Some commenters here declare that the US tech corporations " Offer " service in Europe . " Offer " ???
Google just sneaked out 20 billion euro out of Europe in 2019 without paying 1 Dollar of tax to the European community.
These 20 Billion euro ( 22 Billion $ ) did not appear in the clouds by magic. They were duely paid by European companies. It is advertising money. That 's what Google does : advertising, marketing and Google asks to be paid for it. You want to advertise and you put an ad on Google. You pay for it.I t is not free !
Offering service ! Some people are so inept.
If Google sneaks out 22 billion $ in one year without paying 1 $ in tax to the European budget it is stealing from European workers.
Those 22 billion $ were paid by European workers, by their work, by their production.
That is why Americans don't want to hear about Marx. They are so inept in economy.
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Americans have no idea of what is taken from them each time they go on internet .
That is why these corporations get away with the stealing and use of private data. because people are uneducated.
In Europe we have decided not to accept that, in the possible measure, and we wrote and voted a law to protect citizens against the appropriation of private data by private corporations and for profit pursuing.
Marketing is not a service , as some write it here. Marketing is a commerce. Are you agreeing that people come knock at your door and ask you what you eat, what you drink, what you read, what religion you are, what brand of mattress you sleep on, etc.. etc..That is basically what is happening with the US i=tech corporations , they even listen to your private conversations while you are on the phone ( the data is stored and analyzed ) and they sell that information to other private vendors to come back to you and target you according to what they know you like or not.
The American people, supposedly the defensor of freedom and Liberty are the most alienated people and they don't mind alienating other people and other nations for their benefice.
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Trade wars are easy to win!
I do not remember who said that...
Love the idea! No more shopping for the cheapest corporate domicile.
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No worries, legalized bribery will work its magic in the Senate and whatever the Tech companies want they will get. If it turns out Tech companies must pay higher taxes in other countries Trump, Mitch McConnell and the R-gang will lower their taxes in the US. And Chuck Schumer, Joe Manchin and the other faux, for the people democrats, will help out. After all, executives work very hard working the politicians and it would be unfair, even unAmerican to reduce their bonuses.
Such is life in our growing kleptocracy.
1
I invite Americans to do a little experience and sititng at a computer in the USA, go to Yahoo. France ( if they can read french ) or yahoo. DE ( if they can read german ), or Yahoo. UK ( if they can read English- the UK is still in the EU ) and they will see from the USA that they have to obey the European law , even if Yahoo is a US corporations, and same experience can be done with Google, you will have to sign in an agreement before being able to enter Yahoo. FR or Yahoo. UK , or Yahoo. DE , about accepting and choosing which private data you allow to be taken from you.
It is the European law. And even if you sit at a computer in the USA, you have to submit to the European law if you go onto yahoo Europe.
@JPH I want to add that Americans have no idea of what is taken from them each time they go on internet .
That is why these corporations get away with the stealing and use of parivate date. because people are uneducated.
In Europe we have dicided not to accept that, in the possible measure, and we wrote and voted a law to protect citizens agains the appropriation of private data by private corporations and for profit pursuing.
Marketing is not a service , as some write it here. Marketing is a commerce. Are you agreeing that people come knock at your door and ask you what you eat, what you drink, what you read, what religion you are, what brand of mattress you sleep on, etc.. etc..That is basically what is happeing with the US i=tech corporations , and they sell that information to other private vendors to come back to you and target you according to what they know you like or not.
The American people, supposedly the defensor of freedom and Liberty are the most alienated people and they don't mind alienating other people and other nations for their benefice.
By the way, there are two different issues to sort out.
First, there's the traditional one of where the economic activity takes place. For a century, the standard has been that if the production takes place in your jurisdiction, then the taxation privilege is yours.
The novelty of the Google-type industry, however, requires the old standard to be interpreted appropriately. European countries could argue at least somewhat convincingly that value is produced in Europe when a European consumer generates information by clicking at home (for information that is harvested and sold). Also, when advertising is presented and consumed at a European's home computer.
Secondly, there is profit shifting, which separates profits from the traditionally important place of production. Conniving governments have long enacted laws that allow this.
The novelty of patent-based industry has made profit shifting easier by redefining a patent, which is a government-created monopoly that raises financial returns to productive assets, to be instead an asset itself ("intellectual property") that receives income like a productive asset but that unlike productive assets can be relocated costlessly without affecting production, allowing the firm to receive its income anywhere that is convenient for taxes. That was Apple's play in Ireland.
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@Joe Ryan It is not only intellectual property. It is solid tangible objects being sold. Apple, Amazon, Starbucks, Netflix, and others actually sell objects, lao tops, iPhones, coffee, pastries, amazon sells everything in Europe and yet pays zero taxes. Mc Donald' sells hamburgers in france and pays zero taxes . The second clientele after the US is France.They all cheat and pay no taxes. And they actually act as if they were European companies, and not American businesses.
Cause ... EU has lost all over its advertising prowess. Effect ... EU taxes those who took all its advertising prowess.
Simple cause and effect.
Can someone tell me the role and purpose of a tax? Why do we collect taxes?
Isn’t taxes to pay for infrastructure, fund common defense (military), and bankroll the countless government employees? That’s why you and I pay taxes, because we benefit from those services and therefore have to pay for them.
But if these companies come in to the EU to provide serv that people value yet are located in another country, why should they be asked to pay for roads that they never use, fund common defense that doesn’t protect them, and bankroll a government that doesn’t serve them?
Sounds like the bigwigs in France/EU are drooling just thinking about all the money these companies are making (from their own effort) and wants a piece of the pie.
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@Laura You have the wrong view. All the US corporatiosn based fiscally in Europe use infrastructures, they hire employees who have health insurance, according to french law, they have children that go to free universities according to French law, they listen to France Musique public French radio ,paid by French tax payers, etc, etc..
You seem to not understand that the world is not only US business.
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@Laura These companies provision of services in the EU would not be possible without the infrastructure of the EU (highways, data networks, a military to guards against invasion and market collapse) which is currently paid by everybody in the EU other than foreign tech companies. It's perfectly rational to charge these companies for their being able to benefit from this infrastructure.
2
In France, we have health insurance since 1949, for everybody.
Now 35hour/week, 5 weeks paid vacation for everybody. retirement plan for everybody since the first month you work.
Free education for everybody up to university and 10 year study to become a surgeon or engineer, or lawyer, doctorate, etc..
All US corporations employing French citizens in France have to comply with those laws.
But if they cheat or refuse to pay taxes, who pays for the education of the children of the employees of Apple, facebook, yahoo, Google, Starbucks, etc, in France ?
Who pays for their health insurance, since it is not all paid by employer/ employee participation ? Who pays for all the social structure if the US corporations don't pay taxes ? Who pays for the infrastructures, the airports for Amazon to ship merchandise, who pays for the roads to maintain/ tec..
The answer is : the other French tax payers have to pay for the US corporations to have the right to conduct business in France in conditions that they don't respect.
Americans cannot behave in other nations like if they were in the US with US laws.
If they want to participate in the European business market, or in France, if they want to make a profit with the French market and French people, and French infrastructures, they have to respect French laws and participate in the maintenance and taxes like everybody else.
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As US corporations in Europe cheat on the declaration of their benefice, that is the reason why France, and Europe before , since it was a global European project before Germany backed out, decided to tax on the volume of business, not on the profit.
The profit is easier to cheat on. But when you see that Apple sells that number of lap tops or iPhones you know how much volume and money they make.
even if they cheat by saying like Mc Donalds : we are not making any money in France , there fore we don't pay taxes.
Mc Donald 's France is the biggest clientele after the US.
or we know that Google repatriated 20 Billion dollars in 2019 without paying 1 $ tax in Europe.
Now Google will be taxed 3 % on those 20 billion dollars ( for the part of volume or France ) , instead of cheating and saying .we don't make any money we don't pay taxes . And in the back we send 20 billion dollars back to the US through secret venues in half illegal ( for France ) banking routes via London and the Caribbean off shore US banks.. !
What is legal in the US is not necessarily legal in France. Americans have to stop behaving like they own the world and they do everything elsewhere as they do at home or as they think it is legal to do or cheat.
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Google, Yahoo, Facebook, have stolen all the advertising and marketing in Europe. The EU had to create a law because they were also stealing private data without citizen's consent. Now when you go on Yahoo France yoy have to sign in an agreement in which you can choose how your data is shared.
try it and you will see.
of course the US corporations used an army of lawyers to fight against that law and lobbying as well.
Amazon is taking over all the retail business.
It is like if BMW and Mercedes had taken over the whole car market in the USA . destroyed all the US car manufacturers. And cheated to pay zero taxes on top.
BMW and Mercedes are in the US car market and they pay taxes honestly and share the market with other brands. they don't try to take over like the Americans do in Europe and they don't respect European laws.
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This was coming since several years.
It looks like American journalists never read the European press. They probably cannot read French or German and they don't bother getting interested in European problems as most Americans do.
On the contrary, European journalists read the US press every day.
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To Jeanne who writes "How about multinational agreements to raise taxes on corporations until they have no where to hide or shelter'"
Ireland would not agree. Too much money at stake
In a global economy, taxes as wages are a race to the bottom
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@Lisa Ireland would have to agree if it was the law. As the EU forced Ireland to charge Apple with a tax fine last year.
The problem is the cheating use of loop holes that are previously made to benefit small companies and are used by huge corporations .
it is like if you show up with a fake ID to benefit from a price for children or senior . That is basically what is happening.
We don't want and cannot remove the price for students but we want to fight those who cheat to go to the opear by pretending they are students when they are rich businessmen.
Sorry folks . This has nothing to do with Trump. The idea has been around for DECADES in Europe - given its glacial pace it just took a while
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Decades? Even when digital revenues were tiny? And Europe has been faster to act on a range of matters related to tech firms - including anti-trust actions and legal rulings, data protection for users, now fair tax - than the US government, which seems frozen by comparison.
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3% is a rounding error or these companies. They doth protest too much.
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Because the most important thing to our government right now is to eliminate all taxes on corporations!
This is your tax dollars at work..... Saving the billionaires from their fair share of taxes.
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Sell, sell, sell,
Sell everything you stand for...
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Good! It is time that international companies, especially "internet" companies pay taxes on the goods and services they provide to the citizens of a country.
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I see that few NY Times readers understand taxation
Corporate Taxes, Econ 101
1. Corporations, per se, do not pay taxes. They collects
them for the government
2. Corporate taxes are paid by
a) Stock owners, in form of lower dividends
(this may include your pension plan)
b) Employees, in form of lower wages
(from CEO down to ware house worker)
c) Consumers, in form of higher prices
Economists disagree on which fraction pays what, but most
believe that with the withering of Union power ("If you do not like our wage offer, we will move operations to Mexico")
employees pay is now the largest share in form of stagnant wages
Cutting dividends would send down the stock price, and raising prices is difficult when competition with lower wages is around. And it is. Alibaba, in Switzerland, has 30% of the sales of Amazon, but is growing 5 times faster
Read "Alibaba bereitet Schweizer Online-Händlern mehr Sorgen als Amazon" (NZZ, 21.12.2018) -( Alibaba poses more problem to Swiss on line merchants than Amazon)
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A reality check.Companies pay the lowest wages that they can without losing out to the competition for the staff that they want, and they charge the highest prices for their products that they can without losing more in sales than they gain. There is simply no evidence that corporation tax rates lower wages or raise prices. And most tech firms pay little or nothing in dividends. I thought everyone knew that.
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@Woof you must have won a lot of debates in jr high with your erudition.
Your winning theory means that every Corp that pays a portion of their net revenue to our Federal government is being a poor fiduciary on behalf of their stakeholders.
There used to be some honor among thieves that it actually benefitted them to pay taxes to keep a plausible infrastructure, defense, education operation in place as a cost of doing business in a functioning market.
