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France Seeking $1.76 Billion In Back Taxes From Google (reuters.com)
An anonymous reader writes: According to a Reuters insider, France is seeking 1.6 billion euros in back taxes from Google, dwarfing what the United Kingdom recently agreed to pay. France apparently has no interest in striking the same 'sweetheart tax' deal that put the UK into a critical light when it revealed that the search giant would pay only 130 million pounds of tax, a $181.18 million settlement, for over 10 years in multi-billion dollar trade in the UK.
https://en.wikipedia.org/wiki/...
in this case silicon valley has been a leech on many of the world's societies. Perhaps silicon valley should actually try paying what it legitimately owes instead of trying to use tax havens to leech off society.
The fine wasn't lowered, that's just the change in the Euro exchange rate.
I know the site has a pretty staunch libertarian lean, but its important to rememember: Google rakes in around 17 billion dollars per quarter.
france wants backtaxes for multiple years totalling ~2% of an entire years revenue.
Good people go to bed earlier.
avoid .... owe ... legal fraud
If you can avoid it, you do not owe it. It is legal. It is not fraud, however unjust you may think it is.
If you owe it, try to hide it, and do not pay it, it's called "Tax Evasion". That's against the law, you don't pay back taxes you pay back taxes and go to jail.
If there is a dispute between what you think you owe, and what the government thinks you owe, it's called a lawsuit. If France wins, google owes back taxes (presumably with interest). If Google wins they still pay nothing.
France is asserting that Google does in fact owe money that Google does not believe it owes. It's a lawsuit. This distinction is incredibly important in many countries, as what these companies are doing is usually LEGAL. It is our own governments that are screwing up in tax law, and our governments that need to fix the problem. Of course the second you talk about "fixing" tax law, you end up with all sorts of barnyard noises in congress (in the US, but I imagine we don't have the market cornered on this). It's easier in this case to wage a war of public opinion (similar to FBI and keys to the city) than to actually try to get these sorts of laws changed against a hostile congress. But, as a people, we need to understand this: the government is complicit. The only reason these lawsuits even happen is that there is debate, there shouldn't be debate.
Also when you go do lawsuit stuff, you always exaggerate your claims. It's part of the game.
>> I will never again eat at Burger King in large part because of their tax inversion
Oddly enough, I stopped eating there because of intestinal inversion.
"France demanded reparations for all their soldiers killed by English bowmen."
England lost more soldiers fighting for France in one day on the Somme (WWI) than the English killed in the whole hundred years war
avoid .... owe ... legal fraud
If you can avoid it, you do not owe it. It is legal. It is not fraud, however unjust you may think it is.
If you owe it, try to hide it, and do not pay it, it's called "Tax Evasion". That's against the law, you don't pay back taxes you pay back taxes and go to jail.
If there is a dispute between what you think you owe, and what the government thinks you owe, it's called a lawsuit. If France wins, google owes back taxes (presumably with interest). If Google wins they still pay nothing.
France is asserting that Google does in fact owe money that Google does not believe it owes. It's a lawsuit. This distinction is incredibly important in many countries, as what these companies are doing is usually LEGAL. It is our own governments that are screwing up in tax law, and our governments that need to fix the problem. Of course the second you talk about "fixing" tax law, you end up with all sorts of barnyard noises in congress (in the US, but I imagine we don't have the market cornered on this). It's easier in this case to wage a war of public opinion (similar to FBI and keys to the city) than to actually try to get these sorts of laws changed against a hostile congress. But, as a people, we need to understand this: the government is complicit. The only reason these lawsuits even happen is that there is debate, there shouldn't be debate.
Also when you go do lawsuit stuff, you always exaggerate your claims. It's part of the game.
I think the problem here is NOT that it is illegal or legal. They are using tricks to evade the laws or go in areas where the laws haven't explicitly forbidden. Companies are actively seeking loopholes in the wording or in international tax treaties, they are then abusing these holes. It may be legal by the letter of the law (or at least not illegal), but it was certainly not the intention of the law to allow it. It is like someone finding a way to steal or kill someone with some new technology and then finding the law doesn't cover it, it is obvious it is wrong and should be illegal but it hasn't been made explicitly illegal so they get away with it.
