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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.
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.
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.
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.
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.
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.
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.
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.