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."

Comments

Setting the bar a bit low

[SeaFox]

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.

Re:Setting the bar a bit low

[jouassou]

At that exchange rate, I don't think Google and Facebook will mind paying their due taxes in the EU...

Re:Setting the bar a bit low

[serviscope_minor]

Wow, that's quite an exchange rate.

I think they mistook Canadian Dollars for Euros.

Re:Setting the bar a bit low

[Hognoxious]

They're using the same calculation engine as Amazon.

Re:Setting the bar a bit low

[marcello_dl]

Yes, 600.000.000 EUR is not 700 USD, I got it, heh.
But TFA talks about $700 USD.
So, how many euros are 700 dollars dollars?

Re:Setting the bar a bit low

[marcello_dl]

600M EUR = 700 USD
Mario Draghi and his f*in quantitative easing.

Re:Setting the bar a bit low

[silentcoder]

Well, actually enforcing international law against shell companies being anonymously owned would make huge strides - and coincidentally basically kill terrorist funding networks.
In case you were wondering, Panama is only the SECOND worst about letting people form shell companies without having to provide identifying documentation so the ownership is known... the worst offender is the USA.

There are very few American names in the Panama papers - because Americans don't need Panama to dodge taxes or hide income from atrocities... they can do that more easily in Delaware or Nevada.

Re:Setting the bar a bit low

[91degrees]

It's true. Come over here and you can buy a Mediterranean island for a few bucks.

Re:Setting the bar a bit low

[Harlequin80]

If you are trying to hide money in the delaware and you are a US citizen you are nuts. The IRS has access to the data of those bank accounts. They will data match and you will be found out.

Re:Setting the bar a bit low

[Dorianny]

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.

That is nothing. In 2009, 35 quadrillion Zimbabwean dollars would get you 1 USD.

Re: Setting the bar a bit low

[silentcoder]

And thats why the bank account belongs to a shell company. If there is no information on who owns the company the IRS has no way of finding out whose money it really is. In delaware you can create a shell company online in 5 minutes for a nominal fee with zero documentation. I bet half the companies registered in DW are owned by Homer J. Simpson of Springfiels Il.

Re:Setting the bar a bit low

[AmiMoJo]

I'm starting to realize just how much I missed picking out mistakes in the summary and mocking them in the comments under the old Dice regime. This is definitely a return to form, reminding me of the good old days.

Re:Setting the bar a bit low

[Maritz]

I suppose it gets a few extra marks for not being about the mythical 'climate change' for once...

Yeah, lol. There'll be articles on the equally fictitious 'evolution' as well. Praise Jesus.

Re:Setting the bar a bit low

[khelms]

And then there's that whole "gravity" scam.

Re: Setting the bar a bit low

[Anonymous Coward]

You lie. Though there is not a 5 month (Italy) process designed to fuck anyone trying to start a company here, you still have to have someone tied to the bank account, and they have to demonstrate their identity. You also believe that all shell companies are about hiding taxes,which is false, as most are LLCs which pass taxes through, v,s, S and C corps which are double-taxed. In reality, most shells are to protect upper middle class people from predatory lawyers. You're a damn fool to own a boat, airplane, or house over about $250k without a mortgage on it.

Re:Setting the bar a bit low

[cmiller173]

That is a weighty subject indeed.

Re:Setting the bar a bit low

[nanoflower]

That's just a conspiracy designed to hold the common man down.

Re:Setting the bar a bit low

[Opportunist]

If you sold the paper those 35 quadrillions were printed on you got WAY more.

Re: Setting the bar a bit low

[Type44Q]

Meet the new boss, just as fucking dumb as the last boss...

Re:Setting the bar a bit low

[WallyL]

You can count on the physicists to find a way to make themselves exempt, too!

Re: Setting the bar a bit low

[Harlequin80]

Bank accounts have to be tied to a person via their SSN even if the bank account is held by a company. The setting up of a company may require limited documentation, but bank accounts are a bitch.

Re: Setting the bar a bit low

[silentcoder]

And who exactly says the company bank account has to be in the US ? If the whole point is to get money out of the country to avoid taxes it makes perfect sense to create an anonymous shell company in DW or LV and use it to open an account in Lichtenstein or the Bahamas with.

Won't solve anything

[DNS-and-BIND]

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.

Re:Won't solve anything

[Anonymous Coward]

Irrelevant. Do you really feel that multinationals (who are the main drivers of oligopolization in every market they participate in; and whose reach and power worldwide has increased enormously since the Thatcher/Reagan revolution) should be allowed to keep their competitive advantage over smaller companies, just because they can afford to hire the "best" lawyers and bookkeepers? Given that SMEs have to pay, and citizens (whose income comes from something other than cap gains, which is by and large not meaningfully taxed) I see no reason why big companies should be able to avoid it. The playing field is uneven enough as it is.

Re:Won't solve anything

[cas2000]

> More money doesn't fix anything, it just generates demand for
> even more money.

Why can't greedy capitalists ever learn this valuable lesson?

Re:Won't solve anything

[bloodhawk]

I am not sure this is about the EU simply getting more money. The general population has had a gutful of large corporations avoiding tax that they themselves can't avoid paying, this in turn is allowing minor parties that speak out against this to bleed support from major political parties, they know if they don't do something soon it isn't the money they have to worry about, it is there jobs.

Re:Won't solve anything

[Anonymous Coward]

Name problems that have been solved by offshore billiionaires skipping on taxes.

Re:Won't solve anything

[AmiMoJo]

This isn't just a money grab, it's about curtailing extreme abuse of the system. These companies benefit from the services paid for by taxation (infrastructure, education, healthcare, legal system etc.) but contribute almost nothing back. Certainly nothing like what the law intended.

Essentially it's a bugfix to stop people abusing a flaw in the system, like a developer would ship for an MMO if players discovered a way to harvest vast amounts of gold in a way that was never intended.

Re:Won't solve anything

[silentcoder]

One local libertarian author cited Estonia as the reason we should ONLY care about those the Panama papers implicated in huge atrocities and actively help people dodge taxes. Estonia he says, has built their post-cold-war economy on being a tax-haven which has attracted lots of "investment" as foreign companies headquartered there to pay the low tax, and given the government lots of money to inject into the local economy which then thrived (a very unlibertarian idea that last part but libertarians have never been known for their consistency they'll break every rule they claim to believe in when the beneficiaries are already rich and libertarianism should be more properly known as neo-aristocratism).

Here's the thing he did not, however, consider. At the last G8 meeting, the African Union made a representation in which they said that Africa would gladly forgo all foreign aid - if the G8 agreed to pass harmonious laws to prevent their companies from avoiding taxes when doing business in Africa. It was a smart thing to say too - the taxes lost from taxable business in Africa every year through avoidance is almost 40 times what the continent receives in aid. If every African country cut it's corporate tax rate in half (and most are already among the lowest in the world - here in South Africa the corporate tax rate is less than 3rd of the individual income tax rate) and gave up all foreign aid - but those taxes were actually paid, Africa would be debt free in a year - and every African country would at LEAST tripple it's GDP even if it was so corrupt that 90% of the money was misspent (the actual levels are nowhere near THAT bad) - the remaining 10% invested would all but eradicate poverty on the continent.

So that changes the picture: Estonia has not had a "sound and clever economic policy" - they've enriched themselves not by producing anything, not by selling any resources of value - but by stealing the taxes due to the governments charged with caring for the poorest people on the planet. Every dollar Estonia make in foreign tax, is an African child going to sleep hungry tonight.

There is no reason this should be encouraged, supported or legal.

Re:Won't solve anything

[Anonymous Coward]

Thanks for this clear analysis. Care to share some links?

Not that I disagree: it sounds, sadly, very plausible. All this "free trading" hype seems to be a huge scam to set up a sloped playing field to the detriment of the poor.

Re:Won't solve anything

[Feral Nerd]

> More money doesn't fix anything, it just generates demand for > even more money.

Why can't greedy capitalists ever learn this valuable lesson?

Because it is a side effect of greed? Greed affects certain parts of the brain. It cripples the part that handles common sense, completely switches off the morality centre and there is nothing you can do about it any more than you can stop your joystick from dripping if you get infected by a drug resistant Chlamydia Trachoma strain.

Re:Won't solve anything

[Kkloe]

well then, if it doesnt help the EU it will help the USA as they will get less money to do crap with

so headline for this story should be, "EU proposes plan to help USA do less crap"

Re: Won't solve anything

[Anonymous Coward]

There is nothing wrong with paying for services from other countries and this doesn't stop or tax that. It is about stopping them avoiding taxes when the services weren't actually provided by some other country (except of course some clever book keeping). Taxation is definitely excessive, but what is theft is what most of the major corporations do to various countries around the world at the moment.

Re: Won't solve anything

[Half-pint HAL]

Corporations earning money and paying other countries for the services and infrastructure that THOSE countries provide at lower prices - that is, like, SO unfair! You may say that "taxes are theft" as a general attitude is extreme, but this particular tax initiative is most definitely theft and nothing more.

May I direct your attention to Starbucks? Starbucks have traditionally paid practically nothing in taxes in any country in the EU. They achieved this by putting all the profit onto their beans -- all Starbucks Whatevercountryorother LLC/Ltd/GmBH subsidiaries have to buy official Starbucks coffee, which is a 100% closed market. Starbucks coffee for Europe is sold via Switzerland, but the coffee never even enters the country. Starbucks' operation in Switzerland is just an office that subcontracts most of the work out. The actual operations of the company are not built on Swiss services or infrastructure.

