G-20 vs Tech Giants (Tax Wars)

[Princess Luna]

G-20 PROMISES MORE EFFORT AT TAXING TECH GIANTS DURING 2019'S JAPAN MEETING.

 

 

Economy ministers and central bank presidents of G-20 member states said on Sunday (9th of June) they would "redouble" their efforts to change taxes paid by global technology giants.

 

Understanding the issue as per article:

 

Facebook, Google, Amazon and other large technology companies face criticism for reducing their tax bills by booking profits in low-tax countries regardless of the location of the end customer. Such practices are seen by many as unfair. The new rules would mean higher tax burdens for large multinational companies but would also make it harder for countries such as Ireland to attract foreign direct investment with the promise of ultra-low corporate tax rates.

 

Big internet companies say they follow tax rules, but they pay little tax in Europe, typically by channeling sales via countries such as Ireland and Luxembourg, which have light-touch tax regimes. Great Britain and France have been among the most vocal proponents of proposals to make it more difficult to shift profits to low-tax jurisdictions, with a minimum corporate tax also in the mix.

 

“The proposals are still a little vague, but they are gradually taking shape.” Japanese Finance Minister Taro Aso, who chaired the G20 meetings, told reporters.

 

“We truly believe that the tech giants, which are not only the GAFA (Google, Amazon, Facebook, Apple) must pay their fair share of tax where they create value and profits.” Pierre Moscovici, the European Union Commissioner for Economic Affairs.

 

Apparently the world is going to tight the leash on the Tech Giants, having the G-20 (Group of the 20 wealthiness nations) joining political forces to find better ways to tax and tribute these companies sure shows there's plenty of money at the table every one's interested in.

 

Do you think Governments are being greedy? Maybe the Tech Giants are the ones wrong doing? Comment below!

 

[samcool55]

They don't need to focus on the tech giants (even tho that's a good place to start imo), they need to get rid of what makes this possible in the first place. The insane low tax rates in countries like Luxembourg and Ireland need to go. That's what needs to happen. If you buy something in let's say Germany, the tax you pay on whatever you buy should end up with the German gov (makes sense?) and that's currently not always the case so i'm all for rules that fixes this.

 

And while a small country on its own can't do much, the G20 can make a difference so i hope they really do change things.

 

[BuckGup]

No I’d rather have Apple the trillion dollar company pay for social security than me $1000 every month until I die and then it will be gone anyways 

[Eniqmatic]

"FUK...U OK?"

[thorhammerz]

1 hour ago, samcool55 said:

They don't need to focus on the tech giants (even tho that's a good place to start imo), they need to get rid of what makes this possible in the first place. The insane low tax rates in countries like Luxembourg and Ireland need to go. That's what needs to happen. If you buy something in let's say Germany, the tax you pay on whatever you buy should end up with the German gov (makes sense?) and that's currently not always the case so i'm all for rules that fixes this.

Practically speaking, that is never going to happen so long as each country in the EU maintains its own budget and banking system (for obvious reason).

 

Good idea in theory (for the wealthier north-eastern states at any rate, not so much for the poorer ones ).

[Thaldor]

1 hour ago, samcool55 said:

They don't need to focus on the tech giants (even tho that's a good place to start imo), they need to get rid of what makes this possible in the first place. The insane low tax rates in countries like Luxembourg and Ireland need to go. That's what needs to happen. If you buy something in let's say Germany, the tax you pay on whatever you buy should end up with the German gov (makes sense?) and that's currently not always the case so i'm all for rules that fixes this.

 

And while a small country on its own can't do much, the G20 can make a difference so i hope they really do change things.

Making Ireland and Luxembourg change their laws and taxation wouldn't change a much because the tech giants would just move their "headquarters" to the next lowest taxation country or even worse, go to countries that don't give a shit (like Malta). With more global rules that would bound every country equally it would be impossible to just move the headquarters.