But greed has taken the place of honor and with the overwhelming rewards placed at the feet of those who work tirelessly to evade regulation and taxation it is no surprise that we are where we are.
You can cite this line of reasoning that paying corporate taxes would diminish Amazon’s stock price, or reduce employee pay. Certainly not executive bonuses.
I would counter that Amazon should be forced to pay a use tax on every delivery, every employee they hire who went to public school, every Internet transaction that is using government created or regulated technology infrastructure, every piece of steak and potato they sell at Whole Foods that is USDA inspected, every Megawatt generated by public dams, the list goes on
Oh, and should the US ever need to defend Amazon and / or their business interests / assets abroad, sorry Jeffy, out of luck.
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@Woof "Corporate taxes are paid by
"a) Stock owners, in form of lower dividends
(this may include your pension plan)"
So? The cost of taxation is no different from any of the other costs of doing business that stock owners pay for. Many have no pension plan other than Social Security and these people could use a boost in retirement income.
"b) Employees, in form of lower wages
(from CEO down to ware house worker)"
I've yet to see U.S. CEOs take significant cuts from their grotesquely large salaries, bonuses, & stock options.
"c) Consumers, in form of higher prices"
Consumers should be paying for the cost of whatever product they're using.
In the U.S., we've lost a sense of civic responsibility and the committment to democratic decision-making as to the use of commonly-shared resources and services. Instead, we increasingly rely on arbitary and non-democratic decisions made by billionnaire philanthropists who fund their pet projects and are then lauded for their generosity. Far better, surely, would be to tax their businesses fairly and appropriately and decide as a society what to fund and what not to fun.
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"America First!"
"Wait, are you saying we need allies to form international agreements so every country doesn't have its own complicated system? Oh no!"
2
Tax away! Facebook and Twitter wreak havoc on our lives - fake accounts, platforms for subversion, bullying, and hate. They are run by narcissistic people who contribute little to society. The US should be taxing them and other corporations who use their wealth to hijack our elections. Taxes can be used as a stick to ensure responsible behavior. The tables are turned - look at the US using sanctions to destabilize and impoverish foreign governments.
6
Anyone shaking their head disgustedly at Europe is part of the problem. Just because these companies make their billions in the crowd does not somehow make those billions less taxable, more benign of less disruptive/keeling of the economy the rest of us have to live in.
Vive la France!
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@Lex Should have been "in the cloud", apologies.
People better wise up on the idea of corporation taxes being raised by ant significant amount. Every retirement plan is invested mostly in stock. If companies make half as much, the companies are worth half as much, and stock is worth half as much. That would mean most retirement funds invested in stocks would be worth half as much. Everyone ready to get half of their pension? I didn’t think so. BTW, cities and states will quickly be forced into bankruptcy. Massive individual tax increases would be the only solution.
@Jay That is an incredibly self-first viewpoint. What about the residents of the country where the corporate taxes are applied? They will gain as much from the raised corporate taxes as the stockholders lose. And explain to me again why it is stockholders should take priority over the local people with whom these tech companies are doing business in Europe? Your comment is economic imperialism.
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@Lex. What about the residents here? The US should impose reciprocal taxes on European, or any other country that does the same. Is that how you want the system to work? I’m all for it.
@Jay What pension?
We ordinary US Tax Payers grouch when we hear some large company has moved their legal home off the US land, completely motivated (as evidenced by small, frequently unoccupied offices) to escape paying any US tax at all.
Now large established countries are trying to gain the tax revenues they are legally entitled to, and the US complains that the countries are just trying to get their legal, fair, share?
We can't believe that the country's best interests are being held forth by any attempt to negotiate a deal on this.
These are not struggling companies, hanging on by a thread. The list has the most wealthy companies and owners represented, and likely wouldn't be hurt by paying the tax that a common sense approach would conclude they are supposed to.
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"A Treasury spokeswoman said the tax treaties were a priority for Mr. Mnuchin and Mr. McConnell and that the Senate’s bipartisan work on the issue would fuel economic growth."
Yes indeed, everything they do is always to "fuel economic growth." At whose cost?
4
Our wonderfully managed governments are broke. They are going to get revenue somewhere.
5
Another example that is not cited in the article is Starbucks.
Starbucks is not declared fiscally in the USA . It is fiscally a European corporation hiding under multiple fiduciaries in Ireland and Luxemburg finding ways to conduct business in Europe without paying any taxation. Like this Starbucks is transforming the landscape and the culture of Paris and France by buying lots of traditional cafes and brasseries because the owners of these French businuesses have to pay taxes so they cannot compete against a multi billion dollar American company that does not pay taxes in France and the get real estate cash offers . They sell.
Little by little traditonal cafes in Paris close and are replaced by Starbucks carboard and sterofoam mass selling fake drinks that come back from the USA by the export of the European culture.
25 years ago in the US nobody knew what an expresso was, even less a capucino, you could not find a cafe that would serve that.
Now American companies, after having copied the European culture fro profit are coming back to Europe with dishonest fiduciary activities to destroy the European culture. Which is not only a product ( expresso, capucino ) but areal culture of sitting in a convivial place, and communicating . And not polluting , because a traditional cafe uses washable porcelaine cups. Starbucks uses disposable ,plastic, paper , sterofoam, petroleum products ,etc non renewable energy . Very polluting.
And the products are not the same fresh quality.
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@JPH My comment was too long , I had to cut it. But there is another aspect which is the quality of food and communication .
In a traditional French cafe or brasserie, there is a kitchen with people working to cook dishes with fresh products : a steak frites, or a fresh salad, even may be a duck leg dish .
You can ask the waiter for the steak to be rare or medium, you can ask for a half side of greens and fries, you want your salad with the dressing on the side or no olives or capers, etc, etc. The cook has bought the meat and the vegetables, salads fresh the same morning or the day before. If it is a busy place ,you can be sure it is fresh. And it also supposes that the whole farming process behind has to attend to that small fresh delivery daily. You can have a plate of Oysters for 10 euro in a brasserie.
The food that is served at Starbucks is all made for all the stores in a factory, days in advance, then it is delivered to the store to be put in a window for sale or reheated in a microwave . Can you ask for your steak rare ? no Oysters ? no. salad with olives and no capers ? no . salad fresh ? no.
And the farming industry that operates to mass deliver to Starbucks for a whole region or country is not the same farming industry that attends to the fresh need of a French cafe .And you can add that for everything : the bread , the wine, the coffee , the olives, etc.. everything.
Starbucks is not only destroying the French culture, it is changing the whole farming process .
2
@JPH
If you had worked in a high-volume kitchen or been familiar with the restaurant industry, you'd know that the days of people making everything fresh are long gone. Yes, even in France bulk food distributors exist to deliver ready-peeled frozen potatoes, ready-made frozen croissant dough and other brasserie essentials.
The romantic impression you have of brasseries only exists in small out of the way places. For the rest of Europe it was long gone, way before Starbucks set foot in Europe.
@Viv It is not true. In France food is still prepared fresh. In most good places.
Your argument is false.
On the contrary in France there is a trend to go back to everything fresh.
I am not talking about the big restaurants in touristy places.
And it is not a romantic vision.
And that 10% tax cut for the Kentucky business will go directly into the bonuses earned by the corporate bigwigs. It's the American way!
4
France has taken a good stance. It's you other people come up with an agreed-upon tax scheme, we'll join in and repeal ours. Your move.
4
@uga muga It's rare that France does not take "a good stance" (-:
It’s time that these businesses pay their fair share of taxes based on their revenues and not their “income” which they and their paid legions of tax lawyers can manipulate and game. Much the same can be said for other businesses that utilize public ally provided educated workers, roads, markets, and research (where do you think the internet came from) to generate their profits which are then used to buy the politicians to allow them to exclude competitors, conduct their predatory business practices and turn their business models into rent seeking monopolies.
8
The quaint saying "what's good for the goose is good for the gander" come to mind.
When we muscle in trade tariffs, threats of sanctions, tangible sanctions, unfair trade practices as well as frequent undiplomatic and arrogant behavior, some countries will find ways to retaliate legally.
As for Mr McConnell's alacrity and receptivity to lobbyists...always look for the money.
6
The Trumpsters think they can do as they wish and that the rest of the world must play by US rules. I hope Euro governments tax American tech companies until they are willing to take responsibility for the hate on their platforms and are willing to make significant changes to their business models so that fascism and authoritarianism are smothered.
3
Did France's tax thing catch the US by surprise? Did the US not know this was going to happen?
1
Don't retaliate. Accept the tax.
3
Let's hear the screaming and shouting against "trade wars" when the Europeans invoke ones like this, that's as loud as the Left's one against our corresponding actions against China.
I'm not holding my breath. It always seems that the screaming from the Left is against the USA, and only us.
Trump is at least trying to do the right things here: put America first. Just like Europe always puts Europe first.
We need to continue to stop being patsies, and make Europe the big patsy.
1
@Doug McDonald Dividing the world up into two nice and easy-to-understand mutually exclusive categories of "left" and "right" so one can sling mud at the other like kids in the schoolyard or football fans in the bleachers never led to much in the way of increased understanding. In 2019 it's a dinasaur of a thought process.
Trump picked up the trade as the populist issue and has embarked on dismantling the global economic order. Because of economic hegemony of the US, he has gotten by in the initial rounds, but chickens are coming home to roost. Since all things come to an end, perhaps Trump's presidential legacy will be destruction of US hegemony in the global market making America an isolated country with only Putin and Kim Jong Un only friends left. What an irony for the Republicans!
1
If Chickens are coming home to roost how long before the US drops the fifty years old Chicken Tax.
The Tax that ensures Americans drive trucks the rest of the World wouldn’t buy at half the price.
3
This is probably the model the world should look at for taxing firms that essentially dodge national taxes. If you do business in France, collect money in France, you should probably pay taxes on your net revenues in France. I'm surprised that the penguins haven't struck a no-tax-but-extra-fish deal for everyone to relocate headquarters to Antarctica.
Oh sure the Saudis can chop up an America resident and journalist but taxing an American firm in France - an outrage!
8
They should be taxed....and quit whining given that their "profits" have been largely built on content that was created by others (that aren't compensated).
6
McConnell will actually consider treaties that have been negotiated under Obama?
This must be a The Onion article.
2
Tax evasion by the wealthy, be they individuals or US corporations, causes the U.S.'s citizenry's enslavement.
4
All corporations, tech or otherwise should be shakin' in their boots! What if the global populace wisws up and instead of a race to the bottom om taxes, we reverse that. How about multinational agreements to raise taxes on corporations until they have no where to hide or shelter.
38
@Jeanne Prine Brilliant thinking . . . three to five years of robust tax collections followed by decades of stagnant growth and unemployment. How have the American people forgotten that business is the foundation of our prosperity. Duh . . . .
@AR Clayboy
Utter nonsense. Your "logic" would suggest thet the USA was an economic hellscape in 1950.
Thanks for playing though!
1
When American companies like Amazon pay $0 in taxes back to the American people, our economy has failed. They have benefited from the framework our country offers them, but for no return to be given back is illogical and weak on the part of our government.
The E.U. is apparently the only one who understands that these trillion dollars companies can afford paying taxes, while the US government grovels at the feet of Amazon, Apple, Facebook, etc. For the US to be pushing trade policy on the E.U. based on lobbying interests in Washington is equally pathetic.
When will we get our act together?
46
@Alex in my opinion the USA is on a path to becoming a lot like Mexico where taxes are low, government services like policing are poor to non- existent, infrastructure, where it exists, is old and crumbling. Companies create jobs but they are jobs without benefits, living wages or even a degree of permanence. They avoid taxes yet they reap the benefits of a mostly civil society and it’s institutions.
When Ronald Reagan and his propaganda machine sold the ludicrous concept of trickle down economics to Americans, he drove another nail into the coffin of the American Dream. Marie Antoinette wouldn’t even make the evening news in today’s America.