Or how about Amazon? For most of Europe, we buy our goods from Amazon's Luxembourg operation, and they subcontract "fulfilment" to a local Amazon subsidiary who then ship it out. The goods are never in the physical possession of the Luxembourg company, and never ever visit Luxembourg. I could order a product that was designed and made entirely in Scotland from Amazon, have it delivered to me here in Scotland from an Amazon UK site in Scotland; the item would never have left Scotland at all, and yet I've allegedly bought it from a Luxembourg-based company. Again, the services and infrastructure that the business relies on are not merely based in Luxembourg -- the majority of it is not. And yet the UK tax evaporates.

Part of the point of laws like this is to level the playing field -- small specialist webshops are constantly being crushed by the likes of Amazon. Not only because of Amazon's natural economies of scale, but because of the manufactured economy of profit exporting.

Re:Won't solve anything

[Half-pint HAL]

Casino and hookers? Still better than nothing (providing they are legal in that country)

It's even better when they're illegal. Vice scandals sell newspapers. People tend to buy sweets and fizzy drinks when they're in the newsagent. Thus casinos and hookers stimulate a vibrant local economy. :-)

Re:Won't solve anything

[JaredOfEuropa]

It's not (only) about getting more money for the EU or member states' governments. It's also about making them pay their "fair share" so others will have to pay less.

Now in almost any context I abhor that phrase "fair share", usually there is nothing fair about it. But in this case we're also talking about fair competition. Evading taxes is an expensive game that requires expert knowledge and a fair amount of money to set everything up, but it is also something that benefits enormously from economies of scale: it may cost $5.000 to hide $10.000 in profits, but only $50.000 to hide $1 billion. That puts tax evasion out of reach of small and medium enterprises, who will have an even harder time competing with the multinational giants if they are forced to pay the taxes thet the big boys can evade.

Re:Won't solve anything

[serviscope_minor]

Funny thing is I've had quite a few AC comments written in exactly the same style recently. It looks like I've got my very own AC stakler!

Whose so cute? Yes you are! Yes you are!

Re:Won't solve anything

[bigpat]

This isn't just a money grab, it's about curtailing extreme abuse of the system. These companies benefit from the services paid for by taxation (infrastructure, education, healthcare, legal system etc.) but contribute almost nothing back. Certainly nothing like what the law intended.

On the one hand, yes sure if they are actually illegally not paying taxes then I have no argument against that. If those are the taxes that the country has democratically decided. If a company just has a physical address and doesn't really do business in a country and then yes we are likely dealing with some level of fraudulent behavior just moving money around and laundering it in the lowest taxed placed.

But for the most part what we are talking about are companies following the letter of the law to avoid corporate income taxes, while still paying boatloads in taxes in sales/vat, income and property taxes. It is simply a fallacy, a plain lie, to say these companies are not paying any taxes in the countries where they operate and do business. And if they are following the letter of the law in avoiding taxes wherever permissible, then good for them and it is up to those countries to democratically decide whether or not they want to increase or lower taxes.

Simply put, if people are being employed at a physical location and/or buying the company's products and services inside that country then they are likely already paying their fair share through that myriad of taxes.

I support transparency as a way for democratic nations to decide whether or not their laws are working, so requiring companies to further report their balance sheets on a country by country basis should help lawmakers determine if the laws they have crafted are working as intended.

But ultimately, it is only right to tax income, sales/vat, and property that are actually located or transactions that take place inside that country. Otherwise, you are simply saying that commerce between countries cannot take place without a huge tax penalty.

Re:Won't solve anything

[roman_mir]

As if infrastructure, healthcare, education, etc. come from government that conjures up the resources without taxes. The infrastructure, etc., anything government is involved in (AFAIC none of it is government business, I digress), all of the money for it comes from taxes in the first place and all taxes originally come from businesses doing something that actually contributes to society. Society and economy only exist because companies build the products and services that people need, companies hire people, companies provide investment opportunities and eventually capital. To say that companies do not contribute to society is like to say that the Solar System does not contribute to life on Earth.

Re:Won't solve anything

[ooloorie]

These European countries benefit from the services paid for by US taxation (R&D, military defense, infrastructure, education, healthcare, legal system etc.) but contribute almost nothing back.

There, FTFY

Re:Won't solve anything

[bluefoxlucid]

It's kind of a balance thing. Do note that the moderate middle is not necessarily the correct view in all cases; but most things don't work at extremes. In the great many cases where a moderate middle *is* correct, it's a middle of objective extremes; the golden mean of ideal A and ideal B is not necessarily the golden mean of extreme -1 and extreme +1, and the correct course may not be precisely 0.

It's correct to say that allowing businesses to evade 100% of all taxes is non-ideal.

It's also incorrect to say that taking more and more money from businesses will solve any problem, because it's incorrect to say that economy is money and more money equals more wealth.

Some people have this ideal that economies are basically driven by the movement of money, and so making money move more often makes the economy stronger. That's false: economies are driven by production, which is paid for with money. If you make money move unproductively (by taxes, administration, and fake jobs), then you take a productive resource (human labor) and put it into an unproductive role (handling money and forms related to money). In short: where a man could get paid $50,000 to make 1,000,000 tonnes of wheat, he is instead paid $50,000 to sign papers at a desk which only get signed so we can give someone a job, pay for it in taxes, and move money around. Besides taxing $50,000 more from the consumer base, you have lost productive capacity that could make 1,000,000 tonnes of wheat, several thousand chairs, computer software, or anything other than essentially *nothing*.

So the long and short of it is you get people who say, "Well, we should tax the businesses a lot, and stop them from hiding their money, because money makes the world go around!" and this is wrong because economies run on productivity, businesses do strain under high taxes, and typically over 90% of a business's income is expenses which eventually flow down to wages (including high-dollar executive wages) (Farms theoretically aim for a 20% profit, but in practice make 10% or less). On the other side, you get people who say, "Well, we should *cut* income taxes on businesses to stimulate growth!", and this is wrong because growth comes from job (labor) growth, which comes from demand, which comes from consumer buying power, which is tied to wage-labor cost (wages, payroll tax, benefits, etc.) and wage-labor cost-income efficiency (the percentage of wage-labor cost which actually reaches the worker's bank account).

The rough conclusion is that maybe taxing the businesses *a lot* isn't a great plan; cutting the taxes back on businesses has minimal effect; and somehow squeezing more money out of the businesses probably won't do much to actually make the world wealthier (although it might pull more money from another country to your country, allowing you to buy more of their productivity and enrich yourself while leaving them poorer).

I usually favor plans which increase wage-labor efficiency, which leads to more jobs and a more stable economy, allowing riskier investments in new technology, leading to faster technological growth and, ultimately, more wealth. Technological growth is why the average working-class family spent 60% of their hard-earned income on basic needs in 1950, but only 30% on the same basic needs in 2010--meanwhile eating out more and buying THREE TIMES as much housing space, and somehow still managing to buy more non-essential goods (because they spent 6% more on all that extra housing, 20% less on food, and 10% less on clothing). Essentially, I want to live in the world of 1960-1980, where the cost of living relative to wages kept falling and all this new magic kept hitting the shelves. All those high-tech gizmos that we thought would come out 15 years ago but which have started trickling in now and will probably arrive in 15 more years should have all come out 10 years ago.

Such plans include a Citizen's Dividend (a type of UBI), which increases consumer income while not adding wage-labor costs to

Re:Won't solve anything

[phorm]

Except that domestic companies are even worse. Owned by internal corrupt government members, they're pretty much above the law and all the money goes back to those same corrupt governments. Since they have no international presence, there's not the same international pressure to clean up their act either.

Re:Won't solve anything

[Solandri]

The thing about arguing it that way is that there are two possible solutions, one of which is a lot easier to implement and enforce.

A) Force multinational corporations to comply with the same tax laws as small businesses.
or
B) Stop taxing corporations.

"But B is outlandish! Blasphemous even!" Let me ask you this: Do you believe in taxation without representation? Do you believe corporations deserve representation in government? For most people the answer is no, no. What's the logical conclusion regarding taxing corporations then?

The usual argument people bring up to counter this is that the people who own and/or work at the corporation already have representation - they're allowed to vote, so it's OK to tax their comopany. That argument doesn't fly because those people are already taxed (as individuals) the same as people who don't own or work for a corporation. What's your justification for taxing them more just because they own or work for a corporation?

"But the government would lose billions in tax revenue!" The economy doesn't work like that. All taxation is is diverting a certain percentage of the country's GDP to the government coffers. For the most part, where that money gets diverted from doesn't really matter.* If you eliminated all income taxes and shifted the entire tax burden to corporate taxes overnight, what would happen? Everyone would suddenly have (say) 25% more money, but would their purchasing power increase by 25%? Nope. Companies would be forced to raise their prices to pay for the new taxes, and the price of goods and services they sell would increase - exactly enough to wipe out the 25% extra money people gained. Per capita purchasing power increases can only originate from increased productivity. Taxation is just moving money from one purse to a different purse - it does not affect productivity

Neither do companies for that matter. Companies are just a shell - it's the people who work for that company who generate its productivity. People are the only source of productivity, so ultimately any tax burden is paid for by people regardless of what type of tax you use to collect it - income taxes, sales taxes, corporate taxes, import taxes, customs taxes, all of it is ultimately paid for by people. Think of the economy as a giant donut-shaped swimming pool (in reality it's a web but it's conceptually easier this way), and economic activity as the speed at which the water circles around. Individual people move that water around by paddling it (adding productivity to the economy). A company is just a group of people paddling together. Someone who is self-employed is paddling on his own. Taxes are just a diversion in this donut which directs about 35% of the water into government control, for the government to decide where the water should outflow. But it's always people who do the paddling regardless of whether they work as individuals, work for a corporation, or work for the government.