 

Personally I'm all in for this one. Done enough research on taxation and how much big companies pay taxes and it's more than clear that some global rules must be set so the megacorporations will pay their taxes where they are due. "Creative bookkeeping" is such a curse word that I rather hear 4 year olds run in the streets screaming "fuck" all day long rather than "creative bookkeeping", and it's even worse when everyone knows that "creative bookkeeping" is just a synonym to legal tax evasion.

[samcool55]

4 minutes ago, Thaldor said:

Making Ireland and Luxembourg change their laws and taxation wouldn't change a much because the tech giants would just move their "headquarters" to the next lowest taxation country or even worse, go to countries that don't give a shit (like Malta). With more global rules that would bound every country equally it would be impossible to just move the headquarters.

 

Personally I'm all in for this one. Done enough research on taxation and how much big companies pay taxes and it's more than clear that some global rules must be set so the megacorporations will pay their taxes where they are due. "Creative bookkeeping" is such a curse word that I rather hear 4 year olds run in the streets screaming "fuck" all day long rather than "creative bookkeeping", and it's even worse when everyone knows that "creative bookkeeping" is just a synonym to legal tax evasion.

That's why I'm liking the fact the G20 is trying to make things change and not just a few random countries. They might not be every single country out there, but they do have 80% of the world trade in their hands, I'm sure they come up with something.

 

Creative bookkeeping is indeed disgusting but that's sadly the situation we are in right now. I really hope stuff changes soon.

[Eaglerino]

I wish we all paid zero taxes. That should be G20's effort, lowering the taxes of the world, not raising them

[jagdtigger]

3 hours ago, samcool55 said:

They don't need to focus on the tech giants

Yep, they should watch closely their bank account and log everything. Then this can be used by he tax bureau if they try tho hide their profit....

Edited June 17, 2019 by jagdtigger

[Bananasplit_00]

2 hours ago, Eaglerino said:

I wish we all paid zero taxes. That should be G20's effort, lowering the taxes of the world, not raising them

id much rather not be in debt all my life because i needed to visit the hospital once for a day but hey thats just me and the rest of europe i guess

[Guest]

Well, they aren’t in Ireland for the weather.

[TetraSky]

I'm already fucking paying 15% taxes on most online purchases, be it on Amazon or Steam. The only places I'm not paying taxes so far, is those cheap chinese garbage websites, grey market resellers and ebay... But we don't pay taxes on used goods here in the first place...

 

So if tech giants are screwing the government by not sending them back the collected taxes by pretending to be based in a tax haven, they better get slapped with huge fines.

[mr moose]

6 hours ago, Thaldor said:

Making Ireland and Luxembourg change their laws and taxation wouldn't change a much because the tech giants would just move their "headquarters" to the next lowest taxation country or even worse, go to countries that don't give a shit (like Malta). With more global rules that would bound every country equally it would be impossible to just move the headquarters.

 

Personally I'm all in for this one. Done enough research on taxation and how much big companies pay taxes and it's more than clear that some global rules must be set so the megacorporations will pay their taxes where they are due. "Creative bookkeeping" is such a curse word that I rather hear 4 year olds run in the streets screaming "fuck" all day long rather than "creative bookkeeping", and it's even worse when everyone knows that "creative bookkeeping" is just a synonym to legal tax evasion.

To be honest,  I will not hold it against anyone doing what they can within the law to reduce their financial obligation (I do it too),  I've always said if tax avoidance is a problem then it's up to the governments to change the rules.  In Australia, the Tax office had a big name and shame of companies that weren't paying any tax,  to which my response is "why are you letting them"?  to me it's like complaining people are playing on the grass when there is no rule or sign stopping it.

 

Having said that, it is pleasing to me to see new rules in Australia that say's any sale made in Australia is taxed in Australia.  That means if google charge an Australian company for an ad, they pay tax on that sale.   I haven't read the details yet, but it seems they tax large companies on where the money comes from rather than where it is going. 

