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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

#61

Post by alwayseasy »

bko wrote: post #15

I never understood the logic behind taxing large internet businesses. The idea behind taxes is that you use some public resource and you pay for that service. You own a home in a neighborhood, you pay property tax that funds the schools. You drive a car, you pay gasoline tax that funds the streets. You hire workers locally, you pay the tax to pay back all the contributions public institutions made to adding the skill…

Even staying with the framework of "public resource use". They benefit from the attractive market created by the country. An educated, safe and healthy population with high bandwidth internet with disposable income ready to buy on Amazon.

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

#62

Post by alt_f5 »

kzrdude wrote: post #35
alt_f4 wrote: post #25

Trump is right on this one -- this measure is definitely anti-competitive and specifically aimed at American tech companies. I hope he is swift to retaliate with appropriate tariffs. Failing to do so will bring a wave of random EU taxes on American tech companies, which will eventually lead to lower profits and engineer salaries.

Oh no, won't someone please think of the U.S. software.engineers. And oh no, access to a market also means legal and tax responsibilities?

> Oh no, won't someone please think of the U.S. software.engineers.

Next time you're wondering why you're a Senior Software Engineer with 10 years of experience, but only making 45k EUR in a major European metro area and can never afford to own your own home, please don't forget to remind yourself that you'll get to stay for free in the hospital for the 2 weeks before you die in your late seventies.

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

#63

Post by tzs »

Vinnl wrote: post #19
bko wrote: post #15

I never understood the logic behind taxing large internet businesses. The idea behind taxes is that you use some public resource and you pay for that service. You own a home in a neighborhood, you pay property tax that funds the schools. You drive a car, you pay gasoline tax that funds the streets. You hire workers locally, you pay the tax to pay back all the contributions public institutions made to adding the skill…

> What public resources did Amazon, a US company, use from France? Digital infrastructure, anti-poverty programs that mean potential customers still have something to spend, financial infrastructure, legislation, ...

Shouldn't that be covered by the 20% VAT that Amazon pays on goods and services sold to entities in France?

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

#64

Post by Renaud »

bluecalm wrote: post #54
99052882514569 wrote: post #3

Taxing digital companies based on digital presence certainly makes sense to me, as a layperson. A company that's selling ads to a French company that wants to show those ads to French users is doing business in France, end of story. Taxing only very large corporations - that's a little more questionable, but plenty of countries (including the US) treat small businesses preferentially, so it's not like it's unpreceden…

It's really not that simple. They don't use any of the country infrastructure or workers. If I make a video game and sell it to a person in France does it mean I do business in France? It seems to me it should be treated the same as French person coming to my country, buying my game and going back home. We've just skipped on unnecessary traveling. Those things are subject to debate and power struggle but it's clear t…

>France does it mean I do business in France? It seems to me it should be treated the same as French person coming to my country, buying my game and going back home.

In that case you, the vendor, would need to pay taxes where you sold the game.

The problem with these large companies is that they basically pay little to no taxes _anywhere_, an optimisation that only large companies can really afford.

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

#65

Post by 99052882514569 »

tachyonbeam wrote: post #26
bko wrote: post #15

I never understood the logic behind taxing large internet businesses. The idea behind taxes is that you use some public resource and you pay for that service. You own a home in a neighborhood, you pay property tax that funds the schools. You drive a car, you pay gasoline tax that funds the streets. You hire workers locally, you pay the tax to pay back all the contributions public institutions made to adding the skill…

In the case of Amazon there's a clear protectionist argument to be made. It will kill local businesses and send a bigger share of the profit to an American company. Replace jobs in those small independent businesses by underpaid corporate jobs at Walmart 2.0. Amazon is in a position where it can sell items at a loss for years just for the sake of killing small competitors. Granted, maybe it's the role of antitrust la…

Rather than focusing on a particular company (Amazon) or even a particular industry (retail), they're addressing a more fundamental problem - digital businesses using arbitrage to virtually "move" profits around and minimize corporate income tax - something that's inherent to their business model and creates an (allegedly) unfair advantage.