Eliminate corporate taxes and there's no incentive for these companies to shift income out of these countries. The money stays where it's needed,** and if the company is generating a lot of income in that country, it will keep money in that country to finance its operations. That money gets spent in that country, meaning more income and sales for that country to tax. **The exception would be profits distributed to owners/shareholders. But in a simplified tax structure like this, you could simply assess those people income tax based on (corporate dividend from that stock) * (percent of company income generated in country x) * (income tax rate in country x). Heck, you could even argue that a corporate tax is a simpler way to do just that. The drawback is that a multinational corporation exists in multiple countries simultaneously so a corporate tax creates an incentive to shift income out of countries with higher corporate taxes, whereas an individual can only exist in one country at a time. And

Re: Won't solve anything

[silentcoder]

Oh yes. Some westerner telling an African what my own home is like because you think you know better than the people who live here.
Hint: the most corrupt companies in Africa are local subsidiaries of large multinationals. They exist solely to do their parent company's dirty work while maintaining plausible deniability. When somebody gets murdered for not wanting their ancestral land turned into a mine you can be certain of finding a large multinational mining conglomerate with a local subsidiary who wanted to mine there. Had that happen here last week.

Re: Won't solve anything

[phorm]

I completely agree that there are corrupt multinationals operating in Africa who allow or create human-rights abuses and don't follow safety/environmental practices. Sadly, I'm even aware of some from my home country. This also happens in other countries such as the garment industry in Pakistan,etc

However, as per the article, the thing about many of these companies is that at least when they're caught out, there can be enough of an outcry and/or penalties to push for a change in behaviour. The domestic industry is pretty much untouchable due to links with local government and no international accountability (the solution of "help overthrow the corrupt government" doesn't tend to work out so well either, as we've seen many times).

So no, I'm not saying we're innocent and rosy, and certainly western countries have their share of corruption. Meddling in politics to remove rights, burying human-rights-violating companies under shells. Not to mention that we've pretty much shipped industry overseas in general, which screws both local citizens (loss of jobs) and allows the corps to profit in a low-regulation jurisdiction. NIMBY'ism tends to be bad on this one... people don't want local mines, plantations, etc because they look bad and may have local environmental impact (so instead lets send them to screw the environment somewhere else that has even LESS regulation).

But beside all that, the point still remains. Multinationals are nasty and bad. In many cases the local corporations - especially as tied to the regime - are just as bad and even less accountable (barring revolt).

Re:Won't solve anything

[LynnwoodRooster]

So if I work in, say, Thailand but am a US citizen who doesn't set foot in the US for the entire year, should I still have to pay US taxes? Note that I'd pay Thai taxes...

Likewise with corporations. I have taxes I pay here, domestically - but if a significant amount of my revenue is earned overseas, why should I pay domestic taxes on foreign earned and held income? Note that I'll pay the required corporate taxes of the overseas jurisdiction, as demanded by law.

In reality, we should simply drop the whole corporate income tax thing altogether. Simply implement a national sales tax. Tax consumption, not income. Encourage self-investment, savings, wealth creation rather than punish it.

Re: Won't solve anything

[rahvin112]

The problem with these tax avoidance scheme and Europe's ability to stop them is tied entirely to the fact that several of your own countries are facilitating this. Rather than singling out certain size companies the EU should be going after the countries for creating tax rules that aren't in compliance with Union rules. As it is, the EU is trying to single out several companies rather than attacking the real problem. This distracts the electorate but doesn't actually solve the problem, the problem will continue just with companies smaller than the limit identified.

If the EU wants to actually solve the problem they need to go after the actual problem and that is Denmark, Luxembourg and Ireland (probably others as well) facilitating tax avoidance in other member countries. That's the only thing that's going to solve this, but that's hard so they won't try to fix the actual problem.

Re:Won't solve anything

[tommeke100]

Maybe, but who's going to suffer? The middle class and low hanging fruit. Look at the stock trading taxes they've created in Belgium. There wasn't a clear law on how much taxes were due when people were stock-trading. So they created a new law: every stock sold within 6 months of buying is taxed 30% on capital gains (with no possibility to deduct losses of course). So, if you have a portfolio with 5 stocks and 4 lose money and one wins (but on average you're losing money), tough break, we'll take 30% on your gains for that stock. Also, a Last In, First Out scheme is used. So you bought GOOG stocks 10 months ago, and are buying new ones and selling some of that prior stock 3 months later. Tough break, we'll tax you 30% on those stocks anyway because you bought some 3 months ago. Exchange rate? Doesn't count! Oh you bought GOOG on NASDAQ and it gained 5% but the Euro lost 10% so you basically lost money? tough break, we'll take 30% on your dollar gains, bitch!
Guess what's not taxed? Funds and Corporate Portfolios! Exactly the kind of things the actual rich peeps can set up.
Definitely not the little middle class dabbling with 2000$ worth of stocks here and there. With transaction costs, they need to make like over 6% to break even.
Conclusion: The Belgian State doesn't think actively trading is something little nobodies should do with the money they already got taxed 50% on while working. They rather should be paying 60% taxes on their income and put the rest on their savings account so they can gain 0.015% interest on it.

Re:Won't solve anything

[AmiMoJo]

In some European countries courts can hold companies liable even if the exact letter of the law was not breeched, if it was reasonably obvious that the spirit of the law was different. If it's ambiguous the company will generally get a pass that time but be expected to comply in future, but the court thinks that they were deliberately interpreting it in a way they knew was not intended they have to pay.

I believe that Germany operates that way, for example.

Re: Won't solve anything

[LynnwoodRooster]

So the issue isn't the company acting completely legally and even ethically (given the intent of corporations to maximize profits for their owners). It's countries offering taxation terms and rates that other countries (typically larger, more powerful countries at that) cannot or do not want to match. So rather than adapt to their more nimble competitors, the big countries will penalize the corporations.

Re:Won't solve anything

[Anonymous Coward]

""But B is outlandish! Blasphemous even!" Let me ask you this: Do you believe in taxation without representation? Do you believe corporations deserve representation in government? For most people the answer is no, no. What's the logical conclusion regarding taxing corporations then?"

Except right now that have even better than representation, they have complete control. You're just another dope arguing that everybody else should have to fund their increasingly insane demands.

Re:Won't solve anything

[bigpat]

Yes, that is why I said if they aren't actually doing business in a country then it is more clearly a tax dodge. But most countries exclude overseas income kept overseas from local taxation as a matter of policy. It isn't a tax dodge, just common sense.

Re:Won't solve anything

[jwdb]

You give one argument against eliminating the corporate tax and counter it in detail, but another argument given frequently is the following: if corporations are not taxed, then anyone with a good accountant will incorporate themselves, pipe everything to this company instead of to themselves personally, and thereby live tax free.

I believe this already happens in Belgium, where individuals set up companies to buy the house they want so as to avoid tax at the time of purchase. Companies pay capital gains at sale instead, but since many Belgians are sedentary, that'll likely only be an issue for the estate after they're dead.

To make eliminating corporate tax workable you'd at the very least have to introduce a broad VAT-type system where inter-business transactions are also taxed. That, or set up a very elaborate benefits-in-kind detection scheme.

Re:Won't solve anything

[erapert]

Absolutely brilliant. I don't have mod points, but I love your post.

Re: Won't solve anything

[cas2000]

So rather than adapt to their more nimble competitors, the big countries will penalize the corporations.

a race to the bottom is not a solution.

Re:Won't solve anything

[cas2000]

"But B is outlandish! Blasphemous even!" Let me ask you this: Do you believe in taxation without representation? Do you believe corporations deserve representation in government? For most people the answer is no, no. What's the logical conclusion regarding taxing corporations then?

Corporations are not people, they are an artificial legal construct created by governments. They do not deserve representation.

BTW, the people who directly or indirectly own them already have representation. Those people do not deserve double (or triple or whatever multiple) representation just because they own or part-own one or more companies.

Re: Won't solve anything

[LynnwoodRooster]

You can tax too much - and you can tax too little. Taxation of zero ends up without enough infrastructure to support multi-national corporations. Check out the Laffer Curve; perhaps most of those big countries are too high? Especially for the US. Not only do we have the highest statutory corporate tax rate in the developed world, and the second highest effective corporate tax rate in the world. I surmise if the US corporate tax rate was down around the OECD average, you'd have a lot less offshoring of profits and operations.

Re: Won't solve anything

[Half-pint HAL]

So the issue isn't the company acting completely legally and even ethically (given the intent of corporations to maximize profits for their owners). It's countries offering taxation terms and rates that other countries (typically larger, more powerful countries at that) cannot or do not want to match. So rather than adapt to their more nimble competitors, the big countries will penalize the corporations.