 

On a longer more extended projection of the concept, I am personally in favor of a global currency,  With one currency off shore holdings lose all their benefits and there is no where to hide if you try to avoid your obligations.

[Thaldor]

8 minutes ago, mr moose said:

To be honest,  I will not hold it against anyone doing what they can within the law to reduce their financial obligation (I do it too),  I've always said if tax avoidance is a problem then it's up to the governments to change the rules.  In Australia, the Tax office had a big name and shame of companies that weren't paying any tax,  to which my response is "why are you letting them"?  to me it's like complaining people are playing on the grass when there is no rule or sign stopping it.

 

Having said that, it is pleasing to me to see new rules in Australia that say's any sale made in Australia is taxed in Australia.  That means if google charge an Australian company for an ad, they pay tax on that sale.   I haven't read the details yet, but it seems they tax large companies on where the money comes from rather than where it is going. 

 

On a longer more extended projection of the concept, I am personally in favor of a global currency,  With one currency off shore holdings lose all their benefits and there is no where to hide if you try to avoid your obligations.

I find the bigger problem is that single countries aren't allowed or can't tax companies by their real revenues. Like in Finland the corporation taxation is flat rate 20% from revenue, which means multi-nation corporations like Google have some investments just a day before financial year ends and somehow those investments are exactly the same amount as their revenue would be, so in the end they don't have any revenue to be taxed (even if those investments were paid to the parent company).

 

It would be a big change to better if the countries were allowed to tax by the total revenue of the multi-national corporation (like in the case of Google Finland, they would be taxed by some portion of the revenue of Google LLC or better the Google Ireland). Of course there should be safe nets so that companies not doing this creative bookkeeping would be excepted, but that would open huge loopholes.

 

One global currency on the other hand is a one terrible idea. Just look at euro already, it's a huge mess where one single currency has hugely different value in different countries (30€ in Finland is around 3 hours wage, in Latvia that same 30€ is more like days wage or even more (not really sure)), now think when there was a global currency that would include countries like China, US, Norway and Iceland and at the same time African countries with hyperinflation where it's actually cheaper to warm the stove with the money than buy wood. Only whole Europe under one currency would be a mess, currently we talk "only" about average incomes from ~800-2,500€/month within countries using euro, with other geological European countries coming in the difference would be ~250-5,200€/month, you could easily go to work few days in Monaco and live the rest of the year in the Ukraine without working a minute. Now with hyperinflation countries included, work couple of hours in Monaco and live like a rich in Zimbabwe the rest of the year, while in Monaco hour wage would be around 20€/hour in Zimbabwe we would talk something like 0.00001€/hour.

Also making one single currency strong and stable enough to be used would eat tremendous amounts of resources (money). US dollar is quite global currency and almost everything is bound to it and IIRC quite a big bite from yearly new US national debt goes to keep the dollar strong (today US dollar is only by very small portion backed with gold, mostly it's backed by the US bonds) just because if USD was to fall, that would be bad. With global currency we would need to really stabilize it, meaning emptying the gold reserves and backing it with gold and a lot more concrete than debt bonds and for it to succeed it would need to be quite the same valued as USD and EUR or even be more valued and that would be some great magic trick to be seen (IIRC EUR was made stable by both backing it with gold and bonds and also tying it to USD which then looked a lot more stable than today, with global currency you really couldn't bind it to any other currency which would require a lot more backing).

And before someone says it, without backing we get a currency like Bitcoin, basicly deemed to fall because only thing keeping it valued would be how much people are ready to pay for it and when the price gets high enough, people stop paying for it and then the fall starts. Just like some social media stars whole career is build on following and when people loose their interest, well shit happens, good luck trying to get a job with qualifications like "making a duckface" and "having ass implants" [a bit of sarcasm included]

[mr moose]

1 hour ago, Thaldor said:

I find the bigger problem is that single countries aren't allowed or can't tax companies by their real revenues. Like in Finland the corporation taxation is flat rate 20% from revenue, which means multi-nation corporations like Google have some investments just a day before financial year ends and somehow those investments are exactly the same amount as their revenue would be, so in the end they don't have any revenue to be taxed (even if those investments were paid to the parent company).

