French tax on startups • Hacker News Board

Re: French tax on startups

#51

Post by rguillebert » Sat, Oct 20, 2012, 7:25 PM UTC

yummyfajitas wrote: post #49

rguillebert wrote: post #37

Earlier quoted context omitted.

"That is generally the case. Unemployment rates in the 8-12 neighborhood are considered a disaster in the US. In France they are normal." Except that the way the unemployment rate is calculated is different in both countries, economists say that you should add 3 or 4% to the American unemployment rate to have comparable numbers.

According to a quick look at Wikipedia, the only apparent difference is that Eurostat requires an unemployed person to be able to start work in the next two weeks, while the US BLS requires an unemployed person to have been able to start work last week. Is it your belief that the difference between "are you able to start work in the next two weeks" and "if a job were offered, could you have started work last week" is…

You have to work less hours in the US to be considered employed, you are considered employed if you work 15 hours a week (my source is Jacques Sapir)

Re: French tax on startups

#52

Post by cdavid » Sat, Oct 20, 2012, 7:30 PM UTC

guylhem wrote: post #43

cdavid wrote: post #36

Earlier quoted context omitted.

France is not (much) different from other comparable countries in Europe on the quoted measure (i.e. Germany, UK and Italy are equally "as poor" as Arkansas and Idaho, using GDP-PPP/inhabitant). So it most likely doesn't have much to do with the original statement, given that Germany has e.g. a much lower unemployment. I am not sure per-state comparison of GDP-PPP per capita are really that meaningful: you would most…

Start with a very rich country - a former superpower that fought with its rival for world domination. I'm not talking about USA and USSR but France and England. The #1 spots comes with lot of advantages like accumulated wealth, educated workforce, etc. Now start to introduce socialist reforms - little by little, and watch the country bleed itself out while its voters supports this self destructive streak being proud…

What makes you think France is destroying its economy ? And what makes you think UK or Germany is that much better ? When you scratch behind the superficial discourses around european economy, some underlying issues are systemic and shared across all big European economies. One of them is the very weak capitalization of banks, and high asset/gdp of the private banking system [1]. This by itself explains a large part of the current European policies (for example, those countries don't/can't recognize that they will need to re-capitalize their banks at taxpayer-expense).

This is much, much more critical than changes in taxes which effects are at best very disputed, and mostly explained by political biases of each side.

[1] (asset / gdp is > 6x GDP for switzerland, > 3x GDP for UK and France, to compare to 0.6 x GDP for the US: http://www.zerohedge.com/sites/default/files/images/user3303...)

Re: French tax on startups

#53

Post by davidw » Sat, Oct 20, 2012, 7:37 PM UTC

twoodfin wrote: post #24

yummyfajitas wrote: post #13

Earlier quoted context omitted.

Don't the Nordic countries have a lot of taxes? Not on corporations. They do tend to have rather high taxes on middle class individuals, however. http://blogs-images.forbes.com/kenrapoza/files/2011/09/Corpo... http://www.forbes.com/sites/kenrapoza/2011/09/09/a-cross-cou...

And in return provide extensive middle class services. Nobody who wants to get elected in the U.S. can say this, but the middle class here increasingly sees more benefits from government while paying less and less for them. The poor are screwed by regressive sales and payroll taxes, while the upper classes face much higher average rates due to income cutoffs on a variety of tax credits and deductions. You can argue a…

> The poor are screwed by regressive sales and payroll taxes

It's worth stating that Sweden has a 25% VAT, which is a bit higher than the average for Europe, but not that much.

Re: French tax on startups

#54

Post by yummyfajitas » Sat, Oct 20, 2012, 8:09 PM UTC

rguillebert wrote: post #51

yummyfajitas wrote: post #49

Earlier quoted context omitted.

According to a quick look at Wikipedia, the only apparent difference is that Eurostat requires an unemployed person to be able to start work in the next two weeks, while the US BLS requires an unemployed person to have been able to start work last week. Is it your belief that the difference between "are you able to start work in the next two weeks" and "if a job were offered, could you have started work last week" is…

You have to work less hours in the US to be considered employed, you are considered employed if you work 15 hours a week (my source is Jacques Sapir)

That is incorrect. All of Europe defines unemployment in accordance with the ILO, and the ILO counts a person who has performed any work as "employed".

http://stats.oecd.org/glossary/detail.asp?id=778

Re: French tax on startups

#55

Post by hnwh » Sat, Oct 20, 2012, 9:31 PM UTC

xyzzyz wrote: post #22

yummyfajitas wrote: post #13

Earlier quoted context omitted.

