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France Will Tax Google, Apple, Facebook, and Amazon In New Year (qz.com)
An anonymous reader quotes a report from Quartz: France won't wait on the rest of the European Union to start taxing big tech. French finance minister Bruno Le Maire says the country will move ahead with a new tax on Google, Apple, Facebook, and Amazon starting Jan. 1, 2019. The tax is expected to raise $570 million in 2019. France and Germany had originally pushed for an EU-wide 3% tax on big tech firms' online revenues, in part to prevent companies like Apple from sheltering their profits in countries with the lowest tax rates. The deal, which required the support of all 28 EU states, appeared to crumble earlier this month, with opposition from countries including Ireland, home to the European headquarters of Google and Apple.
France and Germany attempted to salvage the deal by scaling it back to a 3% tax on ad sales from tech giants. That would effectively limit the tax to Google and Facebook, excluding companies like Airbnb and Spotify that might have been harder hit under the initial proposal. In the meantime, France is moving ahead with its own tax on Google, Apple, Facebook, and Amazon, which are collectively known in the region as GAFA. "The tax will be introduced whatever happens on 1 January and it will be for the whole of 2019 for an amount that we estimate at [$570 million]," Le Maire said at a press conference in Paris, the Guardian reported today (Dec. 17).
France and Germany attempted to salvage the deal by scaling it back to a 3% tax on ad sales from tech giants. That would effectively limit the tax to Google and Facebook, excluding companies like Airbnb and Spotify that might have been harder hit under the initial proposal. In the meantime, France is moving ahead with its own tax on Google, Apple, Facebook, and Amazon, which are collectively known in the region as GAFA. "The tax will be introduced whatever happens on 1 January and it will be for the whole of 2019 for an amount that we estimate at [$570 million]," Le Maire said at a press conference in Paris, the Guardian reported today (Dec. 17).
France seem to be literally broke, first carbon tax, that didn't work because people started yellow vest moment, well lets tax google and wholesale has money. Some serious desperation, Macrone and his grandma are marching to the guillotine
Google and the rest of these digital giants pay a 9.5 percent effective tax in the EU compared to 23.2 percent for traditional businesses. They can squeal all they want but a hike of 3% is not going to make me cry any rivers over Google's pain. I pay way more than a measly 9.5% of my income into the state's coffers. Counting indirect taxes, tolls and fees the state takes around half of my income in one form or another.
I think that is what they may want. Europe in general has been lagging behind the United States in terms of online services. Most of EU biggest tech companies are Industrial Technology (Siemens, Phillips, etc...) The Consumer Technology companies have a hard time competing against the Facebook, Amazon and Google. Primarily because they are so big, they can offer so many services so cheap that new competition will need boat loads of money to even be a threat. So making these products more expensive, it will open the door slightly enough to get their foot in.
We are in a time of a renewed sense of nationalism (Which I don't think is a good thing). But not just the United States, but every freakin country in the world seems to doubling down, protecting what they have, and preventing the "other" from coming in either physically, or with taxes and extra rules.
I expect this comes from the last Recession, because of the countries interconnection in trade that means stupid stuff done in America or China which you as a citizen has no control over, will affect your lively hood, and your countries economy. Now this works both ways, when the other countries does something good, you will also get its benefit as well. But the world is kinda feeling the pain from the last recession, and trying to lock out those "others" out.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
That's what you do when you're poor with finances and desperate: Steal from those who are better at managing their resources, and then pretend to be righteous about it.
That's an extremely shortsighted view of the world. Firstly, almost every person would accept the need for some kinds of public goods. We probably shouldn't privatise the military. Nor things like safety regulation and the court system. And if we need some things as public goods, then we need to raise taxes to pay for them. How we do this in an equitable way is most certainly open for debate. Which brings us to the second point: Whether you believe in some kind of natural justice or divine order of things, at some point if inequality gets too big in a democracy it is completely logical, and arguably inevitable, that the majority will vote to redistribute things. You can say this is stealing and unfair, but life is unfair (even for the rich). Many of the aristocracy during the French revolution probably found the whole situation extremely unfair.