Yes and no. First up, using a low rate to get business you wouldn't otherwise have isn't "nimble", it's opportunistic, and pretty short-sighted. Look at how the banks messed themselves up by constantly competing on interest rates until they reached the point where practically none of them could sustain their business without massive cash injections. When people talk about a "race to the bottom", that's exactly what the banks did, and if there had been no bail out, 90% of the world's banks would no longer exist. Now imagine 90% of the world's countries going bust. Not pretty.

Now, back to that word "nimble". Some countries are so small (eg Luxembourg) or so isolated in terms of transport (eg Switzerland) that they actually have no horse in the race when it comes to large-scale goods businesses -- people will not move to a tiny landmass or the middle of Europe's most mountainous region to store and transport metric gigatons of consumer tat or branded coffee beans -- so they have nothing to lose from kicking the bottom out of the market. Luxembourg and Switzerland don't actually do most of the work for Amazon or Starbucks. How does "not actually doing the work" equate to being "nimble"?

Re: Won't solve anything

[Half-pint HAL]

I surmise if the US corporate tax rate was down around the OECD average, you'd have a lot less offshoring of profits and operations.

Only two things stop off-shoring of profits. 1) having the lowest tax rate. 2) making it illegal.

The structure that should not be legal is for wholly owned subsidiaries to have cross-border single-supplier agreements with parent companies or companies with a shared parent. If you have to buy from a company that's owned by the same people as you, that really should be taxed as though it's the same company.

Re: Won't solve anything

[LynnwoodRooster]

You don't have to have the lowest tax rate; you can have a reasonable tax rate and companies will on-shore their profits. Many countries are examples of that (including Singapore, for example). Too high and you offshore as much as you can. Reasonable rates, and companies will still on-shore profits because it does allow you to leverage your cash in your own domestic markets and financials.

Re: Won't solve anything

[Half-pint HAL]

Reasonable rates, and companies will still on-shore profits because it does allow you to leverage your cash in your own domestic markets and financials.

All well and good for companies that do indeed have such thing as their own domestic markets, but multinationals typically don't. "Reasonable rates" only work when offshoring has its own inertia and involves significant costs, but when you're a huge multi-billion dollar operation with wholly-owned subsidiaries in several dozen countries, the mechanisms to offshore profits are essentially already in place. Even if it means creating an additional wholly-owned subsidiary, the business processes are already in place to manage multiple geographically diverse subsidiaries, so the benefits of tax havens always outweigh the costs for them. The effects of this are a double-hit in competition: domestic rivals have to compete both against their global counterparts' economies of scale and their low tax burden.

Re: Won't solve anything

[LynnwoodRooster]

Which multi-national does NOT have a domestic market?

Re: Won't solve anything

[dywolf]

the Laffer Curve is a joke.

oh, sure, it describe a real thing, a real concept (it's just a variation on price elasticity of demand).

the problem is, a modern economy simply cannot move past the peak into the zone where reducing taxes increases revenue.
the economy collapses well before then. no modern economy exists or has existed on that side of the graph.

even when the top marginal tax rate of the US was over 90%, the country was still well to the left of the peak.
that's why it's an accurate statement that no reduction in taxes has ever created an increase in tax revenue.

that's why Laffer's curve is a joke, a red herring, a misdirection.

Ironic

[Teun]

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.

Re:Ironic

[TheRaven64]

There isn't likely to be any complaint. The British government is currently a little bit shaky over the Panama leaks. It turns out that the Prime Minister blocked previous EU plans to strengthen disclosure rules for off-shore trusts, and is the beneficiary of an off-shore trust. The Chancellor wasn't popular even before the current revelations, but it turns out that both he and the PM have benefitted from the lower tax rate for high income holders and a large chunk of his income comes from dividends in a company that hasn't paid any UK tax for years. They're playing up the fact that it was a British commissioner who is pushing this because they want to make it look as if the British Government is in favour of this kind of thing. Now, of course, they may try to block it in a year's time when people have all forgotten about the current scandals...

Re:Ironic

[muffen]

This was up for debate in EU a while back, and it was the british who blocked it. However, with the panamapapers being leaked, and Cameron's own involvment, it might not be so easy to block it this time.

The timing isn't an accident, and the british commissioner leading it isnt an accident either, its all designed to maximize the chances of it going through.

I think this is a good start, you pay taxes where you earn the money...

Re:Ironic

[Xest]

"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."

Making it a British problem is the Corbyn line, but it's pure populism and incredibly hypocritical. Britain has recieved flack for hundreds of years for it's imperialism, if we were to start dictating what crown dependencies do, effectively disenfranchising them by removing their previously granted right to independently govern themselves. The idea of someone like Corbyn who proclaims the ability of the Palestinians to self-govern as one of his most foremost beliefs in things that should happen dictating that we should remove that exact same right from crown dependencies (and, as an aside, to force the Falkland Islanders to be governed against their will by Argentina) is one of the most profoundly hypocritical stances in modern politics.

It's not the 1800s, we can't simply take away the rights of these dependencies to self-govern. This doesn't mean there aren't things we can do, but imperialism needs to die and so Britain treating these dependencies like it does any other tax haven nation that isn't a crown dependency is the exact right thing to do. The fact they're crown dependencies should be neither here nor there, we should treat them and their people with the respect that we treat any independent nation.

But outside of the argument about what's morally right, there's also the more pragmatic point that it'd be wholly self-defeating anyway. We do like the fact they choose to be crown dependencies because it's mutually beneficial for trade, for military ties, for geopolitical support and so on. If we attempt to rule them with an iron fist from Westminster they'll simply choose to go for full independence and continue doing what they do regardless of what we think. I seem to remember there being a rather large country in the West that was also ruled from London once and wasn't too happy about it and decided to go for independence, I seem to recall there was a lot of bloodshed too, I think they call that country America or something and relations weren't too good for quite some decades afterwards. I think some kind of White House even got burnt down or something about 35 years later.

So long story short, we treat the independence of crown dependencies with respect for good reason. If we start to play with that then it causes all sorts of shit and is simply a form of oppression. That's why any deal to fix tax havens has to be universal, and cannot simply be something that is applied unilaterally to crown dependencies, because if it is we're inherently telling those dependencies that they must give up a major source of their income to other tax havens that aren't crown dependencies meaning we don't solve the problem, and we make the lives of the citizens of those dependencies a whole lot worse to the benefit of citizens of other tax havens that can't be dealt with as dependencies.

In other words, what's the fucking point? It's dumb-think politics, it's hypocritical, and it's populism, pure and simple. I'm not defending tax havens, nor those who use them, but I do think the people who live in those countries, many of whom are in fact incredibly poor, deserve the right to retain the degree of political independence they haven chosen, that is not something that should be revoked from them regardless of what their financial sector is doing. Hit the financial sector, not the people.

Re:Ironic

[Half-pint HAL]

The fact they're crown dependencies should be neither here nor there, we should treat them and their people with the respect that we treat any independent nation.

They're either British or they're not. If they're British, we're responsible for them, and should intervene (as happened for the abolition of the death penalty). If they're not British, we should can the whole Crown Dependency malarky and let them be truly independent nations.

As for Les Îles Falkland (in the original French), I don't see Corbyn's statement as hypocritical really. It is one of self-determination. The Falkland islanders have chosen by referendum to subject themselves to British rule -- self-determination. The British authorities have always held the right to remove people from their homes via compulsory purchase orders. The Heygate flats in Elephant and Castle, for example, were subject to compulsory purchase for commercial land development, displacing 1000 people in a single move -- that's a third of the population of the Falkland Islands. Figures are very difficult to come by, but I wouldn't be surprised at all if UK councils moved the equivalent of more than the entire Falkland population every year under CPOs.

The Falkland Islands are a massive sinkhole for public money, and if we applied the same standards to Falkland Islanders as we did to people on housing benefit, we'd cry "austerity" and send an aircraft carrier to transport them to new homes in the UK with no spare bedrooms.

The case for retaining the Falklands, on the other hand, is little more than a matter of pride and posturing. We do not, and never will, get any material gain from retaining control over them. So I say we cut them loose. Give the islanders the choice between forming an independent nation or relocating to the UK. Self-determination, and certainly not incompatible with the view that the people of Palestine have a right to self-determination in their own land.

Re:Ironic

[Xest]

Maybe if you were right - either they're British or they're not, then you'd have a point, but despite your attempt to simplify the issue down to binary dumb-think that's just not the reality we live in. The fact is that self-governing dependencies are an actual thing whether you choose to try and write off the whole issue by pretending otherwise or not.

As for the rest of your post, it was just a mess of confusion of various completely irrelevant issues so I'm not even going to waste my time other than to point out that you too are demonstrating blatant hypocrisy by supporting the Palestinian cause whilst suggesting Falkland islanders should face summary eviction, removal, and destruction of their homes. What the fuck do you think that sounds an awful lot like exactly? You don't think there's hypocrisy in the view, because you also apparently share and argue the exact same hypocritical view, so no shit, well done, you've shown that like most hypocrites you don't recognise your own hypocrisy either.

Re:Ironic

[danbob999]

If we attempt to rule them with an iron fist from Westminster they'll simply choose to go for full independence and continue doing what they do regardless of what we think

So? It seems to me that it would be a lot easier to invade them with the help of the British armed forces than fighting them defending their colony.