15
@Timothy Indeed. With no examples that prevailing orthodoxy has ever worked as claimed (endlessly lowering taxes especially on those most able to pay them painlessly produces untold wealth for everyone), just how long will it take for U.S. voters to conclude that the emperor has no clothes? One could apply to the whole population here the oft-quoted definition of insanity as continuing to repeat the same behavior over and over again while expecting a different outcome each time.
3
Republicans demand deregulation and smaller government, but then choose this particular fight to meddle in? I missed the part of this article that explains why I should care if these tech giants pay more taxes globally. They are already not paying their fair share/or investing in our communities here in the US, meanwhile my effective tax rate is double theirs.
signed ~Non-Sympathizer
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@BevAn But do you have full-time lobbyists in D.C. to instruct Congress on how to implement your wishes? I thought not! 9-:
Good for France! But doesn't this raise the question of why these companies are not paying any (or very little) U.S. tax? American citizens should be asking their legislators! They are making billions. They use the U.S. and state infrastructure, they stash their profits overseas and get a free ride on the U.S. taxpayer (besides exploiting them for their personal data).
Elizabeth Warren is right. They need to be broken up.
13
This was exactly my first thought. Good for them! These companies have been coddled by the US Government for far too long stashing their profits overseas and leaving the middle class to carry the tax burden for the US Economy. Imagine what our schools could look like if we had the tax revenues from Google or Facebook to Apple or Amazon that are paid dutifully by any other law abiding business owner!
4
@Joe Markert Instead of taxing them, we laud billionnaire philanthopists' "generosity" when they hand out crumbs to non-profits to fund their personal interests.
The French tax aimed at all ( not only US corporations ) businesses of more than 250 million Euro or 25 million in France was not only a French tax at the origin.
It was a European projects . But the law failed to be voted in the EU parlement mainly because of the German default on the vote.
Because the Germans have a big market in the USA , for which they pay honest taxes, they were afraid of the retaliation of the USA against their business in the USA . They refused to vote the law at the European level.
France and the UK and I am not sure who else found themselves obliged to create a national policy instead of a European tax law that failed because of the Germans being cowards .
It is sad that the American citizens are not informed by the US press about this story that concerns them.
The reason is , that, now , the French tax appears like it is coming from nowhere and Trump can say it is dishonest .
But there was a whole historical process behind it and France was not the only nation pushing for it.
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@JPH "It is sad that the American citizens are not informed by the US press about this story that concerns them." Since when were American citizens informed about anything of consequence by the US press?
@Philip You are right. We are doing the job here informing and giving facts or explaining.principles After a disastrous article that is misinformed and giving false image to the public.
Frankly, these information trading trust like companies are mostly rent takers not wealth creators, and taxing them hurts nobody. The internet is an open space for the exchange of information and a marketplace. That is all it happens to be. Social media is nothing but a space for gossip and conversation. It’s a tea party and the water cooler, and the Friday night get together after work. They use public infrastructure, squeeze out innovative small companies, accumulate wealth by their rent taking and use it to takeover paying businesses that do make new wealth, and generally make lots of money with paying their fair share. Being a cleverly unproductive and getting rich by it is their business model.
5
Europe can't raise revenue without taxing our companies. Any European country would kill to have a tech powerhouse like Google, Apple, Microsoft, etc. And now we have politicians in the US like Bernie Sanders that want to strangle the model of economic production that brought us these firms. So tell me, who are we going to look to for innovative companies we can steal money from?
1
@Tom
Just because a company is innovative does not mean they shouldn't pay their fair share.
@Tom lets start with Amazon which pays no taxes!
What world do you live in where people stop working or stop innovating because they have to pay a tax? The market can not provide everything needed for society or even for businesses.
3
The tech industry taxation is out of control around the world, including here in the USA. But of course, our government is only beholding to stuffing congressional pockets to do what the tech industry wants to do - make gobs of money without taxes.
4
I commend Europe for at least asserting the sovereignty that they have. Tech overreach is a completely optional phenomenon. Democratically elected government can oversee it to any degree that may uphold the values of voters.
3
How many people know that US citizens who are living abroad (which includes Canada) are taxed just like everyone living in the US?
That sure seems unfair, eh. It must seem unfair to all other countries since the US is the only country to do so.
Really unfair to argue this week that Google and Facebook should be taxed based on the location of the company but not US citizens.
(Some but not all of those taxes are corrected for what the person pays in local taxes in some foreign residencies.)
Unfair, immoral, and bullying to tax citizens around the world, and this week, disingenuous too.
1
@Ben Yes, of all the weird things the US does compared to the rest of the Western world (from not giving free health coverage to all citizens to not asking for an ID when voting), taxing Americans living and working abroad is one of the strangest. When my American friends in Norway tried to explain me this, I couldn't believe it.
1
@Ben Actually, the US (and Eritrea...) is way ahead of the world in terms of individual taxation worldwide.
If only the US would close loopholes on capital and real estate income, millionaires and billionaires could not hide anywhere (thanks to FATCA and other complementary laws), unless they drop their US citizenship which means all sorts of trouble with immigration and the IRS if they come here too often or maintain significant US assets.
2
@Joseph There is an argument to be made for citizens overseas to pay for things like consular services that, in the case of the U.S., provide a wonderful array of services to US citizens around the world. But I don't see why such citizens should be assessed at the same rate as US residents - why should they pay for services and infrastructure that they don't use?
What on earth is wrong with taxing corporations for the vast profits they make? In the same vein why should making money on money be exempt from taxation? Why should off shore shell companies get away with shirking taxes?
As a free lance artist, I have lived below the poverty line my entire adult life. As a low income senior on social security, I pay taxes on my paltry stipend and I am happy to do it because I drive on roads, I use the public health system, and my grandchildren go to excellent public schools.
If corporations are people, they need to pay taxes like people. That this is the kind of bi-partisanship the Democratic and Republican leaders can get behind, speaks volumes to the allegiances both parties still have and will have, no matter what the electorate wants.
THIS is what both parties can agree on? I expect that from the GOP but the Dems? Shame on them. The electorate is screaming for social justice, supporting progressive candidates who they hope will have their best interests at heart. Meanwhile the behemoth that is the establishment sits fat and happy knowing nothing will ever change.
9
i think the tax should be on high emission, high cost, small passenger cars = 100% tax
Porsche and Ferrari. Everyone can pick on the suburban mom with 4 kids and an in-law driving a Yukon, but let's the 1 guy toxic rich guy (who probably doesn't pay taxes anyways) pay a bit.
Also Cruise ships and and yachts - 1 cruise ship = 1M cars in rush hour! , as they have less people. ECO Tax.
The times they are a changing to paraphrase Bob Dylan. Digital transactions occur over the internet are impacting all countries, everywhere crossing national and state boundaries. The question is how to tax a transaction occurring within the taxing authorities boundaries. National, state and local authorities have been wrestling with the question of taxing Amazon, Google, etc. without harming their own businesses. As more brick and mortar storefronts are replaced by faceless digital entities this question is gaining increasing importance. If the money is flowing how does a government get its share to provide services? Today we see the French stepping out to tax internet transactions. This is not unexpected or anti-American rather just another necessary way to garner income.
10
@ek perrow yes . If you buy someting on iTunes or Apple store , from the USA, it is declared as a sale in Luxemburg, because the American tax lawyers from Apple have found a trick to use a tax loop hole in Luxemburg ( for exemple a tax incentive for small innovative companies ) to cheat and pay zero taxes . The lawyers will find ways to make Apple activity look like a multitude of chameleons pretending they are those small innovative European companies that Europeans are trying to help to fight Apple's monopoly ( ! )
Then, once they found a way to benefit from the tax loophole, they rechannel the cash without taxation back to a fake gathering bank in London and send the money back to the US through secret paths . "Ni vu ni connu ".
2
Before Google and Facebook came along companies advertised their products in newspapers, theatres, on billboards and the like. All the local French companies had a share of that advertising revenue and paid tax on their profits to the French state.
Then Google and Facebook and all the other worldwide platforms arrive and take an ever increasing share of that advertising revenue and pay no tax on it.
Who then pays the tax that used to be gathered? The ordinary French taxpayer.
Good on them for taking back some of the tax that is being paid by French people that used to be paid by French companies.
If all the sales are made in France but none of the income is declared in France then the only thing a nation can tax is sales.
15
Corporations have to pay taxes in the country where they are domiciled. If Europe wants to upend the norms of the global financial system, the US should tax all European companies doing business here.
@Pat The US corporations are not domiciled in the USA . They are all declared fiscally in Europe.
All of them : Apple, Facebook, Amazon, Google, Yahoo, Starbucks, Netflix, and others .
They hide under fake fiduciaries like shipping companies hide under fake pavilions to avoid paying taxes in their nation of origin where they are making profits ( greek shipping companies declared under Panama flag but in London banking )
12
@Pat Europe isn't upending the norms of the global financial system. That occured with global digitalization. Europe is simply responding appropriately to that change.
Companies like Walmart and Home Depot do not get to avoid taxes. About time the big tech companies paid their fair share of taxes. Republicans are just worried that Dems would get a new excuse to collect taxes from these free-loading companies.
6
@amjo Your wrong about that - they get to avoid income taxes too. Once a corporation goes international and forms foreign subsidiaries, the profit shifting tax avoidance begins.
2
@Nancy yes, you are so correct.
@amjo Walmart does get to avoid paying a living wage resulting in many of their full-time employees being eligible for food stamps. Corporate socialism at its best! American taxpayers subsidize the income of the nation's richest family- the Waltons.
The Trump Administration likes imposing trade tariffs without much consultation, but when other countries do the same it's an outrage. A few years ago there might had been a behind the scenes negotiation before hand, but not with the current toxic trade environment. You reap what you sow.
14
@Jgrauw: One wonders how many more Lilliputians Gulliver Trump will crush as he thrashes around.
1
I am waiting to see if Trump can start an effective retaliation against France. Of course, he should have no gripes because our big tech companies do make a lot of money in France. Based on the track record he is dealing with China trade war, I think his reputation as a good negotiator is already tarnished. In real estate business, he can bluff and huff. But in international politics, he is an amateur. I want to see if Americans will be fooled by his beautiful slogans again in 2020 re-election. Now he has his own past records to speak off.
11
"Double Irish" and " Dutch sandwich " tricks.
Google repatriated 20 billion dollars from its business in Europe in 2019 without paying 1 $ tax !
https://www.investopedia.com/terms/d/double-irish-with-a-dutch-sandwich.asp
7
'Revenue grab'?
No, NYT. This is a reductionist, hyper-capitalist view of tax.
Tax is the cost to be part of, contribute to, and benefit from the upkeep of the lush garden of modern society.
Tech giants are externalising — let's be frank; immorally avoiding — large and important costs in a way we've never seen before. This needs to end for the good of US, European and worldwide societies.
28
@Jens Jensen Agree. Yesterday the NYT advocated a rate cut. What’s going on?
Tech companies employ very few people compared to their enormous revenue and they avoid taxation. Taking into account they put companies out of business which contributed more I. That respect, from a society point of view, many of the tech companies are currently counterproductive.
This needs to change.
2
@Jens Jensen I couldn't agree more. But, for decades the mantra has not been about what's for "the good of US, European and worldwide societies." but about what's good for individuals. A few individuals at that. It's that mantra that must change.
Tax exemptions for these internet-based companies is ludicrous and unfairly shifts the burden of maintaining society onto others.
Taxing these companies makes sense from both fairness as well as tax policy - our internet usage is now inelastic and the most basic of tax policy classes will show how taxing inelastic products and services causes the least market distortion.
