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EU Unveils Plan To Force Facebook, Google and Amazon To Pay Their Fair Share of Tax (independent.co.uk)
An anonymous reader quotes a report from The Independent: The European Commission is bringing forward plans to make major multinationals such as Google, Amazon and Facebook disclose exactly where and how much tax they pay across the continent. The plan was expected to include rules requiring businesses earning more than 600 million euros a year (nearly $700 USD) to open up their tax affairs to public scrutiny, revealing their profits and accounts in every country in which they operate within the EU. Since the Panama Papers, a new clause has reportedly been added to require the companies to say how much money they make in so-called "tax havens." A final, more general statement would reveal profits in the rest of the world, treated as a single item. The plans will be presented by Britain's EU Commissioner, Lord Hill, who told the BBC: "This is a carefully thought through but ambitious proposal for more transparency on tax. While our proposal on [country-by-country reporting] is not of course focused principally on the response to the Panama Papers, there is an important connection between our continuing work on tax transparency and tax havens that we are building into the proposal."
The plan was expected to include rules requiring businesses earning more than 600 million euros a year (nearly $700 USD) to open up their tax affairs to public scrutiny, revealing their profits and accounts in every country in which they operate within the EU
Wow, that's quite an exchange rate.
The headline is completely and utterly unrelated to the summary.
One is about paying taxes, the other about disclosing taxes. Whoever posted this garbage needs to be subjected to disciplinary action.
Seriously, euros, stick to what you people do better: murder people by the millions, cover up crimes and make all sort of perverted porn stuff. This is, and always has been, all that euros have been good at. Keep doing that. Within your borders of course.
These companies have a fiduciary duty to their shareholders to increase shareholder value, not to bail out the 4th Reich.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
There is this fallacious, persistent belief that if somehow the EU could get hold of more money, all their problems would be solved. This is not the case. When a government, at any level from local to supra-national, gets more money, what happens? They blow it immediately on stupid crap, or use it to fortify their own power. Then, the money is gone and it will never come back. However now that they are used to the higher income level, the quest for more money begins anew.
There is a wonderful short story, called The Rocking Horse Winner, about just this situation. I urge all of you to read it, it's only 5-10 minutes and is well worth the time. More money doesn't fix anything, it just generates demand for even more money.
Shutting down free speech with violence isn't fighting fascism. It IS fascism!
I find it quite the irony that the British commissioner is in charge of this proposal.
The term 'Offshore' for banking is a very British institution referring to their Crown dependencies on smaller islands, be it on the Channel Islands or in the Caribbean.
In 1978 when I started working internationally all British engineers had such an Offshore Account and it wasn't because they wanted their bank manager to live in nicer weather.
Let's see if there is another howl in Westminster about Brussels interfering in their national interests.
A lot of the problems could have been fixed by the British parliament years ago.
"The likes of Facebook and WhatsApp are free to those whose privacy is of zero value."
Why is this a duty. Where did it "maximize" profit for shareholders come from? By that logic, should they sell drugs too? If you take the benefits of a safe modern society, you need to pay your fair share
Punish the wealth creators, and they'll stop creating wealth.
--
roman_mir
They normally do not care even the slightest, but the panama buggery made them pull of this stunt just to save face.
It is a thing we'd wish happen, but much like everything else, the reality is set by the backroom deals and agreements.
i expect nothing to change.
If we can have lists of "rogue nations" and "terrorist organisations" that it is illegal to deal with, then there's no reason why we can't also have lists of "rogue tax-haven nations" (like British Virgin Islands) and "tax-evasion organisations" (like Mossack Fonseca) that it is also illegal to deal with.
It should be a serious crime with huge penalties (both monetary and gaol time) to negotiate with or transact business with any government, company or organisation in one of the listed countries, or to own, operate or conduct business with any listed entity in the organisations list.
That would solve the problem at its source.