Re:Ironic

[Half-pint HAL]

As for the rest of your post, it was just a mess of confusion of various completely irrelevant issues so I'm not even going to waste my time other than to point out that you too are demonstrating blatant hypocrisy by supporting the Palestinian cause whilst suggesting Falkland islanders should face summary eviction, removal, and destruction of their homes. What the fuck do you think that sounds an awful lot like exactly? You don't think there's hypocrisy in the view, because you also apparently share and argue the exact same hypocritical view, so no shit, well done, you've shown that like most hypocrites you don't recognise your own hypocrisy either.

No, I didn't say that they should be evicted, just that they wouldn't be the only ones in British territory that had been evicted. British citizens are forcibly evicted all the time for public infrastructure and private development, so there's no reason that this particular group of people should be exempt.

Now, if you look at my final paragraph, you'll see that I am not in favour of just kicking them out. I am perfectly happy for them to be a truly independent country. That is the choice I would give them -- UK or independence.

Re:Ironic

[Xest]

"No, I didn't say that they should be evicted, just that they wouldn't be the only ones in British territory that had been evicted. British citizens are forcibly evicted all the time for public infrastructure and private development, so there's no reason that this particular group of people should be exempt."

You mean apart from the fact that they're independently governed? The people you refer to who have been kicked out have made no such moves to be independently governed, and are in fact simply being kicked out by the representatives they elected.

What you're talking about is overruling elected representatives from higher up, by people who haven't been elected by the people making the decision. That's a very different thing.

You can't conflate two completely different issues with such simplification and expect to come out with a rational argument because things just are not that simple.

"That is the choice I would give them -- UK or independence."

Why? The status quo is mutually beneficial. They get protected from an aggressive neighbour, and we get a useful refuelling point on the way to our Antarctic research areas and a place where we can trade and our companies can do business (i.e. our oil companies). You seem to be arguing that we should break something that benefits both sides just because you want to rebel against the status quo regardless of how meaningful or useful that rebellion is. That isn't a sensible reason, especially when your rebellion means people lose their homes and their entire lives get ruined, and the British tax payer ends up out of pocket because journeys to the South Atlantic become far more costly. I'm also sure you wouldn't be so for such a policy if your house and relationships were the ones at risk.

You seem to be advocating defacto dictatorship and removal of enfranchisement for these people which is, well, disturbing. Your argument can be pursued all the way back to saying "We might as well get rid of parliament, and just reinstate primacy of the monarch as decision maker". If you take away local rule from dependencies why not take it away from councils also and rule direct from Westminster? If you're taking it away from them, why not take it away from Westminster and go straight to the Queen? You seem to be advocating something for one set of people, that I'm sure you would never advocate for yourself. Tell your local council it should become independent or accept direct rule from Westminster - yeah okay then, that's going to end well isn't it?

Re:Ironic

[Half-pint HAL]

You mean apart from the fact that they're independently governed?

If they're independent, why are they a "dependency"? I am against this halfway-house status.

They get protected from an aggressive neighbour

The Argentinian case for ownership is a very weak one, and all its credibility derives from the idea that crown dependencies are little more than colonies, and that decolonisation is a justifiable goal. An independent Falkland Islands state would completely torpedo that claim. Also, calling Argentina an "aggressive neighbour" is unfair. Yes, it was an Argentinian government that started the war, but it was a military dictatorship at the time. It was a brutal dictatorship that "disappeared" a lot of its own citizens to inspire terror in its own populace. More Argentinian citizens were killed by the junta than died in total on both sides of the war. You are placing the blame for atrocities on the victims, rather than the perpetrators.

a useful refuelling point on the way to our Antarctic research areas

I'm pretty certain an independent F.I. would be perfectly happy to service visiting ships from the UK, among other countries, as part of the market economy. If they cannot compete with ports on the South American mainland, then this would imply that they are uneconomic, and that we're overpaying, thus the arrangement cannot be mutually beneficial.

Perhaps what I'm really proposing is the privatisation of the Falklands.

Re:Ironic

[Half-pint HAL]

In fact, the Falklands War was one of the main triggers for the Argentinian people to finally kick out the junta and restore democracy.

Re:Ironic

[Xest]

"If they're independent, why are they a "dependency"? I am against this halfway-house status."

That's fine, but they are not, nor has any British government ever been, nor is there any real public support for it, so whilst you're entitled to your opinion, it is I'm afraid, unfortunately, entirely irrelevant. Furthermore, you've not really explained how it improves anything, so it's not really clear you're against it for any reason other than simply being a contrarian right now.

They're not independent any more than Scotland is independent, but they do have the right to self-govern on various localised issues, just like Scotland does, just like Wales does, and just like Northern Island does. Scotland voted to stay with Britain, but with a promise of more autonomy because the alternative would lead to potential economic chaos.

"The Argentinian case for ownership is a very weak one, and all its credibility derives from the idea that crown dependencies are little more than colonies, and that decolonisation is a justifiable goal. An independent Falkland Islands state would completely torpedo that claim."

The Argentinian claim doesn't have any credibility from it's colonial justification, that's just a word it thrusts about without truly understanding it, because when Argentina claims it wants to take the islands and push the people off them then that's actual colonialism, therefore, no one takes Argentina's colonialism claim seriously because it's so very obviously hypocritical. Largely, the talk of colonialism is aimed entirely at their home (or at least) South American audience who have a long standing grudge against colonialism, not because it has any actual merit.

"Also, calling Argentina an "aggressive neighbour" is unfair. Yes, it was an Argentinian government that started the war, but it was a military dictatorship at the time"

My comment on them being aggressive has little to do with the past, and everything to do with the fact that they've been harassing Falkland's ships, aircraft, and companies. That's hostility. If Argentina wants the Falklands it should start being nice to them, start building great economic ties, and start making the Falkland islanders want to be independent, or part of Argentina, until it does that it has no legitimate claim. The current actions are the result of the people Argentinians have voted into power, therefore, they are not victims, they are perpetrators for being part of the widespread Argentinian support for treating Falkland islanders with hostility, purely to distract from the fact they've royally fucked up their own country for about the millionth time.

"I'm pretty certain an independent F.I. would be perfectly happy to service visiting ships from the UK, among other countries, as part of the market economy. If they cannot compete with ports on the South American mainland, then this would imply that they are uneconomic, and that we're overpaying, thus the arrangement cannot be mutually beneficial."

What you're assuming is that Argentina wouldn't just take the islands by force again and prevent that, or even just settle a bunch of Argentinians on the island and use non-military violence (police, mobs) to push out the current inhabitants. If what you're proposing is that the Falklands still get British military protection through some kind of deal but not be a crown dependency then sure, that could work, but it's not really clear how in all practical terms that's any different from the status quo.

For what it's worth, British crown dependencies (in cooperation with British and French depedencies) throughout the Atlantic allowing British military presence has been one of the single most succesful policies in limiting the ability of Central/South American drug cartels and their associated violence spreading drastically through the Caribbean and over to the Atlantic. British military presence in these places isn't just about penis waving, or colonialism, it serves a genuine purpose and has had an incredibly strong stabilising effe

Re:wtf headline

[bickerdyke]

That would be the authors of the plans themselves.

But the idea is not completely wrong as to find out if someone pays all due taxes, you need to know how many taxes he's paying to begin with. The next step would be to use those data to recognize money-shifting for tax reason. Final goal would be to close the multinational legal loopholes used, but that's scheduled well after world peace and understanding women... (I heard they booked a conference room for a discussion on that subject at the new Berlin airport....)

Actually this is the problem

[Anonymous Coward]

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

Re:Actually this is the problem

[silentcoder]

It comes from a supreme court case in 1910 when a corporation decided to pay it's workers a decent living wage, and cut margins a bit to afford that. The shareholders sued claiming the CEO had no right to pay workers a penny more than the least he could get away with - as that reduced their profits. They won.

However, it's pretty important to know that this was an American case, it has no bearing on any other country nor is it supported by the laws of any other country. German law, for example, does not describe companies in a way that could possibly support such a legal finding - companies there are described as communities existing for the benefit of all involved - shareholders, employees and customers alike and would lose a case where they screwed any of those (which is why in Germany every corporate board HAS to be made up of 50% non-shareholding employees, usually appointed by the union).

So the logic that drives that is uniquely and exclusively American (and to a lesser extent exists in Britain) but the rest of the world is not that insane. This is why laws like these tends to look like they target American companies (look at how facebook got mentioned here) - it's not really the case, they are laws the likes of which European companies have always worked with and complied with happily because *not* complying would require doing unthinkable. The utterly opposite incentives created by US laws leads to US companies feeling targetted since their behavior mostly consists of those "unspeakable things".

Re:Actually this is the problem

[Anonymous Coward]

"The shareholders sued claiming the CEO had no right to pay workers a penny more than the least he could get away with - as that reduced their profits. They won."

That case doesn't bar a company from changing their mission/ethics/charter from a 100% shareholder value motive with the support of shareholders. Once the charter is established, future shareholders have no case against the directors as long as they are following the company charter. So that case doesn't mean that corporations must act to maximise shareholder value, it only sets the default charter to that.

Re:Actually this is the problem

[Imrik]

Just like Americans can elect someone different if they don't like how the government is spending their money.

Re:Actually this is the problem

[emorning]

It comes from a supreme court case in 1910 when a corporation decided to pay it's workers a decent living wage, and cut margins a bit to afford that.

