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US blocks crackdown on tax avoidance by net firms like Google and Amazon

guardian.co.uk

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Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#81

Post by foobarbazqux »

gsb wrote: post #25
foobarbazqux wrote: post #11

Earlier quoted context omitted.

It's not dual taxation. The IRS deducts the foreign tax paid. So if the foreign country has a higher tax rate, you will never pay US tax. I'm not saying it's a great policy, but it isn't as bad as it sounds. You can always renounce your US citizenship - think of it as a maintenance fee. Yes, draconian.

There are also different treatments of capital gains, and phantom gains which arise only from shifts in exchange rates. For anyone of any means beyond their salary alone these both can lead to paying more combined tax to both countries than either would require individually. Thats dual taxation in my book. Phantom gains have been particularly bad in the last decade with the falling US dollar. In Australia, house pric…

I didn't realize this part, thanks.

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#82

Post by justincormack »

edoloughlin wrote: post #61
justincormack wrote: post #48

Earlier quoted context omitted.

Google does not pay tax in Ireland either, even at low Irish rates. So while it is great that it employs people there and it might anyway, Ireland is integral to its tax evasion strategy, as is the Netherlands.

It doesn't pay very much (corporation tax), but it does pay: http://www.irishtimes.com/business/economy/ireland/google-de... - it took me 3 seconds to find this.

Sorry I didn't mean none but nowhere near what you would expect given this is the entire revenue from Europe.

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#83

Post by simonh »

priteau wrote: post #42
simonh wrote: post #32

Earlier quoted context omitted.

It's not as simple as that. Suppose I run a company based in France employing 100 people and selling goods by mail order. All my operations are in France, so clearly I should pay my taxes in France. The only economic activity that occurs when I sell to someone in the UK is the postage delivery at the UK end. Your proposition is that I should pay UK taxes, but clearly I should definitely pay French taxes. So which do…

It's definitively not as simple as your example. Both Amazon and Google have staff and infrastructure in UK and other European countries. Yet they channel all their profit to lower tax countries (Luxembourg for Amazon and Ireland for Google). In the case of Amazon, when some sales staff is in the UK (evidence coming from whistleblowers, for instance http://www.guardian.co.uk/technology/2013/may/16/amazon-whis... ), w…

Of course what they're doing isn't as simple as my example. The point is you have to construct robust, enforceable and fair rules on an international basis that catch out Google et al on the one hand BUT also don't affect companies like the one I describe. The handwavey comments along the lines of "Just make them pay tax where they sell their stuff" like the one I relied to are less than helpful in this regard.

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#84

Post by Gmo »

forgottenpaswrd wrote: post #6

It talks about France. France is a machine of expending money right now, better said, of wasting money. I am living in France this Summer, a very rich and beautiful country with a hole in the pocket. French people love to life well, and someone else to pay the bills, the Germans, the rich, whoever but not them. Mr Hollande only want to do one thing, to raise taxes. But there is never enough money when you don't expen…

What a full load of BS.

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#85

Post by patrickaljord »

Nursie wrote: post #65
patrickaljord wrote: post #52

Earlier quoted context omitted.

> Even though their activities directly increase your own tax bill. You have an odd way of thinking. The French State creates € 12 billions in debt each month [1]. If you think them paying any more taxes would decrease my tax bill in any way, then you have an odd way of doing math. 1: http://www.planetoscope.com/comptes-publics/315-compteur-de-... > Of course it would, their tax avoidance games mean nobody else can c…

>> If you think them paying any more taxes would decrease my tax bill in any way, then you have an odd way of doing math. Them paying more would either relieve the burden on other parts of society, slow down the debt accumulation (even just a little bit), or allow the government to spend more on public services. All of these three have an impact on your life. If you think it would have no effect at all then you have…

>> Them paying more would either relieve the burden on other parts of society, slow down the debt accumulation (even just a little bit), or allow the government to spend more on public services.

But this is exactly what I'm saying, the more taxes we pay, the more the government spends and create debt. The only way out of this vicious circle is _less_ spending, not more tax. We've been doing more taxes for 60 years and we have more debts than ever.

> Are you seriously saying that the reason Google has no competition in France is because they pay less taxes?

>> Maybe, who knows?

Ok, you're just not being honest right now just to win the argument. Or you're delusional.

>> This is a pipe dream, and any flat tax I've ever seen proposed is highly regressive, loading the burden onto the middle classes

I don't know in what world you live in, but here in France, the burden is already on the middle class. The rich are all domiciled outside of France where they pay much less (around 10 to 15%). A low flat tax around 10 to 15% would bring them back as they would have no interest in going abroad. Many countries have a flat tax http://en.wikipedia.org/wiki/Flat_tax#Countries_that_have_fl...

>> Yes, but you seem to be supporting your own country getting screwed by large corporations and transferring that burden to yourself, French companies and French citizens.

No, I think you are. By setting too high taxes, you make the rich run away and pay their taxes elsewhere, leaving the burden on the middle class who's dying.

>> It's not quite that simple unfortunately.

It is actually. Just not in the interest of the current governments (both left and right are socialist in France).

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#86

Post by flyinRyan »

foobarbazqux wrote: post #80
flyinRyan wrote: post #66

Earlier quoted context omitted.