Your numbers are out more than just a little.... Google took in 74.15 billion in revenue in 2015. France isn't looking for 10% of Google's revenue. They are looking for back taxes over the period in which Google operated in France which looks to have averaged 1.2 billion euro over the past 5 years.
France is seeking 1.6 billion euros in back taxes from Google, dwarfing what the United Kingdom recently agreed to pay.
The UK owed France taxes? What's that got to do with Google?
In most countries the tax laws are the way they are because each nation's government has created loopholes for its own big corporations and businesses. England, for example, has a terrible rate on taxation of its own companies. Rolls-Royce clears £1.1B in profits every year and only pays £2M in taxes. It's just easier for them to point fingers at American corporations and scream in outrage than to admit they are hypocrites. Old news.
http://www.dailymail.co.uk/news/article-2287216/Revealed-One-UKs-companies-pay-tax.html
Meanwhile, the same happens in France. Special benefits for French corporations only. Again, far easier to anger citizens and rally them against the US than admit the truth.
http://www.courthousenews.com/2015/09/02/french-corporate-tax-loophole-ruled-illegal.htm
Please tell me you are joking.
2025, boardroom of a start-up company looking on where to invest, where to find customers, and where to set up offices:
Chris: Hey Jo, I've been looking at our European customer base. We haven't really been targeting them but there seems to be a lot of interest. You think we should look into setting up offices there?
Jo: Really, we should have been doing it earlier. If we don't get a significant percentage of the worlds population using our system we can be too easily displaced.
Chris: You know tax rates are higher there don't you?
Jo: Yeah they are. But if we don't try to avoid taxes in those regions we can easily budget for them. Of course we could do what Google did and walk the grey line and then negotiate hard when they come after us.
Chris: Hmmmm I'll give that some thought. It could be good to have the extra cash early but we will need to budget for settlements and the risk associated with that.
There is NO WAY that an international company will ignore the second largest consumer population block in the world. None. Not a chance. Christ companies bend over backwards to operate in China and the Eurozone is bigger financially in total.
"If you can avoid it, you do not owe it. It is legal. It is not fraud, however unjust you may think it is.
If you owe it, try to hide it, and do not pay it, it's called "Tax Evasion". That's against the law, you don't pay back taxes you pay back taxes and go to jail."
In the US where these terms are routinely applied in this manner the difference is in fact what the IRS says it is with individuals who have exploited tax loopholes often categorized as "Tax Evasion" whether in code or not, since most of the code is ambiguous and at the discretion of the auditor. While large corporations tend to be given the benefit of the doubt.
In fact, many things that are perfectly legal for corporations are explicitly outlawed for individuals. For instance, I know of one massive corporation that would silo off portions of it's operation that cost money, incorporate separately, then charge the original company exactly $1 over costs for services each year. Because that business made $1 instead of taking a multi-year loss it would not trigger any kind of review or audit. As an individual you would be hammered in multiple ways for doing this. For starters because you own more than 60% interest, for another because the entire cost center corporation is not actually intended to generate substantial profit and would be declared a "hobby", for another it evades deduction limits.
On the flip side, incorporated entities that are small really get burned with double taxation. You have to pay tax on the corporations income and then turn around and pay again when the corporation pays income to you. This double taxation is the justification for many of the corporate tax write offs that individuals don't get and they make sense or are even too restrictive to avoid double taxation for these small incorporated businesses while allowing billions in dodged taxes for massive public entities.
"France demanded reparations for all their soldiers killed by English bowmen."
England lost more soldiers fighting for France in one day on the Somme (WWI) than the English killed in the whole hundred years war
As someone who grew up around a family member who parachuted into Normandy I certainly understand the sentiment. However how many of those deaths were due to the incompetence of English generals?
A joke I learned from the old paratrooper:
At the start of a mission briefing an officer asks his men what is the number one killer of paratroopers?
One of the men responds, "sir, its generals, usually your own."
The officer then asks what is the number two killer of paratroopers?
I think the problem here is NOT that it is illegal or legal. They are using tricks to evade the laws or go in areas where the laws haven't explicitly forbidden.