12
We need to revamp our tax system. The fact that so many huge businesses, Amazon for example, pay no taxes is egregious
11
The tech companies provide free service - Gmail, Google news, free music, photos etc. They make money by advertising. They should be taxed on that revenue. A better way would be treat these services as imports, no different from the US importing French wines, Perfumes, Cheese etc. This would provide a consistent tax rate throughout the Euro zone. Each country taxing differently within the Euro zone will lead to chaos, and retaliation by countries whose companies are targeted in such a way. This is a EU matter and they need to settle it internally.
4
@Ben Scale is needed to avoid a race to the bottom. The E.U. should harmonize their corporate tax rates and ways.
1
This is reminiscent of the struggle over how to tax the railroads in 19th century America. Multijurisdictional entities with their operations and profit sources spread over multiple jurisdictions, and able to employ the best of bent accountants to prepare their returns.
The cure is a fair international treaty, and you can bet your bottom dollar that one is not coming out of either Trump's advisors or Mitch McConnell. The price of globalization is honest multi-lateralism. Even getting the Congress to go that far is a major step beyond American ingenuity.
Hegemones fall from greed. The exploited people get tired of the rip-off; the pretorian guards see their own interest can be taken care of without a corrupt Senate; and, lo and behold, the barbarians are at the gates.
Watching the decline of the American Empire is not pretty.
8
Imposing a 3% tax on internet corporate giants, an unfair business practice? You must be joking. These companies are trading and earning revenue in France, competing with companies in France who pay their share of taxes, yet they pay mostly zero taxes in France, by e.g. cutting deals with Ireland so egregious they were ruled illegal by the EU. They are driving French companies out of business and are a threat to the whole EU economy through unfair competition and monopolistic practices, NOT the other way around. Meanwhile, their trade is made possible by using the French internet infrastructure, which is paid by the French either through their personal and business taxes or private plans. Many people living in France, including myself, are taxed at a rate severalfold higher than 3%, yet we should all accept to pay for infrastructure these giants use for free, for the privilege of them jeopardizing our jobs?
All I just wrote is also true of their practices in the US by the way: there is a reason why these companies are registered in Delaware, and why Sears went down. While we speak, they are accumulating gross amounts of cash of the magnitude of several countries' GDPs. If you top it off with the recurring disregard of privacy laws, and some of them playing shady roles in the EU and US democratic process, from no angle can you justify the status quo. This looting MUST stop now, and you best believe the vast majority of French people support this tax, for a good reason.
32
This sounds similar to the issue many US States had with Amazon's on-line sales. States generated revenue from sales taxes. Amazon was exempt from collecting sales taxes in states where they had no physical presence. Laws were passed to fix this.
International tax laws need to be updated to keep pace with modern technology and its impact on international commerce. Tax laws based on physical asset location seem medieval in today's world.
11
Are all business plans that fragile that companies have to have super cheap money (look at interest rates in the United States for the last decade), cheap labor (the minimum wage in the U.S. has not been raised in 10 years) and pay no taxes in order to continue?
9
@Arie Denbreeijen Not exactly. The problem is that there is too much money looking for too little opportunities for return on investment with far too little appetite for risk.
It's the same reason you see mostly remakes and superhero movies in the theatres.
Companies have to cut corners in order and only bet on sure things to generate the massive and consistent profits that keep investors happy.
3
French elections are not awash in a swamp of unlimited political donations, dark money, and super PACS. Corporations are corporations, and people are people.
The French legislatures passed the 3% tax. The US legislatures passed tax breaks.
Coincidence? I think not.
16
@Lawrence. Excepts the yellow vests are still protesting.
1
Yellow Vests are French Trumpers. They want all the benefits from their nanny state but none of the costs.
Vive La Meme Chose
Important that corporate tech leaders and moneymen keep all their profits to pay for their mansions, yachts, private islands, and 14 year old 'staff'. And Lawyers. Above all lawyers...
Who says trickle-down economics doesn't work?
6
Our whole tax system should be changed. Amazon has hardly paid any taxes just like many other US corporations like GE and countless others. The tax system should be changed in the following manner. Change the tax on net income to a 5% tax on Griss Revenue. So if a company has revenue of $300 billion they pay $15 billion. A pizza retail store with one million in revenue would pay $50,000. No deductions . GE over last ten years had about $2 trillion in Gross revenue paid hardly any taxes due to its numerous losses . Under my method they would of paid$100 billion. The government would have a huge surplus. No deductions allowed.
8
@Ralph Petrillo
Cant say I've researched enough to put a percentage to it, but I agree 100%.
Taxing revenue in the way to go. Much harder to hide unlike net profit which can be so massaged as to be pointless tax metric.
1
@hugh
Exactly , what Amazon does is to constantly expand without regard for net income for it lowers their taxes dramatically and forceds out the competition.
These companies aren't providing a service to French customers, they are monetizing their data.
4
@HL
Exactly they should make the tax 15%z
The US should be taxing those huge tech companies just as much.
13
If these companies are making more than $825MM in revenue from doing business in France, then they should be compelled to put some of that money back into the French economy. They can't just siphon off revenue without participating in the welfare of its host countries.
And for the record, these companies should pay higher corporate taxes in the US, too. Their outsized profits only widen the income gap.
16
There are different ways by which US corporations cheat in Europe to pay no taxes.
It is a long time that the debate is in the European press. The US press has not informed Americans about it.
The US corporations are not fiscally registered in the USA. They hide under fake fiduciaries in Ireland and in Holland or Luxemburg to benefit from tricks like the "Double Irish " or the " Dutch Sandwich " in which they benefit from European laws meant to sustain small innovative businesses who can exchange their taxes and nullify them .
Google "double Irish " or " dutch sandwich " you will understand the tricks.
It is not only the tech companies that use these tricks in Europe it is all the big US corporations : GM, GE, etc..
That is why France has decided to tax the corporation that are worth more than 250 million dollars or at least 25 million dollars in France .
10
There will be no negotiation. If American corporations don't like our laws they are always welcome to leave.
12
@mons That is the intent of French. Likewise US should impose flat 5% tax on French perfumes and wines. If the French corporations do not like it they can leave. An eye for and eye and we can all enjoy not being able to see.
1
@Ben
Theses are not American corporations. Like the poster above wrote...they are based in Ireland, Luxembourg and other places where they have been given sweet low or no-tax deals.
4
@Ben. That has been Mr. Trump's trade policy from the beginning, I'm sure the Chinese are salivating at the chance to increase their business in Europe, at America's expense.
1
Decades ago, Southern states poached jobs and factories from the North with promises of low taxes and low labor costs. The problem when you compete on cost in a race to the bottom for workers is that someone or somewhere else can always go lower. This is the defining mark of late stage, shareholder capitalism.
8
Capitalism: The unsustainable exploitation of everything and everyone.
It is high time for these tax scofflaws to pay their taxes! The US should have done this long, long ago, but these companies have had the goverment of the US to pat their behind by giving almost complete immunity from taxation, causing immense deficits in our national revenues. Also, those companies arrogantly start limiting, ruling and judging speech online, usually with a huge slant to the left.
There is also an argument that these are NOT American companies at all, but international bandits roaming the earth in search of profits.
Tax them, France, and all the other nations of Europe and Asia where they dominate communication. Tax them, US, tax them. Make it painful for the trillions they have failed to pay.
8
On Lord what now, make all the gig companies workers employees instead of contractors and actually pay them benefits and overtime.
What will the world come to next?
13
The guiding light in these negotiations should be full transparency. The "consumer" should always have the choice, not the social network. Posting logarithms should be based on time submitted. Banning rules should be clearly delineated and contained in the obligatory "banning notice" sent to the poster. And, oh, yes; no more exemption (Section 230 immunity) from traditional publisher liability in exchange for providing a forum free of political censorship.
2
Bravo to the E.U. for giving the U.S. a taste of its own medicine. If the U.S. employs protectionist tariffs to reduce trade balances, then why shouldn't other nations tax the international earnings of U.S. companies? I realise the two subjects are not directly related, but both have one common element: Each penalty is perceived by the victim to be unfair.
Moreover, the U.S. service industry has been getting away for murder for far too long: I see absolutely no difference between a value added tax on U.S. widgets sold in France and the services of a U.S. internet provider in France. Both are selling a product in France and earning money in France, so that is where they should be taxed, and not in the Cayman Islands (Sorry, tongue-in-cheek).
15
@Hamid Varzi: Trump never learned that what is sauce for geese is also sauce for ganders. Monkey see, monkey do. Trump heap big role model.
2
Frankly I don’t see the problem. All this uproar just because corporations with huge profits have to pay their taxes, the same way you and I do every single time?
The fact that they are taxed in another country and not here is a question of political choice. Trump has allowed giants like Amazon to pay ZERO taxes.
You spoil the baby in your house than you complain if he is treated in the way it should be when at your neighbor ‘s home?
14
@ArmandoI I thought Trump was against Bezos and WaPo.
1
@Ben
The majority is against Bezos and other similar cases, but eventually Trump has the power take some action.
To be just "against" it doesn't help.
Not only the big US Tech corporations cheat to pay no taxes in Europe.
Mc Donalds, whose second clientele after the US is France, pays zero taxes in France. They declare all their restaurants in France as Franchises ( in France ) who pay a huge participation to Mc Donalds headquarters for Europe who sits in Luxembourg to benefit from tax loopholes and pay very little tax there . Then the French Mc Donalds restaurant declare to the French fisc admonistration that, after they have their participation to the HQ in Luxemburg, they make no profit, therefore don't pay any taxes in France.
Mc Donalds has a huge business in France and pays zero tax .
11
The wealthy aren’t interested in rules that will make the wealthy pay more tax
18
@Johnny Correct. You get the governments your pay for.
1
So, only Trump can impose unilateral sanctions to benefit the national well being. If France or England do the same thing, it's unfair. Here's hoping the EU imposes a carbon tax on every good and service coming from the United States until we rejoin the Paris Climate accords. As for Google, Facebook, et al, they have been protected from taxation long enough. It's time to make them pay their fair share as they work to destroy the nations social fabric.
13
Don't broker anything - let these companies fight for themselves. They are receiving more than enough tax breaks from the US. When it suits them, suddenly they are US Companies, when it doesn't, then they are world companies and not just the US, if at all.
13
Give us some alternatives to Google, Facebook, and Amazon.
6
Guess who started all of this?!!!!!
Support of NATO is not out of the goodness of our government's heart. The organization is not just for Europe's protection but as a shield for us, customers for military hardware as well as political influence.
Let's not be hypocrites about the arrangement! It's the price of being a world power.
3
"promote fair and efficient taxation". Too bad Mnuchin, Trump and Mitchell wouldn't promote a fair and efficient taxation program for the American people.
It sounds as if France and Britain have finally decided to fight fire with fire a la Trump. Good for them. It is about time this Administration be aware that their actions towards our Allies will have serious consequences for our Country.
What this Trump Administration has wrought by not living up to Treaties, from withdrawing from Treaties, is coming back to bite them.
12
The American income tax code provides deductions, credits, subsidies and lower tax rates.
But only for certain industries, individuals,transactions, sources of income, business entity structures, contracts and securities favored by lobbyists buying special interest government complicity.
A sage once noted that you are either a diner or you are on the menu when it comes to income taxes. Most of us are on the menu.
One corrupt trick employed by American corporations is generating and parking their income in foreign shells in Bernuda, Ireland and Switzerland.
The social media and internet companies are the new gilded age robber baron malefactors of great wealth. Technology has advanced ahead of our legal and socioeconomic ability to fairly identify and control their costs and benefits to individuals and society.
Donald Trump's ' America First' MAGA strategy treats traditional American allies as competitors. While American enemies become new business opportunities. This has invoked the latent ethnic sectarian nationalism that is essence of our African ape nature.
Steve Mnuchin is an ugly exemplar of Trump's favoring 'men wearing yarmulkes watching his money'. While Mitch McConnell and Rand Paul are trying to restore the Confederacy.