And before anyone says that Mossack Fonseca is a legal company that provides other services than just setup of shell companies and tax evasion, the same is true of Hamas. They are a huge humanitarian organisation in the Middle East, providing financial and medical aid and other services to those who need it. Unfortunately, they also have a nutcase terrorist militant wing - this gets them listed as a terrorist organisation and no amount of humanitarian work by the majority non-terrorist parts of Hamas will ever get them off that list.
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And yes, it might become more difficult for them to hoodwink their (EU) state tax office when they have to disclose what they earn and how much tax they pay in which other EU state.
In the US you can't avoid the IRS either by clever apportionment of your business between Vermont, Wisconsin and Hawaii. You're free however to pack up in one state if you think you're better off in another state for tax reasons.
In that way, state taxes simply become a factor in location choice, along with all the others. I fail to see the problem with that.
who cares what the crown royals are dastarding about anymore... https://www.youtube.com/results?search_query=native+peace+spirit
Why would EU want multinational giants like Google to have full disclosure of their tax evasion strategies when they have absolutely no intention to hide it? Their tax evasion strategies are commonly known as "Double Irish, Dutch Sandwich", which could easily be found in modern textbooks.
Ultimately the corporate taxes are waived in Bermuda (aka. Bermuda Black Hole), I wondered how EU was supposed to regulate it?
Why doesn't this apply to everyone? So people/companies making less than 600milion can still hide money. It just became a good idea to have multiple companies instead of 1 big one. Just wait, Mercedes Benz will now be 2 different companies, each with the same share holders, each with exclusive contracts to each other, but both making less than 600 million.
So now that it's the run-up to the EU exit referendum in the UK, the Google search engine will be modified so that any "should UK leave the EU" search will simply return "Yes, because we want to keep our tax situation secret in the UK".
I keep hearing about the various governments being out this number of billions or that number of billions. But where I see the big problem is competition. How can local companies compete with these non-tax paying companies when they are forced to pay taxes.
Capitalism is quite simply the reinvestment in the means of production. With tech companies this can be a complicated relationship with both reinvesting in the actual product, and having the cash available to go around buying out similar companies. Another layer in that involves both issuing new shares to buy companies, and issuing shares to attract investors.
As an example, if a local UK company wants to compete with Google in the ad space in the UK, they will end up paying full taxes on any profits; while google won't. Thus google will be able to return a higher profit to their investors, have more cash to buy out competitors, and will be able to issue more valuable shares as part of those buyouts. The UK company will simply have much of its value continuously eroded by taxes that are annually removed from its balance.
Obviously using google as a comparison to some little ad company is a bit unbalanced, but the same applies to any homegrown company that legally exists only in the European country. Cutting edge drones, robotics, 3D printing, or pretty much anything along those lines will not be able to match the growth curve of a company paying a tiny fraction in taxes.
Those sort of companies that could otherwise become international players are what drives a country's economy. To allow certain countries to always have the upper hand is just going to be a long term bad plan.
So I wouldn't be so much worrying about the handful of missing billions but the long term missing trillions.
So quite simply, make sure that these international companies are under the exact same tax burden as a local company when it involves any business within Europe.
So if a local company were to make an apple priced smart phone and would end up paying $80 in taxes. Make sure that Apple selling the same phone is paying $80 in taxes regardless of what paper shenanigans they try.
It'd be interesting to know who was the first, among Google, FB and AZ, to build a clever financial scheme in order to - legally (that's why the law is being changed) - pay less taxes. My money would go on Google being the smartest, the other would have simply copy-pasted.
Slashdot, fix the reply notifications... You won't get away with it...
When you use terms like "fair share" in a headline, you are taking an editorial stance.
600 million Euros equals 700 USD? Wow, the Euro sure isn't what it used to be.
Why is the EU requiring the companies to disclose tax info paid to EU members..why dont they just require the EU members to provide them with that information?
"It's just obvious you can't have free immigration and a welfare state"
a new clause has reportedly been added to require the companies to say how much money they make in so-called "tax havens."
Proving once again that politicians have zero understanding about how a "tax haven" actually works. I can't really declare income on money that doesn't belong to me anymore...
Seven puppies were harmed during the making of this post.