So you either get rid of democracy, or you accept that there will be a redistributive force in the economy, probably through richer people paying more taxes. You can't have it both ways. Human nature does not allow it.
The problem with internet companies, is that our present tax system which did this redistribution in a generally agreed upon way, was not built to deal with their globalised, capital-light operating model. Most tax systems were designed for the pre-globalization industrial era of 30 years ago, when you couldn't just move money across borders with a few clicks, and any real business had huge tangible capital (factories, workers) which made it pretty hard to argue your centre of operations were on a tropical island.
The trouble is that fixing these quite legal loopholes (and you can't blame these companies for using them) requires cross border consensus, and many times the country benefiting (e.g. tax haven) isn't interested in do that. This is why individual countries are resorting to rather brutal 'revenue' taxes. You can't hide your revenue in a country, so it is impossible to escape the tax. In the end this is probably the best solution. The biggest problem with it is that a revenue tax, like VAT, is actually very regressive (the poor pay proportionately more of their income for it) so it may ultimately not be enough to calm everyone down.
But this is not a new wealth redistribution system. It is just a re-enforcement of the existing one. And trying to pretend we can have such a system without a negative feedback mechanism for inequality is magic unicorn stuff.
Bullshit.
You do business in a country, you pay tax in that country. Period.
Companies have been allowed to play shell games with where they claim the revenue is earned so they can pay as little tax as possible. But you can guarantee Google is making money off people in countries they aren't paying tax in.
The real wealth redistribution handbook is the bullshit playbook which makes sure the rich get richer, and the rest of us get poorer. It's time to stop following the unbridled capitalism wealth redistribution playbook, and stop making companies pay taxes.
The problem we have now is companies get to game the system and claim to not be making revenue from places when they clearly are.
Being a corporation isn't magical, and neither is being an American corporation. You do business there, you pay taxes there. None of those "oh, we don't have to pay taxes here" bullshit.
Lol the taxes aren't even going to pay for your services. They are going to pay for the interest on services rendered by our parents.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Force tax-cheating companies to cut their "but it is leeeegal"-bullshit and compete on equal terms as local companies.
Longterm, make EU close the loopholes that only profits big companies.
Any company that don't pay tax will of course be more successful than a company that has to pay tax.
This is like the Amazon thing about moving to Long Island City - it's not fair for everyone. GAFA in Europe have created jobs but have taken business away from other companies who just CANNOT compete. Taxes are way higher on smaller businesses. Google have got bigger tax breaks by headquartering in Ireland but really making revenue elsewhere. They also have operations and tax breaks from operating out of Luxembourg. All in all it's a direct tax on those companies to offset their (perfectly legal, but incredibly unfair) tax deals with various EU states which allow them to trade almost tax free IN OTHER EUROPEAN STATES.
Conversion Rate Optimisation French / English consultant
So making these products more expensive, it will open the door slightly enough to get their foot in.
So Trump proposes tariffs to do the same thing and it is the most irresponsible idiotic thing any leader has ever proposed.
A socialist does it because his groups of friends has so destroyed the French economy they are desperate to get more money, and NOW its a smart idea?
That what you can love about progressives. They don't care if the idea is good or not, it only matters who proposes it.
They are not taxing the US at all. These corporation make money in France and pay very little tax there. It's not fair, and this new tax is a good starting point. These corporations will be free to avoid France if they don't like the tax.
Only 23% in Europe? My company in the netherlands has to pay around 40% in taxes on profit, only foreign companies that wish to setup a company in the netherlands get to pay less taxes.
I think the 23% is an average after all loop holes and tax avoidance schemes have been taken into account. Another thing to consider is that the large majority of companies are smaller companies who do not have the resources to avoid taxes like Google/Amazon/Facebook/Apple and the likes can so they pull this average up. The big players pay way less taxes than small to medium businesses because they, unlike the little guys, can afford to hire entire financial services companies who dedicate themselves 24/7 to help the likes of Google to dodge taxes. I've heard figures of Google and friends paying as little as 2-3% effective taxes in the US.
