Three European Countries Block Tax On Tech Giants (bloomberg.com) 56
An anonymous reader quotes a report from Bloomberg: French Finance Minister Bruno Le Maire's efforts to rally his European Union colleagues around a new tax on tech giants fell short, as countries skeptical of the plan doubled down on their opposition, and others, including Italy, said they'll push ahead with their own plans. Ministers from Denmark, Ireland and Sweden said they couldn't support the tax in its current form, casting doubt on the proposal's future, since unanimity is required to pass taxes in the EU. The plan on the table would impose a 3 percent levy on the European sales of the likes of Amazon and Facebook. A number of countries are already imposing taxes of their own, increasing the risk of fragmentation in the single market. Finance Minister Giovanni Tria said an Italian tax will kick in next year if there's no broader agreement by then. Spain and the U.K. have already announced their own levies.
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Re:sounds like the voice of reason (Score:4, Insightful)
Let me get this right ... before they were making X and now they'll be making 0.97 X. But they'd rather have 0 X?
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The company moves most of its key employees and tech jobs to the United States, leaving behind a skeleton sales crew to collect sales.
Uhm, that isn't how it works today.
The skeleton crew is currently located in the tax haven. The workforce is where they can pay the lowest wages which is somewhere else.
At the moment the skeleton crew is in Ireland since that minimizes taxes while still being in EU.
Ireland benefits from this since while the taxes are absurdly low they are still paid in Ireland.
By harmonizing the taxes all over EU there is no real benefit for companies to place their paper HQ on Ireland, but they can't move it out of EU if t
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Where the jobs are has been, is and will continue to be entirely fucking irrelevant.
Where the revenues are generated and profits made is the key factor and companies are generating a lot of revenue and profit in the UK then using international tax laws to pay pitiful levels of tax there. That's why the UK is stating that this is not an acceptable way to operate and that an additional tax will now be levied.
Lets face it, Twitter and Facebook don't exactly have high UK employment to start with.
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With the exception of Amazon they do not create jobs on Europe anyway. And Amazon jobs are pretty shitty minimum wage jobs.
So you've got no money passed down to workers that could redistribute it in the local economy means that the local markets don't benefit from it. This also means no income tax from workers means that the governments don't get their cut, which they can put back into the social security systems.
You shouldn't be surprised that such
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If Amazon, Facebook and Apple decide not to operate in the UK then their tax burden in the country will indeed be zero.
Right now they do operate in the UK, they just don't pay a sensible or reasonable level of tax on the profits they make here. I think pay up or fuck off is a perfectly acceptable demand from the Government.
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This arena never existed before. Politicians don't want to tax it to balance the budget. They want to tax it to have another wad to spend and then apppend the current borrowing on top of it.
The rhetoric will remain the same, which is that, in spite of times being better than ever before, the dire needs of The People are more severe than ever before.
Re:What? (Score:4, Insightful)
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"If there are tech giant employees in your country, then you likely tax their income."
Nope that is exactly the problem this suggestion tries to solve*. The company only pay income tax in the country of origin. So even if a company from Ireland(Google for example) sell stuff in other eu countries, all their income tax is paid in Ireland.
*It's still a horrible solution, but I do at least understand why the current system is problematic.
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If there are tech giant employees in your country, then you likely tax their income.
Nope that is exactly the problem this suggestion tries to solve*. The company only pay income tax in the country of origin. So even if a company from Ireland(Google for example) sell stuff in other eu countries, all their income tax is paid in Ireland.
So if I moved to Germany and worked for Google, I wouldn't have to pay any income tax at all to Germany? It's all paid to Ireland even though I don't live or work there?
That just sounds *very* different to me.
Here in the US we have to pay tax to the federal government and to both states, the one you reside in and the one you work in.
Some states have agreements with others, usually near by intended for people that are close to the borders.
In those cases you just pay the state you live in the full amount, an
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That's tax on your income, not Google's.
Of course, that was the question asked and being answered.
If there are tech giant employees in your country, then you likely tax their income.
That's why I questioned the answer given, as it didn't make sense.
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Long story short, in EU you can choose to pay income tax either in your country of residence or registration country of your company. Social security tax is the one which must be paid in country of residence.
Interesting, thank you for that explanation.
Put that way it doesn't sound all too different from here then, other than the usual location type swaps (fed to eu, state to country)
I got the impression it was always income tax paid to the country the company is in.
But of course no government could stand to have taxes be so simple!
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And if product sales occur within your country, then that is also taxed.
which is why they book all the sales throug Ireland regardless of where the sale is made in some absolute sense.
But this new tax isn't about that. Instead it's about taxing the companies no matter where they are located.
Yep!
High tax countries are upset that large tech companies have avoided them
No, this is 100% false. The large tech companies are not avoiding the "high tax" countries at all. They're doing tons of business there and ma
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Actually, these are all examples of taxing you. Bad habits don't pay taxes. Those that engage in them do. As far as the tech giants, its the owners, workers and customers that are paying the tax. The concept that we call a tech giant, or actually any corporation, can move* at the drop of a hat.
*Which brings up an interesting question. How does a corporation like Apple move the 'nexus' for business receipts from the USA to Ireland? If I move any sort of money, property or security across the US border (in e
Some in the EU understand (Score:4, Interesting)
Tax needs a captive product/service that has to stay in that nation.
Low taxation is what attracted US brands to parts of the EU.
When the EU places new tax the same US brands will just look for better tax rates globally.
When the only attractive offer to stay in a nation was a low tax rate, don't remove the one thing keeping a brand in your nation.
Re:Some in the EU understand (Score:5, Interesting)
There are two reasons tech companies won't move out of the EU. One is the educated workforce, and the other is the data that has to stay on EU soil.
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Move to another advanced nation with better workers and a tax rate that welcomes investment and jobs.
How much more tax are an average advanced nations "educated workforce" really worth?
Some of the profits? Most of the profits? A total loss of all profit in that nation just to keep the "educated workforce" ?
Would a company seeking low taxes to get the maxi
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That kind of nationalisation AC?
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"all the profits are lost" :-D
You really struggled with maths in school didn't you?
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Replace non EU services products with EU only services and then force all EU users to enjoy EU taxed services.
The US brands offer a user account for "free".
A EU service has to pay to protect the data in the EU and pay a EU service tax? Thats not "free".
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You can't move selling stuff to EU citizens to outside of the EU.
Sure, you could have your headquarters on the Bahamas or something, but if you want to sell something you pay for that privilege either via import taxes or via taxes of your local branch.
> When the only attractive offer to stay in a nation was a low tax rate, don't remove the one thing keeping a brand in your nation.
Bullshit. The only reason you normally don't do that is because companies can then go somewhere else with lower taxes. Good l
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I fear the person to whom you replied doesn't even understand the issue, and is thus entirely incapable of comprehending the implications of the European response to it.
Hopefully your response will educate them.
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France irked by small nimble countries. (Score:1)
Different small countries in Europe have always had to have different ways of making a living or find themselves feeder economies to the bigger countries. The EU has provided them with a fairer playing field or at least opportunities to take advantage of opportunities. The tech giants have exploited the entire world's inability to keep up with their fancy tax minimisation schemes. Some of the smaller countries have exploited the resulting anomalies as opportunities.
France has long harboured the desire to