And those tricks and gaps, you think they were accidents? That Google, et. al are the only people who scrutinize tax laws?
I don't believe it for a second. That scrutiny is a prerequisite for the laws to have passed to begin with. The only people who cannot afford that scrutiny are the people being hurt. What has happened is that the general public, not just in France but everywhere, has caught on to this and is crying foul. And so we have this charade.
What is lost when people blame Google or Apple or Microsoft for these things is the message: your government sold you out. The outcome of this is, for the continued peace of France, is they're going to find something Google did wrong and Google is going to pay a nominal sum that sounds big to make it go away. The people will be happy that evil Google had to pay the piper but the laws won't change. Google will continue to pay less than what was intended, and a hundred other multinats will continue doing what they've always done.
Wait, what? Every businessman left France?
Wow, talk about an opportunity! No matter what market I want, I'd have a monopoly! Sure, tax is high, but hey, pass it on to the customer, who gives a shit about taxes?
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
avoid .... owe ... legal fraud
If you can avoid it, you do not owe it. It is legal. It is not fraud, however unjust you may think it is.
If you owe it, try to hide it, and do not pay it, it's called "Tax Evasion". That's against the law, you don't pay back taxes you pay back taxes and go to jail.
If there is a dispute between what you think you owe, and what the government thinks you owe, it's called a lawsuit. If France wins, google owes back taxes (presumably with interest). If Google wins they still pay nothing.
France is asserting that Google does in fact owe money that Google does not believe it owes. It's a lawsuit. This distinction is incredibly important in many countries, as what these companies are doing is usually LEGAL. It is our own governments that are screwing up in tax law, and our governments that need to fix the problem. Of course the second you talk about "fixing" tax law, you end up with all sorts of barnyard noises in congress (in the US, but I imagine we don't have the market cornered on this). It's easier in this case to wage a war of public opinion (similar to FBI and keys to the city) than to actually try to get these sorts of laws changed against a hostile congress. But, as a people, we need to understand this: the government is complicit. The only reason these lawsuits even happen is that there is debate, there shouldn't be debate.
Also when you go do lawsuit stuff, you always exaggerate your claims. It's part of the game.
I think the problem here is NOT that it is illegal or legal. They are using tricks to evade the laws or go in areas where the laws haven't explicitly forbidden. Companies are actively seeking loopholes in the wording or in international tax treaties, they are then abusing these holes. It may be legal by the letter of the law (or at least not illegal), but it was certainly not the intention of the law to allow it. It is like someone finding a way to steal or kill someone with some new technology and then finding the law doesn't cover it, it is obvious it is wrong and should be illegal but it hasn't been made explicitly illegal so they get away with it.
No, the problem is EXACTLY whether it is legal or illegal.
The definition of something being illegal is that there is a law that prohibits that behavior. If there isn't a law against it then it is legal. Argue all you want whether loopholes are just or unjust and whether the use of a loophole for non-intended use is moral or immoral but the point is that poorly crafted tax laws results in the legal reduction in tax burden for companies and rich people who can hire smart tax accountants.
As for your comparison, it's completely stupid. We have laws against murder and theft, full stop. Doesn't matter how you do it or if you use a proxy. The laws even cover being a party or conspiracy to murder. The only loophole, if you want to call it that, for murder is self-defense.
There is no law that says that you have to pay a specific amount of taxes. For example, if there was a law that all companies must pay a minimum of 10% in taxes with no qualifications and Google used loopholes as justification to pay less then your argument would make sense. There is no such law as far as I know.
I agree with you that in a just world corporations would shoulder more of the tax and infrastructure burden than they do. But it's up to us to vote in and lobby people who can change the laws.
Yaay go France. I wish the UK had more balls.
Alternatively maybe I can now "agree to pay" about 100th of my UK tax bill. and If not, why not?
Just wait until the government comes after you for using the "loophole" of only paying what the tax table they provided you claimed you owe.
"What, you used our tax table to pay what we said you owe? Well THERE'S your problem! No wonder you under paid us. Now give us the rest of our money."
As you say, just because the law as written says you must only pay what the tax table says you should be paying, doesn't mean you not paying enough is right or legal.