More importantly by failing to declare and divest his personal assets into a blind trust you can't tell where Trump Mar-a-Lago ends and Trump White House begins. Why is Trump hiding his income tax returns from the American people?
8
@Blackmamba: Rational targeted taxation makes sure that the cost to the end user of products fully reflects their costs of manufacture, distribution, and disposal, as required by the "efficient market theory" of resource allocation. Exemptions from this are probably subsidies bought by bribing politicians who couldn't care less what their constituents think about it.
The digital revenue grab? Rather twisted language. This revenue was generated in Europe and that‘s also where it should be taxed.
15
It is not only Google and Facebook, it is ALL the big US Tech corporations that are deliberately fiscally registered in Europe and not in the USA .
It is Apple, Amazon, Facebook, Google, Yahoo, Starbucks, Netflix, and others,...They are all divided in fake fiduciaries in Ireland in order to cheat and pay zero taxes in Europe while invading the markets, destroying the European economies, stealing jobs .
The cash money is repatriated to the US via the London exchange to the secretive US offshore banks in the Caribbean .
The fiscal fraud on the EU budget is gigantic. It amonts to 20 % or the equivalent of the EU budget deficit annually. If American corporations were conducting honest business in Europe, the EU budget would be balanced .
It is outrageous that the Trump administration is trying to make Americans (who are not informed ) believe that France is dishonest in trying to tax those corporations 3% .The European economy is based on participation because we have free education and free health care for all . If the US big tech corporations invade the EU markets by using the European infrastructures , they are basically stealing from European workers who have to pay for the health insurance of the workers of these huge companies in Europe, the education of their children, etc..
Americans don't have a clear understanding of that. They just think it is business.
19
@JPHAmerican companies are making out like thieves in Europe.
@heinrichz Exactly. And the way the cash money is redirected to the US banks just shows that also. They use secret banking paths via the London exchange who takes a chunk at its passage back to opaque US banks.
If Brexit happens, it is possible that the trick through London will be more difficult to pull because the British banks will need special authorizations from the EU central bank to transfer funds and if these transfers are dubious the EU won't give them the right to do it.
1
It's not a "revenue grab". It's a sovereign nation setting tax rates as per its mandate.
14
Noting that "countries have competed to reduce corporate tax rates, and attract business activity both physically and on paper, for two decades," the article fails to point out what's fundamentally different about the business models of online tech giants such as Google, Facebook and Amazon. They can't flee taxes. For Google and Facebook, their "crop" is us. And Amazon is (largely) a retailer. They can move offices and warehouses, but they can't take production to another country. They are sitting ducks, raking in astronomical revenues off populations that do not move. The British and the French have the right idea. Don't fight them; join them. Better yet, one up them: 4%.
9
These tech companies pay almost no taxes but are Worth hunfreds of billions of dollars. Makes sense.
9
In an effort to protect and promote its home grown tech companies (if there any), France will impose a higher tax on foreign companies like Google and Facebook than on French tech companies. Where will the socialist nanny state stop if this new tax goes unchallenged? What will be taxed next? The unquenchable thirst for more and more tax money to fund socialist France and to provide all things to all people without any effort on their part will be the economic and social death of France.
2
@paul In socialist France the people working for Google, Facebook etc have the same social advantage as the socialist french workers. Google face book and all they have a free ride with people working for them and them not paying taxes to support the advantage. We are not dead yet our thirst for more tax money goes for an health care nearly free, , an education system nearly free even for google people and compagnie Sometimes is better when you are poor to live in a socialist france
2
The U.S. for the past 5 year , on average, a $150 billion trade deficit with Europe, for a total of 3/4 of a trillion dollars. On top of that we pay, the U.S. pays $686 billion, or or 70% of NATO's budget to defend rich European countries. Only a handful paid the pledge of 2%:Estonia, Greece, Latvia, Lithuania, Poland, United Kingdom. Germany, France Italy, Spain, and even Canada spends on average a little over 1% for 2018. It's time we stopped countries from emptying our pockets.
4
The EU expanded into former Warsaw Pact countries under Putin’s watch. Why? Because without the EU buying Russia’s gas and oil, their economy would plummet.
Forward deployment is beneficial to the US, by the way. And US bases in Germany are used for nearly all Middle East ops. Where would you rather park those billions worth of fighter jets? Turkey?
1
@John The trade deficit to Europe has nothing to do with the US corporations conducting dishonest business in Europe and cheating to pay zero taxes .
It is not because you have a trade deficit that you have the right to be dishonest .
1
If corporations are people how come they aren't taxed like people?
Wonder what Mr Romney has to say about that.
14
Tech makes it's profits in free societies and should pay their share in maintaining them, rather than repatriating them to tax havens thru clever accounting.
12
I support the French on this: And 3% is ridiculously low; French citizens pay an ATV of 20%.
These corporations are swimming in money and operate almost tax free thanks to the largess of both Republicans and Democrats here and the REM in France whereas ordinary citizens have their backs bent by the weight of taxes of all kinds.
38
Go for it, Europe!
If only we had an enlightened president and administration that would levy US taxon them as well.
18
The Wasatch Mountains pay heed to me.
And the pink clouds of sunrise are at my
beck and call.
Afternoon simooms tiptoe around my patio.
I'm in charge, see?
I ask the rocks for sweat.
The pigeons for song.
The sidewalk for ice cream.
Asphalt gets out of my way.
There's nothing can stick to me.
See?
Light bends around my wisdom.
Darkness dare not lap my feet.
I'm a Marvel comic book waiting
to be opened.
Got it?
OMG, the administration that started this global trade war is trying to avoid being in a trade war.
13
Trade and Tax wars!
You have to be careful what you wish for, you may get it.
10
@Brian Barrett
This is not about a tax war with the US, although Trump's trade policies do not inspire restraint.
There are infrastructure, administrations and public services in Europe that US tech companies need and use to make their profits.
Without those, Google execs would be robbed and clubbed to death by Neanderthals as soon as their corporate jet landed.
At the moment they are not paying anything, not in corporate tax, barely in employment. This is not normal.
Revenue taxation is in principle a bad way, but with locally reported profits being meaningless today perhaps the way forward.
1
But I thought "trade wars are good and easy to win," at least in the fevered imagination of our fearless leader. Is he now whining about getting a taste of his own medicine? My heart pumps custard for the poor soul. Nor do I feel sorry for those poor tech monoliths who've avoided American taxes so long only to face some European taxation.
26
@Christy "I like tariffs!"
4
So a Kentucky company is going to get a break on a 10 percent tax on its dividends, thanks to Senator McConnell. Evidently, getting 90 percent of dividends tax-free is just not enough for these freeloading millionaires.
There should be a joint tax policy; but I get the sense that our country's leaders are not so much working on getting software companies to pay taxes as they are trying to protect these software companies from paying any taxes at all. After all, Republicans took their anti-tax pledge and they're sticking to it.
Meanwhile the US budget deficit widens to $747 billion to pay for their tax cuts and guess who Republicans will demand to pay for them.
15
I have not seen any explanation why the tech companies are exempt from taxes. This probably goes to the early days of the tech jump to "give these companies a little break" to catch up with the others. The other reason may be the incentives given these companies to move their operations to low tax countries which is now coming back to bite them. If they earn income, in any country they should pay their local taxes.
Ironically, this kind of tax evasion moves that move the American companies to elsewhere hurt the American economy as well. All the countries should tax the income generated by these companies. There is no reason whatsoever for them not to pay taxes.
39
@Cemal Ekin
The French tax, as proposed would be on sales, not on profits--a significant difference.
@Heckler, any reason for the big tech should be exempt from sales tax? That is the reason I used "... exempt from taxes" rather than income tax only.
It is with amazing speed that the US races into this fight to retain dollars here rather than have them go abroad.
Our present tax laws, designed primarily to shield wealthy shareholders while increasing the tax burden on regular taxpayers, has raised corporate valuations inordinately and simultaneously starved the government of needed revenue.
The wealth disparity that exists in the US is due in great measure to this tax code which is both inequitable and unsustainable. Modified over decades to advantage the very wealthy by using spurious reasoning, it has served to fund politicians needs to the detriment of their constituents.
Thank you Europe for putting the spotlight on this issue. Now if only politicians could speedily fix what they have broken, clean up their mess, and bring equity to the tax code.
We need fewer loopholes, less need for accountants and tax lawyers, and public financing of elections.
44
"...specific industries should not be singled out with a different standard." Really? When for years online companies were given advantages that are still doing much to destroy retail? (Retail: where so many people in anyone's community may find a job.) Big companies and their servants in Congress howled about high tax rates for years, but no company actually paid those rates. Money is the only thing humans ever invented that's every bit as powerful as the hunger and sex drives wired into us by nature. We've been assured that corporations are people. OK. When people can't control primal drives, they may end up in treatment or in jail. The big companies are addicted to money -- they can't get enough. They need treatment to help control their wild appetites. Reasonable taxes must be part of that treatment, for their own good and for the good of society. To all the people now being manipulated by the hysterical warnings about socialism: please recognize the sick genius of the 1% in successfully transferring, over the last 40+ years, massive amounts of wealth to elites. Really, it's a cry for help, but it's not that hard to balance free enterprise and social obligations. And yes, I recognize that the far left sky-pie-promisers also need help managing appetites.
22
Please explain how an American company can manufacture everything it sells outside of the USA and remain an American company. I know it's legal... but..
And what in the world is the "risk of double taxation?"
BTW why are foreign owned companies allowed to exploit the American labor force (non-unionized workers and basically laws against unionization.
So many questions. PS I think tariffs are interesting -- esp. on so called American goods (by Apple, e.g.) made in China.
#Why goods used by Americans probably should be made in America... (providing jobs for the immigrants who want to come here.... or move the factories to Central America? endless possibilities.)
6
@Auntie Mame I have long thought that the U.S. should apply a hefty tariff on goods made by corporations that are based in the U.S. and have sent manufacturing jobs abroad. The tariff could be scaled back if a U.S. corporation brings those jobs back to the U.S. The corporation would need to meet certain wage standards and would need to maintain those jobs for a specified number of years. I would also like to see an end to subsidies for corporations. Koch Industries, for example, received $507,091,478 in state, local and federal subsidies. (Source: Goodjobsfirst/subsidy tracker).
1
So Europe's giving you a taste of your own medicine?
Oh, my bleeding heart.
29
Listening to the well-spoken French representative explaining the tax on NPR last night, he pointed out that the tax is “only” 3 percent, while ordinary taxes in the European community countries where the monolithic digital companies prefer to do their business - and take over smaller enterprises- run between 20 and 30 percent. While he estimates this small tax will generate hundreds of millions for France’s real needs, it will hardly cause a headache to these monoliths- and will in some way benefit real human beings. He also noted that a just distribution of wealth generated by digital economic activity should be addressed by the G7 meetings and the EU. Makes sense. Vive la France- vive la republique!
37
Interesting how in the US, the government jumps in very quickly to make sure giant US monopolies and executive bonuses are aggressively protected and preserved! (Google, Facebook, Apple, Microsoft.....or Exxon-Mobil, Halliburton, Ford, GM, Boeing, Bechtel, etc)
But when it comes to workers and the middle class, Trump and Republicans and establishment Democrats have done ZERO defending our nation Vs the global labor arbitrage of the last 30 years.
When will the American people get our government back from Corporate and Oligarchy rulers? When will corporations be allowed to die.....after many years of allowing workers to lose healthcare and die!
22
Gee......and the next thing you know these "socialistic" nations might use some of this revenue to fund additional healthcare and roads for its citizens. Sort of like when the US minister of Health recently accused these "socialist" (his words) nations of unfairly negotiating lower drug prices at the expense of American pharma companies.