There is no legal duty to maximize corporate profits and 'shareholder value'.

And what supreme court case are you talking about? Dodge v. Ford Motor Co?
That was a Michigan Supreme Court case, not a US Supreme Court case. And even that case really has nothing to do with shareholder value.

Re:"Fair share", my ass.

[Anonymous Coward]

Last I checked, laws trump "fiduciary duties"; never even minding that the latter are an ideological joke designed to "justify" the fact that CEOs/directors screw everyone they can [iow, sociopathic behavior].

we need a "rogue tax-haven nations" list

[cas2000]

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.

Re:we need a "rogue tax-haven nations" list

[serviscope_minor]

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.

Yeah isn't it so unfair that if you go round murdering people, then everyone will forget all the good you do too.

Re:we need a "rogue tax-haven nations" list

[Feral Nerd]

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.

The British Virgin Islands are not a country, they are a part of Britain. The problem here in the specific case of Great Britain is that they pass tax law reforms and anti tax-haven laws but then ensure that these do not apply to "the colonies of the empire" (did I overdose on sarcasm? to be fair they actually call these places: 'British overseas territories' these days, not colonies). Britain for all it's officially tough stance on tax dodging is in the habit of passing reforms with one hand while digging loop holes with the other because their precious financial industry thrives on tax dodging.

Re:we need a "rogue tax-haven nations" list

[Tom]

there's no reason why we can't also have lists of "rogue tax-haven nations"

There is. The reason is that the USA would be on that list. Many US states are now tax havens, and that they eroded the banking secrecy of Switzerland, for example, has turned out to be just an effort to eliminate competition.

Re:we need a "rogue tax-haven nations" list

[fgouget]

Oh for fucks sakes.

The issue here isn't that companies structure themselves to minimize their tax burden, but the way taxes themselves are collected.

There is such a regulatory morass that goes with any tax code, and a never ending list of things to be taxed. The reams of paperwork devoted not only to the code, but the army of accountants to ensure compliance, and lawyers to finesse the gray areas of the code.

Isn't it fun how the same big companies that are responsible for much of the tax complexity(*) are now using it as an excuse for their tax evasion?
(*) Some examples: taxes on ISPs to help finance movies and public television; taxes on portable hard drives to help finance the movies and music industries; lower taxes on diesel to keep taxis, truckers and farmers happy; reduced VAT on various products to help the companies producing them, etc.

Re:we need a "rogue tax-haven nations" list

[Half-pint HAL]

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.

Yeah isn't it so unfair that if you go round murdering people, then everyone will forget all the good you do too.

I think you've managed to flip his argument right upside down. His point wasn't that we should turn a blind eye to Hamas's militant activities due to their humanitarian ones -- it was that we (quite rightly) don't, and that we should apply the same standard to organisations that support financial crime and stop using their legitimate activities as an excuse to turn a blind eye. If a foreign company actively advises its clients on how to break laws (the allegations against Mossack Fonseca are not just about technically-legal tax avoidance, but also about conspiring to engage in illegal tax evasion) then people shouldn't be allowed to do business with them -- funding international organised crime, and all that.

Re:we need a "rogue tax-haven nations" list

[drinkypoo]

There is. The reason is that the USA would be on that list. Many US states are now tax havens,

Isn't there a human involved in opening a bank account? Isn't their identity recorded?

Re:we need a "rogue tax-haven nations" list

[serviscope_minor]

I think you've managed to flip his argument right upside down.

You are absolutely right. I misread it somehow (the original is quite clear). I retract my statement.

Re:we need a "rogue tax-haven nations" list

[danbob999]

Some places like Delaware and Ireland are tax havens but they are also real places with real people living there.
Places such as the Cayman Islands and British Virgin Islands are places with almost no population and/or production and their sole purpose is to be a tax haven. Nothing of value would be lost if we stopped all trade with these entities. The worst would be the loss of tourism destinations but there are plenty of other islands to go to.

Re:we need a "rogue tax-haven nations" list

[danbob999]

It's already the case. Izz ad-Din al-Qassam Brigades is the military wing.

Re:we need a "rogue tax-haven nations" list

[drinkypoo]

Yes. And that individual can be your corporate lawyer who cannot be compelled to give your identity away, due to lawyer/client privilege.

OK, but there is a financial reporting structure in place that not only permits but requires banks to report large transactions. Large transactions to/from such corporations should be an obvious red flag. If the government is willing to seize people's cash then why not seize their bank accounts? If no one comes forward for the cash then it's theirs. If someone does, they can be charged with a crime. Seems like it's obviously something that they can do any time, and since the biggest criminals have access to offshore tax havens, there's no good reason not to. Look for it in the near future.

Re:we need a "rogue tax-haven nations" list

[cas2000]

I'd be more than happy to see corporate taxes simplified.

My proposal is a flat 30% of gross income. No deductions for anything - no exemptions, no offsets, no deductions at all for any reason.

you can't get simpler than that.

Re:we need a "rogue tax-haven nations" list

[cas2000]

Perhaps. i wouldn't have any objection to that, but i guess the real people who live there would.

Places like Delaware would be handled with the organisations list - legal and accounting firms known to assist with tax evasion would be listed, and dealing with them would be illegal.

If necessary, individual lawyers and accountants and other people could be named - and any company or business set up by them would be automatically added to the list (in addition to a lifetime ban on them being director or partner in a company). Sure, they could use patsies to "own" their new companies, but the supply of idiot patsies willing to go to gaol for them is limited.

Re:we need a "rogue tax-haven nations" list

[cas2000]

your "argument" (for want of a better word) is akin to saying that because some people get away with murder, we should never bother charging anyone with that crime.

Re:we need a "rogue tax-haven nations" list

[bingoUV]

Great, now define gross income.

Re:we need a "rogue tax-haven nations" list

[cas2000]

all income before ANY expenses.

Re:we need a "rogue tax-haven nations" list

[bingoUV]

Ok, unconventional definition - appears more like revenue than "gross income".

Some businesses deemed good for society by society - e.g. non-profits, cooperatives have zero or low profit margins. The society has decreed that they should pay negligible taxes owing to their negligible "income" - income as defined by common man, and benefit to society.

Banks, by the nature of their business, have very very low profit margins - the amount you deposit into "your" bank account is "income" for the bank unless the future expense of them having to pay you back is deducted. How would you feel getting at best 65% of your money back, assuming 35% corporate tax rates?

Re:we need a "rogue tax-haven nations" list

[cas2000]

are you stupid or something?

1. NGOs, charities, and other non-profits are not companies or corporations.

2. bank deposits are not income for the bank. they are monies held in trust by the bank. they do not own the deposits, which remain at all times the property of the depositor.

Re:we need a "rogue tax-haven nations" list

[bingoUV]

1. NGOs, charities, and other non-profits are not companies or corporations.

So do you mean to relax the rules for non-profits? I thought you said no deductions, no exemptions .... , for any reason? Suddenly you start exempting non-profits? How about cooperatives?

What if the non-profits start making these untaxed "benefits" but remain legally non-profits because the profits are magicked away by accountants? Currently they don't need to because one could as well do it as a for-profit company - just show much less profits on the books with accounting magic like Google, Apple, do in various countries. It won't be too difficult to use the same magic to vanish the profit completely and call themselves non-profit.

2. bank deposits are not income for the bank. they are monies held in trust by the bank. they do not own the deposits, which remain at all times the property of the depositor.

When I asked you to define income, you did not specify so many riders. What happened? Suddenly started feeling very exempting? A few minutes ago, you were about can't get simpler than that, and now one legal trickery after another?

So an advertiser in South Korea pays Google. South Korea doesn't have this "no exemptions" law, so Google safely transfers it to Google Ireland without paying tax. This $100 can be spent at will of Google US headquarters, but legally belong to Google Ireland so US cannot tax it. Now Google Headquarters decides to use it, so uses the money in Google Ireland to buy an internet startup company in Denmark.

One more company in Google US headquarters control without paying any US taxes. This is because of the "exemption" you gave to banks.

Re:we need a "rogue tax-haven nations" list

[cas2000]

1. no, as i said, they're not companies so why the fuck would you expect them to be taxed as companies. again, are you fucking stupid?

2. income already has a well-defined meaning (which varies slightly from jurisdiction to jurisdiction). why the fuck is there any need for me to redefine it - just so you can have some strawman to demolish? no thanks - you may be fucking stupid, but i'm not.

and as i said, money deposited in a bank is NOT income for that bank because it doesn't fucking belong to the bank. cretin!

3. how do you even manage to breathe and type at the same time?

Re:we need a "rogue tax-haven nations" list

[bingoUV]

OK, I'll go slow. One at a time :

What if the non-profits start making these untaxed "benefits" but remain legally non-profits because the profits are magicked away by accountants? Currently they don't need to because one could as well do it as a for-profit company - just show much less profits on the books with accounting magic like Google, Apple, do in various countries. It won't be too difficult to use the same magic to vanish the profit completely and call themselves non-profit.