If the taxing authorities go after the big tech companies hard enough, they will ultimately just abandon the markets trying to profit from their success. Think how great it'll be in France were Amazon/Google/Apple to abandon them--they would have to rely in China for tech and ultimately end up like N. Korea and Cuba with 20 year old technology and a thriving market for second- and third-hand smart phones.
When the taxes to do business in a market climb to a certain point, it's no longer profitable or worth the effort to service said market. And it's not like there are a lot of viable options besides Google (and technology partners) or Apple for mobile devices. Paying taxes is one thing, but what France and the EU are trying is more like pay-to-play or straight-up graft.
What's success? Europeans on average have longer life expectancy, better services, more vacation, and generally happier lives. Per-capita GDP isn't the only appropriate measurement of a country's success.
The yellow vests? At least the French have TIME to protest and their police and military aren't vile enough to pull Kent State II (as would happen if there were mass protests in the USA).
I'm pretty sure this is going to fall apart. France is trapped in the EU and this kind of decision will cause many issues if it's doing this on its own. It's never going to work IMO. Just sounds like a bullshit announcement. It's part of the announcements to calm down the protesters which amongst many things, protest against tax injustice. As the french government refused to reactivate the "rich tax" (ISF), this is done to compensate, knowing that they most likely won't be able to enforce it anyway. EU rules promote tax optimization. The rest is just comedy.
A tax on a corporation is a tax on its customers, not on its owners. The costs are always passed along. Not that I cry any tears for marketeers buying ads, either.
Fortunately for us in the US, bills of attainder are unconstitutional. You can't just tax someone you don't like, or because they have money. That was one of the specific things that led to the Revolutionary War (though the event that kicked it off was attempted confiscation of "assault weapons", as we'd call them today).
Socialism: a lie told by totalitarians and believed by fools.
A tax on a corporation is a tax on its customers, not on its owners. The costs are always passed along. Not that I cry any tears for marketeers buying ads, either.
Fortunately for us in the US, bills of attainder are unconstitutional. You can't just tax someone you don't like, or because they have money. That was one of the specific things that led to the Revolutionary War (though the event that kicked it off was attempted confiscation of "assault weapons", as we'd call them today).
They are not going after Google because Google is an American company that they don’t like. They are going after these corporations because they use public services but contribute next to nothing in return and what little they do pay in taxes they pay iin tax shelters and not the county where the profit is made. Critics of corporate taxation in the US have the exact same complaints of these same corporations over the same shenanigans.
They're going after them because they have money, and France needs money. Don't confuse the reason with the sales pitch. Meh, I guess if you look at this as a tariff on digital goods, it's a fairly normal thing for a government to do.
Socialism: a lie told by totalitarians and believed by fools.
They are not taxing the US at all. These corporation make money in France and pay very little tax there. It's not fair, and this new tax is a good starting point. These corporations will be free to avoid France if they don't like the tax.
They are big enough that they just might do that at some point. Be careful what you wish for ...
They are not taxing the US at all. These corporation make money in France and pay very little tax there.
Well, what one would say is... while Google earns money from French companies buying ads to display on their Google Search website: the amount the French authorities want to tax is an amount disproportionate to the amount of money Google makes in France. It looks like France wants to lay a tax on what amounts to 15% of their profit for the entire Europe, Middle-East, and Africa region.
These corporations will be free to avoid France if they don't like the tax.
Its not so easy.... these greedy countries are likely arguing that since Google's website is on the internet -- it therefore can be accessed worldwide, and therefore, always operates in France no matter what; French internet users can access their site, therefore the revenue from the ads displayed when their website is accessed remotely count.
not only their web site is accessed from France, but they sell advertisements to corporations and individuals based in France