18
The current conflict between the state and big technology is only confined to revenue sharing and occasional reminders of individual privacy rights. Beyond that both thrive on the public plunder trough tax and ad money while making a common cause when it comes to the surveillance of people and controlling their lives.
5
Okay, two things. If a company does not wish to pay taxes to a foreign country in which they do business, that company can cease to do business in that country. Second, the US should impose equivalent taxes on foreign companies doing business in the US if it doesn't already.
9
@Mike
We should first impose taxes on our companies and do away with their business loop holes.
1
While the Trump tax cut brought the corporate tax rate down to 21%, which is the average of developed countries, there can often be a large difference between statutory and effective tax rates. This is particularly true in the US with its convoluted tax code with so many loopholes and exceptions. Before the Trump tax cut, the effective corporate tax rate in the US was similar to that in the rest of the developed world. I can only assume that the Trump tax cut dropped the effective US corporate tax rate well below that of the international average. I have no problem with a digital tax. Surely the US needs more revenue streams after the Trump tax cut. Let's have a financial transaction tax, too. That one is long overdue. Of course the US now has a much larger national sales tax in the disguise of the Trump tariffs.
10
Of course the European car tax will be thrown out there as threat of retaliation rather than to look at the problem honestly and recognize tech companies have not been paying their fair share anywhere.
The EU is the last bastion of sanity and prosperity for citizens. Countries like Germany, Netherlands, or any of the Nordics prove that full employment, growth and happy citizens with great infrastructure and public services are not a trade off.
Republicans can’t process that.
24
Since taxes on businesses are inevitably just passed through to their customers, France and the UK should drop the pretense of 'making American tech giants pay their fair share' and just apply the tax directly to UK and French residents based on their usage of FB, Google, Amazon etc. The politicians don't want to do that, though, as that just demonstrates that all they care about, is shaking individual taxpayers down to pay more, in countries that already have some of the highest marginal income tax rates in the world.
5
Of course protectionism must be robust for the biggest corporations, tech or otherwise! They should pay no taxes (like Exxon and Amazon and the rest of them here). That's what the little guys, you and me, are for . . . we're here to foot the bill. This is just another example of corporatism masquerading as democracy.
23
@Mike7
Yes, the locus of power is through Corporate America.
We should think of ourselves as farm animals
1
It makes sense to tax a company where it generates revenue, not where value is created. Value is nothing unless you can use it to generate revenue. A tax on revenue is used by the City of New York to tax utilities, it"s 2.35% of revenue. It works fine and is a steady source of revenue. If you want to tax based on profit, you can compute the tax based on world wide income apportioned to each country based on sales revenue in that country. No more hiding profits in tax havens.
8
An additional important point here is that at least some of the companies (e.g. Uber, Amazon) use infrastructure (road etc) paid for by French taxpayers. Therefore it is entirely unreasonable for Uber / Amazon etc to avoid paying taxes to contribute to the infrastructure that they knowingly use.
13
America redesigned its corporate tax system to favour American companies. It now regularly uses tariffs for purposes that have little to do with fair trade. Not surprisingly, when the rest of the world deals with the USA, it will do so with less interest in such quaint concepts as fairness and norms. This will no doubt be among the first of many instances when America's - ahem - allies take steps to redesign their tax system without regard to whether it is fair to America.
263
@Richard
As if fairness to America has been a high priority for countries when they design their tax systems in the past. Absurd.
"Fair trade" does not currently exist, which is why the West is imploding.
Perhaps Europe can use the revenue from the taxes on American companies to fund its own defense, instead of having American taxpayers do it for them, as they have for the past 75 years. It will soon find that militaries are rather expensive, so the much-envied social safety net is going to be a major target for revenue generation.
Also, it would appear that places like Ireland, which is a member of the EU and an American - ahem- ally, structured its tax policy to favor Ireland at the expense of the rest of the EU, not to mention American workers whose jobs were offshored as a result. It was a rather egregious violation of "fairness and norms" and not exactly "fair" trade.
And any government that doesn't structure its corporate tax policy to favor its companies is irresponsible, corrupt, or just stupid enough to listen to economists, which we have been doing in America, which is why we are now in the early stages of social upheaval.
2
@TB social upheaval is occurring because the wealth disparities under deregulated capitalism have reached a breaking point. Some people choose to blame immigrants for this, others choose to focus on America spending a minute percentage of its GDP on leading an allied defense - which in any case works to its financial interests. Indeed America can try to bully its way through other countries in favor of its vaunted multinational corporations - still doesn't address the wolf at the door.
9
@TB The EU will face a race to the bottom in corporate taxes and rogue players (Ireland, Lux, Netherlands, ...) until it harmonizes its fiscal corporate rates and methodology.
1
Maybe I'm missing something but I was under the impression that a country can set their own taxes on whomever or whatever they want. Why is it any of the U.S. government's business what another country wants to tax a corporation doing business in their country? Think of the flip side and an equally bizarre headline "Foreign Country Want the U.S. to Raise Taxes on Corporations."
319
Totally agree. What’s concerning, however, is this part of the article:
“The French tax, which would exact a bigger toll on foreign companies than French ones...”
If I’m reading/understanding that correctly, it seems completely unfair and designed to punish foreign companies. Nationality shouldn’t factor into the calculation.
3
@Dash
That is due to the fact that American companies dominate the digital world. The tax will apply to all digital companies and their revenues, the majority of which are american
24
@Dash
The proposed law does not discriminate any nationality, it discriminates the size of the company. If any French company becomes big enough one day, it will be subject to this tax.
42
I am waiting for the mainstream narrative that will soon claim that the US is the bad guy here, and within a month or two, for it to blame the US for starting a trade war with the EU.
Basically, the EU has exactly zero to offer the world on tech at this point, and the only way that they can get back at successful US firms — who have played by the book on messy and crazy EU’s tax laws, for which they’re not responsible — is to tax them or bully them into antitrust submission because some competitors (not consumers) are caterwauling.
I hope the US hits back relentlessly, and hard.
3
The E.U. commission just doesn’t allow market domination of that size. Recently they blocked a merger between Siemens and Alstom that would have created a world rail giant. The US, which doesn’t believe in antitrust anymore, would have let it go through.
I thought we moved past limitless admiration of the tech giants and started seeing all the problems their outsize power is causing.
10
@Whatever
The US is behind 5G technology. European countries are adopting it from China. Monopolies tend to retard technological development. The 1998 deregulation of telecom companies facilitated this development somewhere else. Geographical limits only act temporarily in terms of capital expansion. It will show somewhere else if we squash it here
2
@Liz leaving aside the fact that the EU is chock full of market-dominant firms (e.g., Airbus, state-owned oil companies), and the fact that the outsize power these firms hold is a direct result of how consumers globally love their products and services, putting a revenue tax will do exactly zero, zilch, zip to address any of the ‘problems’ you bring up.
Unless you can tell us how.
1
So let’s just tax them back. I don’t understand why any American would support France taking dollars from Americans. This is France taking from you to feed their welfare state.
I really question the sense of any American who supports this.
2
France is taxing - at a very small percent - the profits companies make WITHIN France. Nobody is taking anything from Americans.
18
I think you’re confused—they’d be racing income made in their country. Not US dollars, not Americans. Money made on their citizens in their country. It’s quite fair.
10
Gracious! Other countries now want our “ robber baron” tech. companies to pay them a fair share of taxes? What is the world coming to? Maybe one day, these same U.S. companies will pay their fair share of taxes here as well.
448
@Ellen
Other countries are already taxing US private citizens who live there. AND the US taxes them as well. Now that the US is squawking about Google getting taxed abroad. Isn't it unethical that the US is the only country to double-tax its citizens abroad?
(Some of the double taxation is corrected if a tax treaty exists between the two countries).
5
Well, we're not taxing the big tech companies (we're talking about 'breaking them up', whatever that means), why shouldn't the citizenry of some other country with more sense benefit from the tax income?
4
Of course these big tech companies should pay taxes in the countries where their services are used and they make their profits. But I am writing this posting from a country, Netherlands, which is tax avoidance paradise for those big tech giants. We do everything for money.
7
Having the tech giants pay their fair share is a great goal.
Setting exemptions for local companies and setting cutoffs to ensure that only US companies have to pay - sounds like a declaration of trade war on the US.
Tax all internet companies - equally, fairly and transparently.
2
@Paul
Declaration of war no less? Maybe you should save that for Iran, one war at a time is enough to keep your defense industry happy.
It’s just a general law to tax large tech companies. No european company is exempt. It’s just that a lot of big tech companies are from the US. Some big tech companies from France will have to pay too.
4
The tech industry...they want to invade our privacy, sell our personal information, and not be taxed in countries where they are making tons of money. Google that and sign me up.
14
The US government needs to realize that this is part of Emmanuel Macron’s “Make France Great Again”campaign. He’s focussing on companies who have been bad, very bad. Very, very bad.
6
Not to worry. Trade wars are easy to win. I like winners.
3
President of France has taken a page from Donald Trump's playbook. You want someone's attention, put yourself out there.
As far the tax, who cares? I don't. We continuously read about the high value of these companies and their huge profits. Tax them!
11
Great to learn the Trump administration is finally "scrambling" - -the prospect that Google and Facebook might actually have to pay taxes abroad is evidently horrifying.
Who knew the U.S. government exists to save these companies money, and that's what we pay Steven Mnuchin for?
12
@jrd Yes, shocking that an Administration is actually standing up for US economic interests. Certainly that wasn't the case from, say, 2008 to 2016, when the main preoccupation of the government was choking the economy with taxes and regulations, and then wondering why the recovery from recession was the worst in three centuries.
@Achilles
Since when are Google and Facebook "U.S. economic interests"? Is government supposed to promote the private interests of shareholders of these companies?
What is this? Communism?
As for the failures of Obama -- it's true the stimulus was much too small, thanks to Republican opposition and right-wing Democrats, but you do know that there was more job creation under Obama than Trump? And that the promised investment boom from Trump tax cuts never happened?
7
@Achilles Nonsense. A large part of the Obama stimulus was a substantial tax cut: deficit financing to gin up demand, inasmuch as the Great Recession was nothing if not a problem of effective demand. As for the regulations, I seem to remember the financial industry's unchecked excesses in the way of credit default swaps and collateralized debt obligations.
2
These companies destroyed the Internet, turning it into a flea market of useless junk, making billions doing it, money they do not deserve.
Amazon, Google, Facebook, Twitter, Snap Chat, Instagram et al belong to the dust bin, plain and simple.
Give the 'net back to the people.
12
@waldo: The original internet conception was everyone could make their own website. I was a consultant at Time Warner Cable when it was developing the Full Service Network, where it expected to provide and control all content, so I got an early education in how much commercial resistance there would be to the "black pipe" concept of personal websites.
@Steve Bolger
And I was one of the first 500 signing up for a (dial-up) internet connection in Toronto. I used it to get facts and information, which I was able to find with ease, using one of many several search engines - pure joy.
Then Google came into being, followed by FB and the rest.
Why the government (or governments) let all this happen remains a mystery to me. In fact, I consider it a crime.
3
If Mitch McConnell suddenly becomes interested in “bipartisanship” you can bet that some big company will benefit in some way.
27
So the American government officially and now unashamedly speaks with the same voice as our glorious multinational corporations. Noted.
17
Our government’s hypocrisy knows no bounds. It takes in billions of dollars in fines from foreign companies through the Foreign Corrupt Practices Act and various sanctions (the vast majority of companies fined under these laws are not American and were fined based on conduct outside America), at one point fining France’s Alstom into financial distress so that it could be taken over by General Electric. If we have laws like that disproportionately target foreign companies, we have no basis to complain when foreign countries impose taxes that disproportionately impact American companies. The French must be rolling their eyes.
31
"Senator Mitch McConnell of Kentucky, the majority leader, moved on Thursday to set up a vote on the quartet of treaties next week, in what would be a bipartisan victory for multinational companies. The package is expected to succeed in garnering the support of two-thirds of senators voting on the issue."