Just as an aside, my Father was at Dunkirk in 1940 in the BEF and had nothing but praise for the French. Americans joke about them being "Cheese eating surrender monkeys", but if the French 2nd Army hadn't fought on alone and unsupported for 2 days, my Dad probably would have been captured by the Germans, and the War might have been lost right there.
They war almost certainly wouldn't have been lost if you're father had been captured. The war wouldn't have even been lost if *all* of them had been captured. They were the ground soldiers. I guess you could say that the captured wouldn't have been in N. Africa but there were still plenty of troops if you look at the numbers.
To put N. Africa into scale and WWII numbers, the surrendering Germans were something like 225,000 - in pretty much one go. Would it have been tougher? Maybe, but probably not a hell of a lot. The folks from Dunkirk only made up something like 1/8 of the N. African soldiers.
Also, any American who holds such views about France is an idiot. We have our country because of France and some might say that gift cost the leader's heads. If they hold those views, they have no idea about WWII. If they hold those views, they sure as hell know nothing of the French Foreign Legion. I am American, by the way.
"So long and thanks for all the fish."
To be fair we Americans are usually referring to French politicians and "elites" in such jokes, not ordinary citizens. We understand that there is often a great disparity in beliefs and actions between a nation's political/social/economic elites and the ordinary citizen ... whether that nation is France, Russia, China, Iran, etc.
"IF" companies like this payed their fair share of tax the stock market wouldn't look as bloated plus that money would be injected into each countries economies, meaning better education, roads, welfare (not corporate welfare), health care, etc. There really is no excuse for "laws" that allow this type of tax avoidance and is the best thing for any country.
The person you replied to is an Anaco-capitalist. (No, that does not mean Libertarian. They're diametrically opposed views, in all actuality.)
What they said, including the violence, is in-line with their beliefs. If nothing else, they're consistent and you've gotta respect that. They're sincere held beliefs which is a lot better than many have. Don't get me wrong, I think they're insane (but probably not retarded or stupid) and I think that anarchy will never reach the plateau that is assumed. I also think that capitalism doesn't reach a state of equilibrium on its own, much like all pure political or economic ideologies. (Government, like life, finds a way and there will be governance, even if just at the end of a barrel.)
So, yes... Yes I think they're horribly misguided and don't realize the horrible failure their ideology will result in - if implemented (we've seen it on small scales, it seldom works well). But... I do respect their consistency and that they're truly held beliefs - and that they're willing to take the guff that comes along with holding those beliefs. However, trying to reason with them is an exercise in futility.
"So long and thanks for all the fish."
They aren't accidents. Tax laws for the most part were designed when globalisation was just a glimmer in the eyes of most corporations and most large companies were not mobile like they are today, they were written so that companies could legitimately operate across international borders without finding they would be taxed multiple times. today companies can literally be just an office anywhere, especially software companies this allows them to easily jump from country to country and shift costs and profits with ease. This problem simply didn't exist last century (or at least not to any significant degree where it was a problem worth pursuing) and has only really escalated to ridiculous levels in the last 20 years when mobility for a company is simple.
Frenchmen, when led be either a female or non-frenchmen, make perfectly good soldiers. Their is something about the french male however, that when given authority at the rank of General or higher, turns their brains into swiss cheese.
You may think it is plenty. The rest of the world has had a gutful of large companies hiding profits in tax havens to leech money out of countries. The taxes they pay are a tiny fraction of what they should be paying and no this isn't just a google problem.
The English heritage of following letter of law rather than spirit is not followed in all jurisdictions. Fortunately.
In particular, continental Europeans following Roman/civil/whatever-you-wanna-call-it systems will take a very different approach to writing and interpreting rules that make it much harder to say, "But if you think carefully about it, it the words could be construed to mean THIS rather than THAT!" If THAT is obviously what was intended, THIS is you trying to be a smartarse to evade the social contract you entered into when deciding to do business in the country, and nobody gives a fuck.
This is quite confusing to Englishmen and Americans, who regard laws as disconnected from lawmakers - a thoroughly intellectually dishonest position.
Obviously the Royal Navy could still have controlled the Channel, but a negotiated surrender would almost certainly have happened.