Re:we need a "rogue tax-haven nations" list

[cas2000]

do you really need the bleeding obvious spelt out for you?

you make the penalties for such fraud so large for everyone involved (lengthy gaol sentences, huge fines, punitive additional tax rates, expulsion from professsional associations such chartered accountants, lifetime or least lengthy bans fom running a company or serving as a director, etc) that doing this kind of evil shit is far too risky for all but the stupidest of criminals.

the point of a simplified tax system as was proposed several posts back is to close exploitable loopholes, so why the fuck would it make any sense to leave a huge loophole like you're suggesting wide open?

that, btw, was a rhetorical question. which means that it doesn't require an answer.

Re:we need a "rogue tax-haven nations" list

[bingoUV]

Which fraud? The situation I described in the GP post was a completely legal one, though highly immoral one, under your definition of "tax all income before ANY expenses". Very similar to the tax loopholes Google, Apple etc. are deploying right now.

If there were "penalties" possible for legal but immoral activities, you wouldn't have needed to propose "tax all income before ANY expenses" - one could have directly prosecuted the "moral frauds", so to speak.

Re:we need a "rogue tax-haven nations" list

[cas2000]

tax evasion is fraud, you moron. Even the fact that their lobbying has corruptly caused some of what they do to be technically "legal" makes no fucking difference - it's still tax evasion, and it's still fraud.

I really have no more time for stupid people, especially morons who are pretending to be even more stupid than they actually are so that they can keep on advancing cretinously lame "arguments" and "counterpoints".

so, I bid you a heartfelt FOAD.

Re:we need a "rogue tax-haven nations" list

[bingoUV]

Ok, your temper tantrums show you need to be talked to in even smaller chunks.

Which tax evasion are you talking about, in the situation I described here ?

Re:All tax is immoral

[Anonymous Coward]

if you are not required to pay your part, then the gov't has no obligations to serve you. none whatsoever.
it's really that simple.

no tax= no infrastructure, health, schooling, law enforcement or anything really. want that backroad fixed? pay up. you're having problems with burglars? tough. hire a guard service.
broke a leg? pay up! ... oh wait, you already do.

Re:All tax is immoral

[KozmoStevnNaut]

Punish the wealth creators, and they'll stop creating wealth.

Considering all the wealth they create ends up in their own pockets, I'd say it's a fair deal.

Re:All tax is immoral

[bloodhawk]

The whole problem is they are not creating wealth, at least not in the countries they are siphoning money away from, they are doing the opposite. This isn't about punishing them, it is about creating a level playing field where just because you are a multinational that can move HQ into a tax haven that you can't gain a competitive advantage on local companies that have to pay their taxes.

Pay tax or bug out

[golodh]

Companies can bloody well pay their state taxes or bug out. Their decision.

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.

Re:Pay tax or bug out

[Dog-Cow]

Until there is a single EU tax authority, your analogy is nonsensical.

Re:All tax is immoral

[jandersen]

Punish the wealth creators, and they'll stop creating wealth.

Nonsens. Who do you think are the real wealth creators? The fat cats that sit at the top, skimming the cream off the labour of others without much effort? Or the people who put in a real day's work, whether they are called engineers, hi-tech entrepreneurs, farmers or manual labourers? All of these groups of wealth creators will keep working, because they have to, whether they pay taxes or not; if they don't, they can't feed their families. If your only contribution to society consist in siphoning un-earned money into your own wallet, then you are nothing more than a parasite, and the rest of us would be better off without you.

Re:All tax is immoral

[silentcoder]

The term "wealth creator" is basically a giant red flag that means "This person is an utter tool or a troll or both".

Dutch Sandwich and Bermuda Black Hole

[jsse]

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?

Re:Dutch Sandwich and Bermuda Black Hole

[vovin]

They refused to disclose the illegal bits (evasion) which are clearly not the bits everyone knows (avoidance).

Re:Dutch Sandwich and Bermuda Black Hole

[Nemyst]

If they actually wanted to solve it, they could simply make it illegal to perform transactions with entities located in Bermuda and other similar countries? It's not like there's much legitimate business being done through those places, and if the entire EU decided to block them, they'd have to change quick.

The Google workaround

[Coisiche]

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".

Re:"Fair share", my ass.

[Sique]

Which is why for instance in French, the word for "stolen" and for "private" are the same: privé.

Re:All tax is immoral

[Anonymous Coward]

The term "wealth creator" is basically a giant red flag that means "This person is an utter tool or a troll or both".

It is a term lifted from the writings of Ayn Rand and means somebody who strives to be utterly completely and perfectly selfish and most of all strives to prevent socialism, communism, and any other state intervention in society, that allows poor people to "leech" his hard-earned wealth.

Missing the point

[EmperorOfCanada]

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.

Re:Missing the point

[DogDude]

The local company can do exactly the same thing the big companies can. It isn't expensive; it just requires having enough incentive to act. I know individuals who benefit from the same loopholes.

Bullshit.

Re:Missing the point

[LynnwoodRooster]

No, he's right. It's about $1200 to $2000 to form an overseas company. And about $400-$1000 per year to keep it alive. If your taxes are higher than that - then you can benefit from incorporating overseas, and moving a significant portion of your profits overseas as well. Run your consulting business through that company, and pay yourself a small fraction of that - keeping most of your profits overseas. Have the HK company charge your normal $100+ / hour billing rate, and then it pays you, the lowly worker, the $30-$40/hour you want to actually make.

You end up keeping $60-$70/hour in Hong Kong that you can use for other purposes. Buying property, paying for research "junkets" overseas, etc. But the second you repatriate that money - you have to pay taxes on it (which explains why Apple, Google, and others keep trillions overseas).

I personally am a big fan of Hong Kong. They do not tax income earned outside the jurisdiction of Hong Kong, so if you never set foot in HK (and you do NOT need to in order to maintain a business there), you will never pay income taxes in HK - only in your home country on the income you choose to repatriate. And HK does not have a "sullied' reputation as a tax haven like the Bahamas, Seychelles, and Cayman Islands.

Who was the first?

[hcs_$reboot]

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.

Re:Who was the first?

[vovin]

This has been going on far far far longer than existence of google, or apple or facebook.
These tax havens have been running like this for last couple hundred years.
Just because it's being advertised now doesn't make it a new thing.

Re:Who was the first?

[Half-pint HAL]

They're all copying "meat-space" firms. Just the difference is that there's no physical product so they can export an even bigger share of their profits.

Re:Let's tax the Internet out of existence

[Anonymous Coward]

" murder people by the millions, cover up crimes and make all sort of perverted porn stuff." . hmm that sounds very muck like how the rest of the world describes the merkin homeland.

Re: "Fair share", my ass.

[silentcoder]

Well it makes even more sense comsidering the phrase is French in origin. Predates communism by about 2 centuries and was the original credo of classic libertarians.

Re: Let's tax the Internet out of existence

[Anonymous Coward]

Nah, the muricans have the murdering down pat, but they get their knickers in a twist over a nipple. The good freaky porn still comes from Germany, Holland and Japan.

Re:All tax is immoral

[Tom]

The ratio of wealth creators among the 1% is probably also on the order of 1%. Most of the super-rich don't create wealth, except for themselves. In my country, recent statistics say that 80% of the wealth of the rich (millionaires and above) is inherited.

Lots of the famous super-rich started that way. Gates parents were wealthy, and the Trump empire was built by two generations (not including Donald).

The real wealth creators are in the middle class. Not the one-in-a-million startups that make billion dollar IPOs, but the one-in-five startups that create a viable, middle-sized company and employ a dozen or a hundred people.

That is where wealth is created. And incidentally, it is also where taxes are the most heavy. Because all the tax breaks that are pushed through with your argument are always for the top.

Fair Share?

[chowderpot]

When you use terms like "fair share" in a headline, you are taking an editorial stance.

Re:"Fair share", my ass.

[Half-pint HAL]

Taxes are theft.

Lack of taxes is lack of theft, but the converse is not true.

Theft is a crime. Crime can only exist if there is a legal system. There cannot be a legal system without a public body. There cannot be a public body without public infrastructure. There cannot be a public infrastructure without public money. There cannot be public money without public income. The catchall term for public income is "tax". Therefore there can be no theft without tax.

(Strictly speaking, what I have said is not true. Fines and penalty charges are not considered "tax", but a society which generates any large portion of its public income from fines is not one I would like to be part of. That very quickly leads to an explosion in "crimes" -- see civil forfeiture in the US for example.)

Re:All tax is immoral

[fgouget]

Considering all the wealth they create ends up in their own pockets.

This is a common misconception and you know it.

Not so much when that pocket is an offshore account in some tax haven.

Re:"Fair share", my ass.

[Anonymous Coward]

Have fun when society collapses around your fucking ears then.

Re:All tax is immoral

[Half-pint HAL]

Punish the wealth creators, and they'll stop creating wealth. -- roman_mir

Oh yes, I can just picture it now. "What?!? I'm only going to get 3 gazillion megabucks? But I wanted 5 gazillion megabucks. Sod it all. I'm declaring insolvency!"

Re:All tax is immoral

[Half-pint HAL]

Whereas proper economic theory all revolves around creators of value. It's a far more interesting term, because you can be a value creator without making a penny in profit. "Wealth creation" is only apparent when someone can point to a stupidly high number somewhere -- how can there be "wealth" if no-one is rich? Thus being rich is painted as a virtue in and of itself.

What a surprise

[Dunbal]

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...

Complying with the tax code as written

[KenHansen]

...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.