Monarch McConnell immediately springs into action when corporate and rich shareholders profits are at risk, but he refuses to take up a House bill expand voting rights, limit partisan gerrymandering, strengthen ethics rules, and limit the influence of private donor money in politics.(i.e. HR1).
Greed Over People 2019
Republicans have utter contempt for Americans.
153
Taxing revenues instead of profits is horrendous, and part of the general antipathy to growth in Europe. It is a measure of European delusion that the tax code, environmental policies and industrial policies all discourage growth and innovation, but leave European voters and governments wondering why there is no growth or innovation. The Times won't admit this in an otherwise useful article, but the underlying resentment and anti-Americanism of these taxes is obvious. France especially should spend more time wondering why its cab drivers burn Uber vehicles and less time trying to extort money from Google and Amazon.
1
You are mistaken. The new taxes in France, hopefully soon to be replicated in the UK and elsewhere, are a reaction to systemic tax avoidance over many years by the tech companies. This is not anti growth, it’s a straight forward measure to curtail tax avoidance, something that Donald Trump obviously wouldn’t understand given his own tax avoidance behaviours.
France is to be applauded, the villains here are the tax dodging tech companies.
16
@Andrew So, you think taxing revenues....not profits....is pro-growth? Interesting. I suppose you think wealth taxes and a 70% marginal rate is a good idea too. The reality is this is a tax grab from nation states who have anti-growth strategies and now resent the fact that the US has created companies and growth they never will. And your analysis leaves out that these companies have paid taxes in the EU country of Ireland, which has lower taxes than France, the UK and the US. Corporate management is not "greedy" when it uses lower tax nations as bases of operations: it is acting in the fiduciary interest of shareholders. The "villains" here, to use your parlance, are the socialistic anti-growth governments of Europe, not US corporations.
Tech companies have very limited variable costs. Marginally taxing revenue is not a bad idea when they can easily hide their profits from conventional taxation.
1
Bureaucratese for doing nothing:
“join with us in an intensive effort to reach a comprehensive, multilateral solution,”
4
Time has shown you “push” these global brand “huge” companies too far for more money and they fight back by removing their services, laying off employees, and moving corporate offices. Better think this one out before impulsive action.
3
US tech companies have engaged in systematic tax avoidance over many years, see this as legitimate business practice. It’s not surprising that other governments have tired of this and are planning to change their policies to capture the missing taxes. The only real surprise here is that they’ve taken so long to react.
If Trump, a serial tax avoider himself (some would say tax evader), wants to avoid this being repeated in other countries then action needs to happen at the OECD very quickly. If he tries to deter such measures without progress at the OECD then I suspect he’ll be disappointed.
8
“They would allow companies with operations in those countries to avoid some previous tax penalties for transferring money to their operations abroad,” “tax penalties”? Are taxes failures to pay sufficient bribes, “lobbying”? Perhaps a slip of the tongue? Do Americans believe that taxes on corporate profits are penalties? Aren’t corporations “legal persons”. Shouldn’t all “persons” pay their fair share?
Trump doesn’t want France to impose unilateral taxes on American companies but Trump targets specific companies to set tariffs on foreign corporations...unilaterally? Why? Because Trump is the Emperor of the world. Ask Putin.
11
Strange how Trump's tariffs, tax *cuts* and now tax retailation threats all seem to circle back to hurt middle-class Americans the most. It's almost as if he really doesn't like us ...
10
I think this is an encouraging development. France, Great Britain, go for it. Lead the way. Demonstrate yet again that huge corporations can pay some taxes without any significant effect on their businesses. Why does our government have any standing to complain about this? So-called American companies never let patriotism stand in the way of squeezing out the next buck.
23
So how will Europe react if Google and facebook start charging for the services which they now provide for free to cover the tax?
2
@MIKEinNYC Their services are not "free". They are collecting an enormous amount of data on its users and selling it for mega profits. They also collect money for advertising, etc. American corporations do nothing for "free".
8
@MIKEinNYC If their lobbying doesn’t work they’ll most likely pay the taxes.
2
@MIKEinNYC they already do charge for their services it’s just that you and I aren’t their customers, we’re the product they are selling in the form of the trove of personal data they collect on us.
12
Good. Why shouldn't tech pay taxes on their absurd wealth? A company provides a service, makes money and gets taxed on the income--that's kinda how commerce works. The hubris of tech and the US thinking this is unreasonable is proof of the need. Time for some forced humility.
And for those claiming that these companies will move elsewhere, that's not applicable here. The proposed taxes are on the income derived from servicing these countries' citizens, not on their physical presence. These tech companies are not going to stop providing service and making money off these countries. Nor will them "cooking the books" change it. It's based on income, not profit.
Finally "In its attempt to show international leadership..." Thanks for the morning laugh, Times. If there's anything we're absolutely certain of at this early Friday hour, it's that Trump has ZERO leadership skills and ZERO international respect. So, the horse it out of the barn with that one.
14
@Brooklyn Dog Geek
Actually COMPETITION is supposed to bring down prices. Whoops, I said a dirty word.
All that matters is.... maybe not even the Market -- maybe only the 1% -- and lawyers.
We know people don't matter nor the health of the planet.
1
Taxing income of these companies is hopeless. They can easily and legally cook the books to minimize income on paper or move it to low-tax jurisdictions, just as they do with profits. Taxing revenue, as France has done, is the only way it's going to work. Anything else is just for show. What's the big deal, anyway? It's French consumers who will ultimately pay the tax, and a 3% levy isn't going to make them suddenly abandon Google, Amazon, etc, and switch to untaxed small start-ups. It gives an extremely marginal advantage to small companies to challenge the giants and bring some competition to these markets, which wouldn't be a bad thing.
15
Why not tax tech? They have accumulated so much wealth, ordinary people are suffering. Since their business models include harvesting data from citizens, it appears the only way to get them to pay for the use of that data is to tax them, then regulate them, just like any other monopoly.
Makes perfect sense. The US should follow suit.
35
Good on France. It's about times these companies paid a fair share of their tax. Hey, if they don't like it, they can always choose not to do business in France.
16
A multinational agreement is the only way to fairly tax internet trade. Too bad we don't have a president that understands we live in a global economy. France and the UK are right, they should implement their tax and only remove it when the U.S. negotiates a multinational agreement in good faith. This administration has demonstrated over and over again that they are incapable of working with our international partners. This is what you get when you act like a bull in the china shop.
25
The US has dragged it's heels on a tech tax for years. Now the rest of the world has decided to stop waiting while US companies damage brick and mortar companies and pay next to nothing.
8
I hope Europe taxes the Big Tech companies right up the wazoo.
For far far too long, these companies have acted like they are above the laws of every country in the world.
They want Global Dominance, while being accountable to no one.
Just look at the arrogance and contempt Zuckerberg has for Congress after all FaceBook did, or looked the other way, as Russia used the FaceBook platform for propaganda, not only in the US, but around the world. Even fomenting racial hatred and genocide in the developing world.
No conscience, no accountability whatsoever.
Just look at Twitter, letting Trump blast out his mindless tweets like a megaphone Held up againstthe public’s ear, all for free, while the rest of us are voiceless, little ants.
And the others— Google, Amazon, Apple —tracking our every move, search, click, purchase or mere looking, even our speech, conversations, faces, friends and family.
They are building monstrosities with AI, not to “serve” us, but to control and extract trillions from our own personal value and worth — our inherent humanity — and not just “for sale” but stolen behind our backs.
To see the future: just walk along the streets of San Francisco — multi-millionaire techies gliding past in their Uber-limos, while homeless people live and die, literally, on the street. There is no caring.
Europe is wise and just to tax these monsters. Tax the heck out of them, and use the money to help the poor.
47
So this is the response to “America First”.
6
@EW
not really. The companies have been avoiding paying fair amount of tax in the host countries for many years before Trump.
3
Is Congress really so stupid as to ignore this opportunity to hold our surveillance capitalist would-be masters to account, at least a little? They have scheduled hearings about whether to impose Antitrust restrictions on them, why not consider this simpler approach to what could turn out to be a more symbiotic relationship?
Europe has the benefit of forethought with the GDPR, protecting its citizens against the control these companies have over their lives. So it's logical to tax them for the privilege of continuing to mine our data wakes (data waste to us, unless we use it to track ourselves) to use it to analyze, control, and profit from us.
In my opinion, they don't go far enough, and should tax bitcoin and its ilk for using so much compute power at cost to our environment, and the financial markets at a very small sub 1% rate for every financial transaction, so we can track them too!
With infrastructure challenges, expectations for our civilization and its future in peril and the present and coming ravages of global warming and environmental disaster awaiting us, it's about time governments stepped in and funded something responsive. (And at least in democracies, governments work for the people). They can't do it without taxes, and as Willie Sutton was quoted as saying about why he robbed banks, "Because that's where the money is."
12
Bravo France and England, get these companies to pay taxes and maybe it will catch on here in America.!
20
A "flurry" of lobbyists descend on Washington! Panic in the administration! An orange-faced occupant considers retaliation! Diplomatic channels opening between countries for immediate discussions! The Senate, and McConnell whipping into action and passing laws "Thursday" to work to avoid this catastrophy...
This must be about the Father and child found face down in a river, or about children held for months in cages, sleeping on cold floors without toothpaste at a tax payer cost of $750 per night per animal, I mean migrant, I mean human being. Or about our dying 2001 911 first responders unable to get health Care because these things take time. Or about .
Nope. It's a horrifying 3% tax proposed on a *fraction* of foreign sales, of the 0.1% Corporate Persons. Mr. Amazon, Mr. Google, Mr. Facebook, and Mr. Apple will not stand for it! A tax is bad! It transfers money *back* from the 0.1% to the public works of the 99.9%, from which it was efficiently extracted.
Don't tell me that corporate money hasn't completely corrupted our system of government. Occupy Wall Street, people!!
58
“The digital revenue grab is pitting traditional allies against one another”
Yeah, no. You appear remarkably unaware that what has pitted traditional allies against one another is your choice of president. The rest of us are just reacting to the consequences of that choice.
22
@Everyman We did choose poorly.
2
So when France wants to impose a 3% tax on the wealthiest companies in the world the NYT calls it revenue grab, so I guess the 15% tax cut given by the US is a revenue grab by these companies.
12
@Joe
This is a revenue grab, which is why Trump is absolutely right.
2
@AACNY A 3% tax on revenue is a "revenue grab?" Why should these very wealthy companies not pay their 'fair share?" Would not a higher figure, say 10 - 15%, a fairer number?
4
@AACNY
And why not grab that revenue? These are multi-billion dollar companies with millionaire and billionaire executives and stockholders. That’s way too much money for any one entity to possess without paying governments for the infrastructure and well-being of the societies from which the sector companies profit.
I am so over unconstrained capitalism. It’s a death cult that cares more about money than the general welfare of individual people, societies, and the planet.
8
On the homepage of the NYT, this taxation is referred to as a "revenue grab." To be clear, this is not a grab of any kind. This is absolutely fair and reasonable taxation set by a sovereign nation on immensely profitable companies, solely on the profits earned in said sovereign nation.
40
"light physical presences" may be but big big business . Taxes should be paid in the country where the business is done. The Irs goes all over the word to recover taxes , just fair to do the same Trump has a certain arrogance: the world should go according to his dictat.he should enjoy one day the table will turn
7
Vive la France … My heartfelt thoughts and prayers …
6
Maybe the French have learned some negotiating tricks from The Donald. No doubt The Donald will respond by threatening tariffs and sanctions.
My feeling is that France is a sovereign country and as such should be free to set up it's own tax structure. Maybe Macron decided to put France first. Make France Great Again. When do the other countries in Europe wake up.