>So if the foreign country has a higher tax rate, you will never pay US tax. If I live and work completely in a foreign country why would I ever pay US income tax under any circumstances at all? The US is one of two countries on this planet that expect people who's only tie is being a citizen (perhaps never having set foot there and not speaking the language) to file income tax and potentially pay a portion of their…

Yeah, I was only challenging the dual taxation claim. I agree that the rest is draconian. Out of curiosity, what is the other country?

I can never remember. I thought it was North Korea but lately I heard it was somewhere in Africa. I only know the US is one of two places and the other isn't part of the developed world so it's not the best company to be keeping.

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#87

Post by Nursie »

patrickaljord wrote: post #85
Nursie wrote: post #65

Earlier quoted context omitted.

>> If you think them paying any more taxes would decrease my tax bill in any way, then you have an odd way of doing math. Them paying more would either relieve the burden on other parts of society, slow down the debt accumulation (even just a little bit), or allow the government to spend more on public services. All of these three have an impact on your life. If you think it would have no effect at all then you have…

>> Them paying more would either relieve the burden on other parts of society, slow down the debt accumulation (even just a little bit), or allow the government to spend more on public services. But this is exactly what I'm saying, the more taxes we pay, the more the government spends and create debt. The only way out of this vicious circle is _less_ spending, not more tax. We've been doing more taxes for 60 years an…

>> But this is exactly what I'm saying, the more taxes we pay, the more the government spends and create debt.

I'm not sure there's a causal relationship there.

>>The only way out of this vicious circle is _less_ spending, not more tax. We've been doing more taxes for 60 years and we have more debts than ever.

Lower taxes all round is a fine idea. Letting some multinationals off from their tax bill is not a step in the right direction to achieving it.

>> Ok, you're just not being honest right now just to win the argument. Or you're delusional.

I'm being totally honest, the effective tax breaks given to multinationals via their various international financial games are a market distortion that disadvantages smaller players and breaks competition.

>> I don't know in what world you live in, but here in France, the burden is already on the middle class. The rich are all domiciled outside of France where they pay much less (around 10 to 15%). A low flat tax around 10 to 15% would bring them back as they would have no interest in going abroad. Many countries have a flat tax

That list isn't a particularly prestigious club...

Many would say that they should stay abroad if they're not willing to pay to be part of the society we're creating in the west.

As a counterpoint, most people seem to agree that some small percentage of earners pay over half of income tax in most western countries anyway (the threat of rich flight is always used as an excuse not to raise taxes further). Any flat tax that brought in the same amount of money as the present system would relieve this burden from them. Any flat tax that didn't bring in the same amount of money is pointless to argue about because we could reduce the overall tax take in any of a huge number of ways.

Whether the absent rich would return in sufficient numbers to make any impact at all is really a matter of speculation.

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#88

Post by camus »

adventured wrote: post #53
camus wrote: post #10

Earlier quoted context omitted.

You should go back to where ever you come from or wherever it is better for you to live. Sarkozy ruined France so yes now everbody needs to pay for it. And the problem is not taxes,i'm happy to pay taxes. The problem is people like French liberals ( liberals are "right-wing" in France ) that gives hand outs to their friends or vote laws without financing their them , and then all they have left is blaming the poor,th…

If by solidarity you mean the state slavery of collectivism, then you're absolutely right, Americans are often very individualistic. If you by solidarity you mean there's no sense of nation, then you're just making it all up as you go along. However, trying to pigeonhole the most diverse country in world history on such a simplistic basis, is impossible. Only someone that has never spent much time in the countless cu…

I spend a few years in USA. Yes USA is quite diverse , from Maine to California , but that was not my point ( i studied in CS Maine and in Massachusets ).

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#89

Post by gsb »

foobarbazqux wrote: post #80
flyinRyan wrote: post #66

Earlier quoted context omitted.

>So if the foreign country has a higher tax rate, you will never pay US tax. If I live and work completely in a foreign country why would I ever pay US income tax under any circumstances at all? The US is one of two countries on this planet that expect people who's only tie is being a citizen (perhaps never having set foot there and not speaking the language) to file income tax and potentially pay a portion of their…

Yeah, I was only challenging the dual taxation claim. I agree that the rest is draconian. Out of curiosity, what is the other country?

Eritrea.

Re: US blocks crackdown on tax avoidance by net firms like Google and Amazon

#90

Post by patrickaljord »

danmaz74 wrote: post #63
patrickaljord wrote: post #57

Earlier quoted context omitted.

But there is a clear causation here. In order to keep increasing spending forever as they are doing, govs need tax revenue, the more money they are allowed to borrow, the more debt they can create. They couldn't create so much debt if they didn't have tax revenue to justify their ability to repay their debt. Problem is, at some point, if you want to keep on increasing spending and therefor your debt forever, you have…

Come on, no serious economist gives credit to Laffer's curve - until taxation goes over something like 70%. And it's incredibly easy to demystify: Just try to check how many times taxes were increased, and fiscal revenues increased. If we were on the descending slope of that curve, increasing taxes would decrease fiscal revenue.

Check the news, in France we've just reach this point. This year the State is getting a decrease in tax revenue despite a tax increase. Heh, at least they would have accomplished something useful: they proved an old theory right!
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