Don't the Nordic countries have a lot of taxes? Not on corporations. They do tend to have rather high taxes on middle class individuals, however. http://blogs-images.forbes.com/kenrapoza/files/2011/09/Corpo... http://www.forbes.com/sites/kenrapoza/2011/09/09/a-cross-cou...

Ah, I live in one of these countries with low corporate income tax (it's 19% here), and yet right wing here wants to make it even lower to increase entrepreneurship, and everybody complains how hard it is to do business here, because taxes and insurance contribute additional ~13-15% cost to base salary, so that they have to use law loopholes to escape that (which is very widespread, and recent attempts by government…

Which country is that?

Re: French tax on startups

#56

Post by Rexxar » Sat, Oct 20, 2012, 11:07 PM UTC

sterling wrote: post #47

Rexxar wrote: post #46

Earlier quoted context omitted.

'martinced' doesn't say that the country is "runned by dishonest incompetents". He says : - "leave your country" - "Flee France. That country doesn't deserves you" - "it's one of the most socialist country of the planet" He use the word 'socialist' everywhere and in a meaningless ways. We can perfectly have a rational talk about the problem with this law without all this nonsense.

Are you here Rexxar (in France)?

Yes

Re: French tax on startups

#57

Post by Rexxar » Sat, Oct 20, 2012, 11:42 PM UTC

sterling wrote: post #48

Rexxar wrote: post #46

Earlier quoted context omitted.

'martinced' doesn't say that the country is "runned by dishonest incompetents". He says : - "leave your country" - "Flee France. That country doesn't deserves you" - "it's one of the most socialist country of the planet" He use the word 'socialist' everywhere and in a meaningless ways. We can perfectly have a rational talk about the problem with this law without all this nonsense.

How is 'socialist' used in meaningless ways? Socialist in 2012 means someone who believes that wealth should be distributed from wealth-creators to the public sector, with the result that the country as whole grows more slowly than it should. Maybe you are thinking about what "socialism" originally meant, or what it "should" mean. Socialism has been defined by history.

I don't want to have a political discussion on HN. But the original claim that France is "one of the most socialist country of the planet" is ridiculous (http://en.wikipedia.org/wiki/Socialism)

There are problems in France (As there are in other countries). But just saying it's because France is socialist will not help to solve them.

Some people on right see socialism everywhere.

Some people on left see capitalism everywhere.

Some religious people see the devil everywhere

...

But all off this doesn't solve any real problem.

Re: French tax on startups

#58

Post by dllthomas » Sun, Oct 21, 2012, 5:21 PM UTC

yummyfajitas wrote: post #27

dllthomas wrote: post #25

Earlier quoted context omitted.

Institutional VCs will likely be able to account for the income such that they are, at least on paper, re-investing a good portion of the income.

No. A VC fund invests each dollar precisely once and then attempts (over the next 10-15 years) to return those funds to investors when they cash out. Maybe VCs in France will completely restructure their business to avoid this massive tax (presumably incurring lower returns in the process). Or maybe they will just invest outside France. Either way, this is not a small problem for them.

Money is fungible and people are creative; My expectation is that, in the middle-run, that they will be make this no more than a small problem for them.

What are their investors doing with the money? If they intend to pile up a bunch of dollars and swim in it like Scrooge McDuck, then yes, that pile might shrink as a result of this law, but I expect that represents a relatively small fraction of institutional VC money.

As the parent said, if they sell to retire, the income isn't taxed so highly; if they sell to cash out of this investment and put (at least 80% of) it into something else, then the money is being reinvested, and hopefully can be handled as such in the accounting.

Re: French tax on startups

#59

Post by louisdorard » Mon, Oct 22, 2012, 8:57 AM UTC

It's worth noting that equity sales taxes don't concern French companies that have the "JEI" label, i.e. young innovative companies.

There is an issue in the State's definition of "innovative", though. JEIs are companies that spend at least 15% of their resources on R&D, so we're talking about technological innovation. It seems to me that most people agree that other sorts of innovation need to be accounted — either with the same label, or a new one.