leave the country and by the way thanks for creating all those jobs? Sounds slightly CCP to me.
I know of at least 4 countries that have exit taxes, and while the US doesn’t have an exit tax if you simply move abroad (it does if you renounce citizenship) it has other very punitive taxes for expats. So, it isn’t a unique thing to Germany or, assuming you’re correct, China.
> US doesn’t have an exit tax if you simply move abroad
The US doesnt have an exit tax because, for the purpose of taxation, you can't leave.
Re: Exit Tax: Leave Germany before your business gets big
#444Earlier quoted context omitted.
Without society it's pretty hard to be well off in the first place. The entire concept of property becomes pretty meaningless without some very basic concepts of a legal system and territorial integrity. Without that you can only own what you can physically defend. Wealthy people and large companies do generally employ security, but that is merely supplemental. They enjoy the backdrop of a society where the vast majo…
> Without society it's pretty hard to be well off in the first place. What a pointless argument - you could just as easily chose cause and effect in the other direction: without businesses then society has nothing. Zero businesses, zero tax income. My main point is that society needs to encourage business owners. If marginal tax is too high, then owners have no incentivise to earn themselves an extra dollar. When own…
I find this softer position much more amenable than your GP comment.
However, you conflate "businesses" with "entities that pay only some minimal poll tax". It turns out that progressive tax does not preclude complex society. Corporate tax does not kill business on touch. All you've argued for is the existence of the Laffer Curve.
Commercial activity predates currency, and is omnipresent across every tax system that has ever been tried. Where money, there trade. Where trade, there value-add. Or at the very least, combing the beach for pretty shells.
There are tribes without the concept of personal property or money, that make things and build value. No tax can extinguish human creativity.
I'm cagey about secondary effects, but I'm cautiously optimistic about debasing the trait of self-enrichment. I see no reason to take on faith that people acting out of self-actualisation would build a lesser technology. You know you're on a site full of nerds, right?
The existence of the internet protocols is a case in point.
Conversely, I prefer a world without facebook and robocalls.
Re: Exit Tax: Leave Germany before your business gets big
#445Earlier quoted context omitted.
The best civic thing a business can do is provide a valuable service and thereby make money. Just look at all the wonderful things we have as a result - airplanes, internet phones, air conditioning, cars, agriculture, movies, AI - the list is endless.
The Internet evolved from Arpanet, a network established by DARPA. Given that was created by a government agency, and therefore funded by the same taxes companies are trying to avoid, I'd argue that it's a great example for why companies should indeed follow their civic duties and pay their taxes. It's also worth pointing out that many of those "wonderful things" had to be regulated by governments due to how bad thei…
The internet evolved from the telegraphy network, which was not created by the government.
Besides, I've listed several times a number of other networks that sprang up. If it wasn't Arpanet, one of the others would have become dominant. The reason is simple - anyone with two or more computers tried to connect them together. The notion that we'd still not have any interconnections between them if it wasn't for Arpanet is just silly.
As for bad environmental effects, socialism has a much worse track record. Free markets produce enough surplus that costly mitigations become practical.
Re: Exit Tax: Leave Germany before your business gets big
#446Earlier quoted context omitted.
> benefitted from Irish government services, schools, police, fire services, etc. You participated in the community (hopefully), used roads That is a terrible basis for argument: we mostly each get similar usage of services (roads, police, yadda yadda) which should be an argument for a fixed amount of tax per person (a poll tax). If you wish to argue that we get what we pay for: then rich people pay wayyyyyy more so…
> The wealthy surely don't get better policing _Surely not._ > rich people pay wayyyyyy more Citation needed > so they should get more government services ...such as corporate welfare, political influence, favourable prices on public land and institutions, regulatory capture? The acid test for your frame is whether you would have made as much wealth on a desert island, with no market, no value-added inputs, no commun…
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Re: Exit Tax: Leave Germany before your business gets big
#447Earlier quoted context omitted.
It is at least not wildly regressive like consumption taxes are. It would be better to tax IP protection, inheritance, resource use and land only but realistically if we get rid of capital gains the tax burden will land squarely on wage earners doing all of the actual work who are already taxed more than the people who own their productive output.
> It is at least not wildly regressive like consumption taxes are. Why is it just assumed that regressive taxes are bad?
If you want to make a case that regressive taxes are not bad, feel free.
Re: Exit Tax: Leave Germany before your business gets big
#448Earlier quoted context omitted.
> That's the reasoning we're applying if we tax unrealized gains on stocks (or any other asset). We take what the highest bidder is willing to pay for some tiny percentage of an asset, and assume that means everyone else could get the same price, yielding these theoretical valuations that have no bearing on reality. We take what the highest bidder is willing to pay, as well as what the lowest seller is willing to sel…
Because different market participants have different views, risk tolerance and needs. The market argument only works for very high liquidity public stocks. Even then it's unlikely Musk or Zuckerberg can sell their equity at the price of the day. It completely fails for smaller businesses.
The monetary (note: monetary) value of anything and everything is determined by when the minimum value which a seller accepts to sell it for is equal to the maximum value a buyer accepts to buy it for.
If you by some hacker magic know of any way to circumvent this fundamental logic, then you will become the richest man in history within less than a year, since you will then buy for less than anybody is willing to sell for and sell for more than anybody is willing to buy for.
Re: Exit Tax: Leave Germany before your business gets big
#449Earlier quoted context omitted.
Ah great, not so bad then! So you just need to: - Form a German holding company to manage the business - Deal with any conflicting taxation/regulatory issues when operating a german holding company from your new country of residence (in some countries this is not trivial) - Visit Germany twice per year and potentially more to deal with German authorities that require things be done on paper and in person (hope you di…
How on earth are Tesla, Uber, and T-Mobile not "high-tech"?
They're not exactly building leading-edge stuff, though they sometimes buy from companies that do.
Out of those you could only make an argument for Tesla, because at least they were pushing the envelope for a short while in the past (though more from a business standpoint), rather than merely operating within the possibilities of existing technologies others created.
Generally a high-tech company will have significant research (not development) spending, which T-Mobile and Uber don't.
But that chart is awful either way.
Re: Exit Tax: Leave Germany before your business gets big
#450I was someone who almost got hit by this tax. You don't need any offshore shenanigans to get around it. If you just want to move out of the country you can also just keep the ownership of the company within the country. You do this by putting your shares into a holding that stays in Germany even when you move out. That holding needs to be managed within Germany, so you need to assign a friend or be in Germany twice a…
No reasonable person on the planet can look at that table showing a €700k exit tax on a company making €200k/yr profit and think "yeah that sounds fair."
I wouldn't say its fair, but it's good for Germany. In the US, I don't like American companies moving to other countries.