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

#66

Post by mises »

jorge-d wrote: post #57
aey wrote: post #36

Earlier quoted context omitted.

No matter how the law is written, if the result is that the exceptions only apply to French companies and not to the US, it’s bullshit :). They could pick arbitrary ways to bisect the set until they get the desired result.

Who said it was only targeting US companies? 26 companies fall under the required threshold. Not all of them are US based and there's even a French one (criteo). Here is the full list [1]: • Sales of goods: Alibaba, Amazon, Apple, Ebay, Google, Groupon, Rakuten, Schibsted, Wish, Zalando. • Services: Amadeus, Axel Springer, Booking, Expedia, Match.com, Randstad, Recruit, Sabre, Travelport Worldwide, Tripadvisor, Uber.…

Most of those are still American businesses (twenty of twenty-nine, or over two-thirds). Another interesting way to look at it would be by revenue breakdown - I suspect the total revenue of American companies may be disproportionately high.

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

#67

Post by icebraining »

kzrdude wrote: post #35
alt_f4 wrote: post #25

Trump is right on this one -- this measure is definitely anti-competitive and specifically aimed at American tech companies. I hope he is swift to retaliate with appropriate tariffs. Failing to do so will bring a wave of random EU taxes on American tech companies, which will eventually lead to lower profits and engineer salaries.

Oh no, won't someone please think of the U.S. software.engineers. And oh no, access to a market also means legal and tax responsibilities?

The HN guidelines ask us not to be snarky.

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

#68

Post by liberte82 »

aey wrote: post #36
mywittyname wrote: post #14

Earlier quoted context omitted.

Taxation/regulations can place an undue burden on smaller companies. So I think it's perfectly acceptable to use size as a component of taxation. It's like progressive taxation applied to business.

No matter how the law is written, if the result is that the exceptions only apply to French companies and not to the US, it’s bullshit :). They could pick arbitrary ways to bisect the set until they get the desired result.

Why? Is only the US allowed to practice protectionism?

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

#69

Post by black_puppydog »

bluecalm wrote: post #54
99052882514569 wrote: post #3

Taxing digital companies based on digital presence certainly makes sense to me, as a layperson. A company that's selling ads to a French company that wants to show those ads to French users is doing business in France, end of story. Taxing only very large corporations - that's a little more questionable, but plenty of countries (including the US) treat small businesses preferentially, so it's not like it's unpreceden…

It's really not that simple. They don't use any of the country infrastructure or workers. If I make a video game and sell it to a person in France does it mean I do business in France? It seems to me it should be treated the same as French person coming to my country, buying my game and going back home. We've just skipped on unnecessary traveling. Those things are subject to debate and power struggle but it's clear t…

apart from that they take advantage of there even being people who can be advertised to (i.e. who have the means to buy stuff, to be even worth advertising to) facebook etc certainly make use of the digital infrastructure in place.

I'm writing this via a glass fiber connection supplied by "Orange" (formerly known as France Telecom)

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

#70

Post by mars4rp »

bluecalm wrote: post #54
99052882514569 wrote: post #3

Taxing digital companies based on digital presence certainly makes sense to me, as a layperson. A company that's selling ads to a French company that wants to show those ads to French users is doing business in France, end of story. Taxing only very large corporations - that's a little more questionable, but plenty of countries (including the US) treat small businesses preferentially, so it's not like it's unpreceden…

It's really not that simple. They don't use any of the country infrastructure or workers. If I make a video game and sell it to a person in France does it mean I do business in France? It seems to me it should be treated the same as French person coming to my country, buying my game and going back home. We've just skipped on unnecessary traveling. Those things are subject to debate and power struggle but it's clear t…

it is more like, you are putting your product in their shops and not paying any tax on it!
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