 

It would be a big change to better if the countries were allowed to tax by the total revenue of the multi-national corporation (like in the case of Google Finland, they would be taxed by some portion of the revenue of Google LLC or better the Google Ireland). Of course there should be safe nets so that companies not doing this creative bookkeeping would be excepted, but that would open huge loopholes.

 

That's where they simply ditch external investment as a tax right off.  If they can no longer write off revenues against international investment, then that can no longer happen.

 

1 hour ago, Thaldor said:

One global currency on the other hand is a one terrible idea. Just look at euro already, it's a huge mess where one single currency has hugely different value in different countries (30€ in Finland is around 3 hours wage, in Latvia that same 30€ is more like days wage or even more (not really sure)), now think when there was a global currency that would include countries like China, US, Norway and Iceland and at the same time African countries with hyperinflation where it's actually cheaper to warm the stove with the money than buy wood. Only whole Europe under one currency would be a mess, currently we talk "only" about average incomes from ~800-2,500€/month within countries using euro, with other geological European countries coming in the difference would be ~250-5,200€/month, you could easily go to work few days in Monaco and live the rest of the year in the Ukraine without working a minute. Now with hyperinflation countries included, work couple of hours in Monaco and live like a rich in Zimbabwe the rest of the year, while in Monaco hour wage would be around 20€/hour in Zimbabwe we would talk something like 0.00001€/hour.

Also making one single currency strong and stable enough to be used would eat tremendous amounts of resources (money). US dollar is quite global currency and almost everything is bound to it and IIRC quite a big bite from yearly new US national debt goes to keep the dollar strong (today US dollar is only by very small portion backed with gold, mostly it's backed by the US bonds) just because if USD was to fall, that would be bad. With global currency we would need to really stabilize it, meaning emptying the gold reserves and backing it with gold and a lot more concrete than debt bonds and for it to succeed it would need to be quite the same valued as USD and EUR or even be more valued and that would be some great magic trick to be seen (IIRC EUR was made stable by both backing it with gold and bonds and also tying it to USD which then looked a lot more stable than today, with global currency you really couldn't bind it to any other currency which would require a lot more backing).

And before someone says it, without backing we get a currency like Bitcoin, basicly deemed to fall because only thing keeping it valued would be how much people are ready to pay for it and when the price gets high enough, people stop paying for it and then the fall starts. Just like some social media stars whole career is build on following and when people loose their interest, well shit happens, good luck trying to get a job with qualifications like "making a duckface" and "having ass implants" [a bit of sarcasm included]

One global currency in my mind means the value is the same the world around, without variance you don't have imbalance between nations with everything and nations with nothing.  it would be like more like the US with individual states but a single currency than like the EU which has the eu currency and individual states with individual economies as well.

[Arika]

while we're at it, can we start taxing churches as well?

[Zodiark1593]

11 hours ago, huilun02 said:

If I were a leader who truly cared about rightful treatment of tech giants' activities in my country, I would simply argue that if they made no taxable income, it should not hurt their business at all to have every ISP direct the tech giants' servers and services to 127.0.0.1

 

Oh you say you make no profit here? Piss off then

Would be impacting a great many consumers however.

 

Hard to stay in office if the measures you pass end up indirectly pissing off your civilians, given how much influence the Great Four tech giants have.

 

I suppose smaller tech/software developer businesses that rely on the services of those giants would be "Collateral Damage", as well as whatever other pies they've stuck their hands into, given their diversification borders on Megacorporate status.