Re: All tax is immoral

[KenHansen]

Bill Gates father was a lawyer, not a millionaire or billionaire... Was Bill Gates the beneficiary of many benefits having been born to a reasonably wealthy family? Sure, but he also was an entrepreneur in high school as I recall, having started a Traf-o-counter business before his semester at Harvard. The spoon in Gates mouth when he was born wasn't silver or gold, nor was it plastic - it was stainless steel.

Pay tax where business is done

[nycsubway]

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.

Re:Pay tax where business is done

[SmilingBoy]

Which earnings do you want to split? Acme Local Ltd in the UK has zero earnings! You want part of the earnings of Acme Global Corporation? Not possible, they have no business in the UK and no UK profits that can be taxed. Ah, those licensing fees Acme Local pays to Acme Global - it is all at market rate.

Re:Pay tax where business is done

[LynnwoodRooster]

That is, in fact, how it works today. You pay corporate profits taxes at the rate of the country in which you earned those profits. High-tax jurisdictions don't like this, though, because companies will shift their profit centers to those low-tax jurisdictions. And somehow that's "not fair".

I wonder how many of those bureaucrats clammoring for "fair share" tax payments refuse to take deductions on their own personal income, and ensure they pay at least 64% to match the highest personal income tax rate in the EU - all in the name of equality and fairness, of course.

I think Judge Billings Learned Hand said it best:

Over and over again courts have said that there is nothing sinister in so arranging one's affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.

Re:All tax is immoral

[unapersson]

Yes, a lot of it goes towards offshoring jobs.

"fair share"

[fche]

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.

Re:"fair share"

[DogDude]

When I use the throw around the phrase "fair share", including in this context, I mean that everybody should pay the same rate. Some companies do need to pay a hell of a lot more, because they're paying significantly less than other companies, true. But some companies don't have to pay any more at all, because they're already following the intent of the law.

Re:"fair share"

[fche]

That's more reasonable, good.
I wonder though - why "the same rate"?
What makes a proportion of profit (or income?) the natural tax amount, as distinct from e.g., an accounting of government services used?

Fine no tax then no fire / free ambulance / cops

[Joe_Dragon]

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.

Say

[rossdee]

Isn't Ireland (Eire) in the EU ?
They must have low taxes or why would so many US companies movr their KQ there...

Re:All tax is immoral

[ooloorie]

no tax= no infrastructure, health, schooling, law enforcement or anything really. want that backroad fixed? pay up.

Infrastructure, health, schooling, and law enforcement are paid for through local taxes, user fees, and sales taxes; they do not justify national corporate taxes.

Furthermore, the US has spent massively on European defense, so by your reasoning, US companies operating in Europe should get a massive tax break just for that.

Re:All tax is immoral

[jandersen]

And if those fat cats happen to have started a successful business and made it grow through good strategic leadership, are they still leeches siphoning un-earned money?

Look at your own question and tell me if you haven't already answered it. If you start a business and provide good leadership, does that not add value to the company? That isn't the same as sitting on a big pile of money and lending it out in order to skim off interest of the work of others.

Subsidiaries

[PPH]

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.

I wish

[JustNiz]

>> 600 million euros a year (nearly $700 USD)

I wish. I could retire on the change in my pocket.

Re:All tax is immoral

[CrimsonAvenger]

Punish the wealth creators, and they'll stop creating wealth. -- roman_mir

Oh yes, I can just picture it now. "What?!? I'm only going to get 3 gazillion megabucks? But I wanted 5 gazillion megabucks. Sod it all. I'm declaring insolvency!"

What I'm seeing is a lot of people looking at their 401K (or whatever equivalent retirement account system their country might have) and saying "Hey! Why is my retirement account growing 35% slower than it has been for the last ten years???"

Going after tax havens?

[LynnwoodRooster]

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...

Re: All tax is immoral

[dryeo]

William Gates II was a lawyer for the bankers and did well enough to put a million dollars in trust for William Gates the 3rd as well as send him to an expensive school where he had early access to computers and his Mother was well connected enough to get him introduced to the big shots at IBM

Panama Papers

[CanadianMacFan]

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.

Re:"Fair share", my ass.

[Opportunist]

You wanna make business in my country, you gonna heed the laws of my country.

But this ain't North Korea. You're free to get the fuck out any time you want.

Re:"Fair share", my ass.

[Opportunist]

How much do you pay for your protection? Your health care provider? How much for the roads you drive on? Having your own military protecting you must be really tough on your wallet too, how much is that if I may ask?

Re:"Fair share", my ass.

[Opportunist]

What pet causes would that be exactly? Police? Road maintenance? Military?

It may be news to you, but your finance minister doesn't put it in a huge money bin a la Scrooge McDuck to swim in it. If you want to find out what asshole you have to pay taxes for, find a mirror.

Re:All tax is immoral

[LynnwoodRooster]

For a couple of thousand dollars, you too can be a multi-national company with an HQ overseas in a tax haven. What's stopping you from doing the same thing? You can also keep most of your earnings overseas. Of course - just like the big guys - when you repatriate those funds you'll pay taxes on them, but that's at a time of YOUR choosing, not when the Government demands.

Re:Fine no tax then no fire / free ambulance / cop

[JesseMcDonald]

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.

Re:Fine no tax then no fire / free ambulance / cop

[Joe_Dragon]

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.

Re:All tax is immoral

[Godwin O'Hitler]

My signature sums up pretty much what I think. Let's reboot the Earth and then see where hedge fund managers fit into the list of indispensable jobs.
Contrived wealth.

No permanent solution...

[frank_adrian314159]

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.

Re:All tax is immoral

[KozmoStevnNaut]

Sure, if you disregard all the poor and homeless people scraping by in the gutters.

Re:All tax is immoral

[Tom]

Other sources disagree with Forbes.

For example, The Economist - http://www.economist.com/blogs... - says the formula is changing back, the low point was in the 50s, ever since the ratio of inherited vs. earned wealth has tilted back towards inheritance.

And The Wall Street Journal - http://blogs.wsj.com/wealth/20... - directly picks apart the Forbes article you quote.

Maybe the US or the world is not as twisted as here, I only had numbers for Germany when I posted. But the WSJ article is a good read.

Re: All tax is immoral

[Tom]

Given the 39% tax bracket that he falls under, he's writing the government a huge check

Please, who are you kidding? Gates made about 1 mio. in salary at MS. But he made 100-200 times that much in dividends.

let alone the fact that he's done more for the world than the government will ever do with that tax revenue

Locking the worlds computers into a monopoly, extracting monopoly rent from the market that could've been spent on R&D, damaging countless small, innovative companies with his business practice, dividing and preventing standardisation in multiple fields - shall I go on?

The Bill & Melinda Gates foundation is doing great things across the globe.

That is true, though there is some criticism aimed at it as well (driving out alternatives, monopolising its "market", etc), it does have a beneficial impact.

I've yet to find a statistically significant number of people who cry in favor of taxation that are also charitable in any sense.

Are you fucking mental? One of the most well-established facts of social science is that in share of income, poor people tend to give much, much more to charity then rich people. Generally, they overlap favoribly with the people who wouldn't mind higher taxes on the super-rich.

Re:All tax is immoral

[TsuruchiBrian]

Have you actually ever read Atlas Shrugged? The biggest villains are rich people. It's not like Ayn's Rand's philosophy is incredibly nuanced, but it's also not the oversimplification that her critics (who usually have never actually read her books) make it out to be.

Did Ayn Rand advocate selfishness as a virtue? Yes, but this was to be provocative, and her definition of selfishness was different than what most people would consider selfishness. But if you actually read the book, you'd see that the people who were actually selfish in the common sense of the word were all villains proclaiming to be selfless.

Should you read Atlas Shrugged? No, it's a terrible book. But you should read it if you intend to criticize it, so you are at least knowledgeable on the subject.

Re:All tax is immoral

[TsuruchiBrian]

If you want to treat wealth as a relative term (e.g. you only have wealth if you are *more* wealthy than someone else), and value as an absolute term (e.g. you can create value even if what you create is less valuable than what someone else created), that's fine, but I don't think that semantic distinction is widely accepted.

I use the two terms pretty much interchangeably.

I would say that people who have wealth are not necessarily wealth creators. A person who wins the lottery is wealthy, but didn't create any of that wealth, they just acquired it.

Also, I think it is fair to count consumption as wealth destruction. So if you create $100 of wealth/value doing your job, sell the products of your for $100, and then use that money to buy and eat $100 worth of tacos, you are basically "wealth neutral".

European going after American companies

[WindBourne]

The fact is, that the European companies hide as much or more taxes, and yet, the Europeans scream about Americans.
Just too funny.

Re:All tax is immoral

[morkk]

The majority of the 1% inherited their wealth and most of that wealth can be traced back to some extremely dodgy deal in the past. Eat the rich.

Re:All tax is immoral

[Half-pint HAL]

My point isn't about the technical semantics of the term, but about the psychological side-effects of it. "Wealth creation" can and does serve as a way of justifying being rich as a virtue.

Re:wtf headline

[Coren22]

understanding women

I have heard that if you come home from the bar smelling of cheap perfume, there could be some misunderstandings, but I have always heard that women are pretty understanding of most things. Now to just find women that'll date a single father...

Re:All tax is immoral

[TsuruchiBrian]

I agree that the term "wealth creators" and "job creators" are used for this purpose. All I am saying is that I think "value creators" could be used as well.