Is almost $700 US?! Wow, when did the euro become so cheap?
...is not a crime. The logical reaction to our current 'hot mess' of tax regulation is to simplify the tax code, not heap another layer of regulations on top of it.
Companies should pay tax in all locations in which they operate. If they gross some amount across 2 countries, and they're earnings are split 60/40 between countries A and B, then they should be taxed on 60% of their earnings at country A's tax rates and 40% at country B's tax rate. If any money is shifted between country A and B within the company, then it should be taxed leaving country A at their tax rate, and entering country B at their tax rate. This might reduce the advantage for countries with lower tax rates.
but... I'm thinking this is how the tax system already works and no matter how it's setup, the rich will find a way around it.
http://github.com/gbook/nidb
When it comes to taxes, those who throw the phrase "fair share" around interpret it as more, more, always more, more, and a hell of a lot more.
Fine no tax then no fire / free ambulance / cops / etc.
Now it's not fair to the workers to cut them off from the ambulance so if need we bill your office for that cost if needed. And if it's a night and some one beakers in we are not sending the cops to help you.
Isn't Ireland (Eire) in the EU ?
They must have low taxes or why would so many US companies movr their KQ there...
These companies are *not* doing anything illegal, and it's not like we don't know what they're doing. The EU brought this on themselves. When you write laws that let people screw you, you're going to get screwed. Quit blaming the companies for doing legal tax avoidance, and fix the tax laws instead.
We want to enrich our cronies even more. We don't care about you, we only care about ourselves and our cronies.
MORE MONEY FOR CRONIES!
It's not Facebook or Google. It's Facebook-UK or Google-Italy. Each can report their income and expenses within the jurisdiction that they operate. Usually this is an individual country. Those expenses can include interest, franchise, management, licensing and other fees paid to the parent corporation. If this parent corporation resides outside that taxing jurisdiction, good luck getting any continent-wide or global information out. The subsidiary doesn't have access to it and the local taxing authorities can't touch the parent.
Have gnu, will travel.
>> 600 million euros a year (nearly $700 USD)
I wish. I could retire on the change in my pocket.
Since the Panama Papers, a new clause has reportedly been added to require the companies to say how much money they make in so-called "tax havens."
To pretty much every country, every other country charging a lower corporate tax rate is a "tax haven". Why don't they just come out and state they want to tax earnings made overseas since other countries are somehow able to charge lower tax rates, and that's "not fair"...
Heck, let's just jack everyone up to the level of the US, near 47% just to make it fair worldwide...
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
Considering what's coming out in the papers I think the first thing should be is to publish the finances of the politicians and make sure that they are paying their "fair share" of taxes. The companies are doing what they are legally allowed to do. They have to minimize the tax they pay or else the shareholders will either sue or have the members of the board removed. While we may not like it and think that they should be paying more taxes the solution to the problem is for the politicians is to change tax law so that the ways to write off expenses are no longer valid.
Of course by closing the offshore tax havens then the politicians would have to pay more tax themselves and they wouldn't want that.
Financial corporations use the same tax havens as tech corporations, yet they are not to be forced to pay their fair share of tax.
captcha: shorting
You're trying to be sarcastic, but that actually sounds like an excellent deal for the company. Private 24-hour security guards and firefighters would cost them significantly less than the taxes they currently pay, while providing better service. However, I'm not sure why you think you ought to send the worker's ambulance bill to the office; their home address would be a more reasonable and customary choice, unless the company has some special arrangement with the hospital on behalf of its employees.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
send a doctor bill to the workers their home address? in the EU?? the government covers that and they can just make the non tax payers cover the that bill at the full charge master price.
The solution? One global taxing authority. Which means you need some manner of deciding who gets what from whom and, probably, some muscle to enforce it. Perhaps governments will be forced to come together to prevent tax leakage by corporate actors. There are worse solutions.
That is all.
The fact is, that the European companies hide as much or more taxes, and yet, the Europeans scream about Americans.
Just too funny.
I prefer the "u" in honour as it seems to be missing these days.