[thorhammerz]

7 hours ago, Thaldor said:

One global currency on the other hand is a one terrible idea. Just look at euro already, it's a huge mess where one single currency has hugely different value in different countries (30€ in Finland is around 3 hours wage, in Latvia that same 30€ is more like days wage or even more (not really sure)), 

Hey, it's made Germany's export-driven economy tremendously successful (the value of the Euro gets tanked from all the central & southern European countries in the mix), and France almost equally happy (all that revenue helps funds their domestic subsidies).

 

All for the low, low, low cost of gutting the industries of the poorer southern/central members (if people think Greece was bad, wait till Italy implodes - grab the popcorn for the fireworks) .

Quote

Also making one single currency strong and stable enough to be used would eat tremendous amounts of resources (money). US dollar is quite global currency and almost everything is bound to it and IIRC quite a big bite from yearly new US national debt goes to keep the dollar strong (today US dollar is only by very small portion backed with gold, mostly it's backed by the US bonds) just because if USD was to fall, that would be bad.

The thing about the USD though... there's really no alternatives to it. There's simply not enough of anything else (that people would actually want to hold) to lubricate the global economy.

 

Nobody bases their currency off Gold anymore - there's just not enough of it to go around. You'd have the same thing happen within a decade or two with Bitcoin should it become the backer of any currency - there's not quite enough BTC to back the amount of capital needed to lubricate the contemporary economy.

[Misanthrope]

13 hours ago, Thaldor said:

Making Ireland and Luxembourg change their laws and taxation wouldn't change a much because the tech giants would just move their "headquarters" to the next lowest taxation country or even worse, go to countries that don't give a shit (like Malta). With more global rules that would bound every country equally it would be impossible to just move the headquarters.

 

Personally I'm all in for this one. Done enough research on taxation and how much big companies pay taxes and it's more than clear that some global rules must be set so the megacorporations will pay their taxes where they are due. "Creative bookkeeping" is such a curse word that I rather hear 4 year olds run in the streets screaming "fuck" all day long rather than "creative bookkeeping", and it's even worse when everyone knows that "creative bookkeeping" is just a synonym to legal tax evasion.

Less options for tax avoidance is still better than more options for it. Establishing a shadow office in Malta might work to avoid bulk of the taxes but it isn't cheap to constantly on the move.

[Trik'Stari]

I would agree that governments are generally greedy and incompetent.

 

At the same time I would say that these giant tech companies are far, far larger than they should ever have been allowed to become.

 

How we fix it is.... difficult to say the least.

[PLME888]

On 6/17/2019 at 10:42 PM, TetraSky said:

15% taxes

pff, you think 15% is a lot? try 21% here... 
Cries in mandatory healthcare that i also need to pay for...

[mr moose]

3 minutes ago, PLME888 said:

pff, you think 15% is a lot? try 21% here... 
Cries in mandatory healthcare that i also need to pay for...

I used to be concerned about paying for other peoples health, then I realised the net benefit to me is actually quite huge.   Sick people don't get sicker because health care is free, therefore they are back at work quicker which means production stays up and so does my wage and job security.

 

[TetraSky]

1 hour ago, mr moose said:

I used to be concerned about paying for other peoples health, then I realised the net benefit to me is actually quite huge.   Sick people don't get sicker because health care is free, therefore they are back at work quicker which means production stays up and so does my wage and job security.

 

I personally just like being able to go see a doctor when I'm sick instead of toughing it up until it's too late and not leave his office with a crippling debt that will take me years to pay back.

[mr moose]

1 minute ago, TetraSky said:

I personally just like being able to go see a doctor when I'm sick instead of toughing it up until it's too late and not leave his office with a crippling debt that will take me years to pay back.

I have had a blessed life, the worst I've had up until 3 years ago was a few stitches and a week off work.   Then all of sudden I need a knee reco, open Rhinoplasty and back surgery.  ($60K plus of surgery and no work to pay for it).  Public system means I am contributing to society again in a very meaningful way, not homeless or burdening other people asking for handouts.