As another commenter said below: "Tax the bejeezus out of Amazon, Google, etc. …. Viva la France."
11
No worries, legalized bribery will work its magic in the Senate and whatever the Tech companies want they will get. If it turns out Tech companies must pay higher taxes in other countries Trump, Mitch McConnell and the R-gang will lower their taxes in the US. And Chuck Schumer, Joe Manchin and the other faux, for the people democrats, will help out. After all, executives work very hard working the politicians and it would be unfair, even unAmerican to reduce their bonuses.
Such is life in our growing kleptocracy.
8
TAX them and TAX them Hard Europe.
I want to one day in a place where the books are read, healthcare is affordable and privacy is something that respected.
14
In a broader scheme , it is a fragment of Trump's intention to break up the EU, with his only ally Putin.
4
@Marco
That may be Trumps' intention but he knows so little about the EU, lacks any strategic intelligence, and has no allies.
I think we will live happily in the EU long after Trump is gone.
3
Trump is doing what a US president should do. Backing his country's companies abroad.
4
Amazing how effective and cooperative Congress can be when corporate profits are at stake! Who says Congress can't get things done?!
38
Fiscal, monetary and financial issues, programs and policies have to be considered interdependently, not only on the domestic but especially on the international level. In order to do this the proposal for a carbon-based international monetary system might be a pathway.
As presented in Verhagen 2012 "The Tierra Solution: Resolving the Climate Crisis through Monetary Transformation" the key for this transformative global governance proposal is its carbon monetary standard of a specific tonnage of CO2e per person with its balance of payments that covers both financial and ecological (climate) credits and debts.
Stated an outstanding economist and climate specialist about this transformative proposal for the 21st century: “The further into the global warming area we go, the more physics and politics narrows our possible paths of action. Here’s a very cogent and well-argued account of one of the remaining possibilities.” Bill McKibben, May 17, 2011
2
Why should the U.S. care how France taxes Google or Facebook?
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@Jake
For similar reasons as France would care about the US taxing imports from France.
Additionally, taxing Google and Facebook outside the US reduces their profits, which reduces the gains to their shareholders. The majority of these shareholder are based in the US. This reduces capital gains to those shareholders (and possibly dividends), which reduce the taxes collected by the US Govt.
4
@RB
And we should care about their shareholders? My life was just fine before these companies came along. I could totally live without them.
6
Maybe Trump can sue, or declare bankruptcy. His two favorite tools. Go for it Donald! And people, please stop protecting him. He knows what he's doing!
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“We have and will continue to urge France to forbear from such unilateral actions and join with us in an intensive effort to reach a comprehensive, multilateral solution,” wrote Kimberly J. Pinter, deputy assistant secretary in Treasury’s office of legislative affairs.
Why hasn't the U S Treasury Department urged Trump to do the same? Trump, the "World's Greatest Deal Maker" (in his own warped mind) has acted unilaterally on almost every issue he's been faced with. Up until now, other countries have been fearful of antagonizing Trump, concerned about how the Dotard might react. Now they're realizing he's not much more than an immature brat constantly, whining that he's not getting his way in all things. What's the best way to overcome his attention seeking stupidity? It appears that France is going to ignore his tantrums and let him cry himself to sleep.
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Why is the nation government of France being singled out for taxing companies that make money from people in the country of France?
I could see it causing concern if France wanted to implement a tax on Facebook and Google for their businesses in Chile. However, that's not the case.
Weird article, almost like a puff piece for the Treasury Department.
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@Tom
Because the tax is being targeted only at one industry, which is predominantly American. Besides, an EU tax structure already exists for these businesses, which is the reason they choose to set up EU HQ and operations in tax-favorable Ireland (and not, say, France) years ago.
1
Given Trump's abandonment of alliances and his America First mentality, he certainly can't complain about other countries playing the same game.
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The French and British are bringing an issue that has been around for years with little or no progress to a head. Basically it's about equitable corporate tax treatment. Why should small, medium sized and responsible large corporations be paying taxes in the low 20's in Britain or France while deep pocketed tech corporations can go shopping tax jurisdictions and be only paying single figures. This is the nub of the matter.
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Oh, great. Uncle Sam rolls up his sleeves to throw a few punches for Google. Now THAT is a tag team. Look out, Europe.
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Why should France or any other country work with the United States on any issue, at least until this administration is gone?
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Viva la France! Tax the bejeezus out of Amazon, Google, Facebook! Not only have they avoided paying their fair share while making billions, but they have been pursuing lines of technology to enslave the world. They have openly and repeatedly demonstrated that they can't be trusted to to protect individuals nor society.
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“The digital revenue grab is pitting traditional allies against one another, threatening to set off a cascade of tax increases and tariffs unless political and economic leaders work out a multinational agreement to avert them.”
Since when is taxation of revenue by a sovereign nation a “revenue grab?”
I thought I was about to read a news article but I guess this is an opinion piece.
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"a bipartisan victory for multinational companies"
Ah, so that means the rest of us lose.
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It's nice to hear Americans supporting this tech tax.
And we say it like it is a new tax when all companies should pay their share off tax and stop using loop holes to ultimately pay barely anything at all. It's a disgrace. Australia also needs to step up but the tech lobbyists have had such a firm grip we just postpone it for next year...
Good on France for stepping up! It seems people far and wide feel the same way about these tech companies.
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@Natalie Isaacs
They would support anything and anyone, including the Iranian mullahs and our nefarious CIA, at this point because they despise Trump. Rest assured, it has nothing to do with principal.
1
If a company makes money in a country whether the US, France, the UK, or others, it should pay taxes to those countries. It's only fair. But here the Tsar of Tarrifs says he is going to investigate whether this amounts to an unfair tarrifs bt France. His tarrifs are an unfair tax on US buyers purchases of tarrifed goods. France plans to return revenue to France to improve France for its citizens. Trump thinks only of helping the multimillionaires and billionaires. France actually thinks of its ordinary citizens. Who's cleaner in their goals? Trump should learn the words to "Oh, Despicable Me." He certainly plays the role as a natural?
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Why just 2%? Corporate taxes are 25-35% in industrialized countries.
The world is done listening to Donald Trump's government.
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@R padilla It's 2% of sales. The 21% average corporate tax you refer to applies to profits.
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@Peter Greiff
Thanks for the correction.
My point is they should have to create cost centres with separate P&L statements fully burdened by local operations.
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Another 'win' in international trade and relations for the U.S. of A. and the Trump administration. If I'm not mistaken, taxes paid to foreign governments are deductible from domestic tax liabilities. A net loss of revenue for our treasury department. Is anyone else tired of winning yet?
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@Jimmy
No, you are mistaken. If a US entity pays foreign taxes on income earned in a foreign jurisdiction the foreign taxes can usually be claimed as a credit against the US tax liability on the same income. The profits earned by these companies in Europe are earned in foreign subsidiaries where they are not taxed at all or barely taxed, therefore no or minimal foreign taxes are paid and the income is not reported in the US. The French initiative will simply taxthe portion of this income earned in France and will not affect US taxes paid.
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@gbc1
Where this will make a difference is in the consolidated earnings reported by these companies, which will be reduced by the new foreign tax costs, which may reduce the value of the stock.
In these countries imposing the taxes, they have a more fair tax system rewarding a greater proportion of people regardless of wealth including an all inclusive safety net. They must tax everyone fairly to maintain stability.
We don't do that. We tax the least powerful to protect the powerful. This is simply the more fair saying to the unfair what the majority of Americans are saying to, that corporations need to pay their fair share so everybody gains from their input into the overall economy.
The question isn't whether these foreign taxes are unfair, it's why don't and haven't we been collecting them all this time?
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Wealthy corporations being expected to pay taxes? Horrors! Socialists! So glad the taxes on my middle class American income went up under Trump so I could help subsidize Zuckerberg's lifestyle. It's my patriotic duty, no?
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Heaven forbid that companies should pay taxes on their revenue. Remember (1) salaries/wages are expenses and deducted from profits for tax purposes and (2) the Supreme Court ruled companies are "people". In the US companies are "special people" who don't have to pay much or any tax. (Kinda like our acting President. )
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@VM. “All animals are equal but some are more equal than others.” Don’t let anyone sucker you into thinking that socialism is the only form of government in which some people working in government are given higher and special status. When capitalism “captures” government the same thing holds true. Here in the US it is our capitalist corporations that are assumed to be better than everyone else and deserving of special treatment.
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I'm not sure why the Trump Administration thinks they'll win this
battle, considering how they've devalued diplomacy and jeopardized international relations.
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"Digital Revenue Grab?"
From companies that have lobbied and lobbied not to pay their rightful share of tax in the first place? That went to Europe to purposely avoid paying taxes?
What kind of baloney is this?
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@Dundeemundee And many companies and people have "Off Shore" shell companies and accounts.
It's the taxes stupid!
You are right on target! thanks
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I applaud France for pushing the envelope. The race to the bottom has depreciated the value of infrastructure at the local level here to the breaking point. Time to start paying for the roads, bridges, and educated work force used to generate trillions in revenue. Call me a socialist but you guys didn't build those businesses, we did. You just caught the rent.
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The tech companies have been sheltering their European profits in low/no tax foreign jurisdictions since inception. The techniques these companies use to achieve this are transparently bogus. Why should the US try to broker a deal to allow these poractices to continue? And does the US have the goodwill in trade matters to pull that off anyway? Clearly not. And how much negotioating capital is Trump prepared to spend to preserve this tax rip-off, it is not as if this would save jobs in the US. The fair way to tax these companies is to treat their profits as if earned in each country proportionate to their revenues from the country. Same is true with state income taxes on revenues earned in the US. Of course the same rules should apply for US taxation of foreign companies with revenues in the US. Fair taxation has not caught up with internet businesses yet and it is high time it did.
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“Transparently bogus”—my nomination for phrase of the year.
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@gbc1 Exactly. Local profit reporting has become meaningless, internal multinational transfer pricing just moves it to the “right” country. Taxing revenue is not ideal but the only possibility left to local governments to make corporations pay a fair share for the services they rely on (justice system, police, roads, etc.).
These tech companies also hardly create local jobs beyond a small sales representation and sometimes a bit of incremental logistics, that doesn’t help either.
1
@Liz
Yes Liz, see this article in the Guardian:
"Google shifted $23bn to tax haven Bermuda in 2017, filing shows" https://www.theguardian.com/technology/2019/jan/03/google-tax-haven-bermuda-netherlands
Explain to me how it is not absurd that a company can shift $23.0 billion in income from one jurisdiction to another to reduce taxes to $0.00 with no material change in its business operations. The Trump administration is going to defend that? How?
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The US administration interested in a coordinated approach, Mr Mnuchin? Wow, haven’t heard that for a while.
Apart from making Tech Giants at least pay some tax, there might even be other benefits - like showing that cooperation often beats confrontation. Thanks, France!
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If McConnell is heavily involved, then you know the vote does not favor the average American.
For my lifetime, I've only heard how difficult it is for corporations, especially multinationals. When will profit, and the obscene pay levels of U.S. corporate executives, take a back seat to helping the average American.
What needs to be discussed here is not only the low corporate tax rate of 21%, but the effective tax rate of U.S. corporations. We know that corporations like Facebook, Google, Alphabet, Amazon pay nothing. Some like Amazon get money back.
If it's pitch by McConnell, the doing nothing leader of the Party of NO, then there is no hope for the average American.
Thank God, for the EU.
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Trump has opened a Pandora's Box on trade and I am not sure our dysfunctional government will easily fix things.
17
Tech is lucky France does not simply rule that revenue from digital advertising is sourced where the ads run. Then the ad revenue would be taxed at normal corporate income tax rates. That is up to 33% in France.
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@Garak
33% to be progessively reduced to 25% in 2022.
Does the USA also have a standard corporate tax on profits ? I suppose tech companies also evade this one ?
I think we can't tax the profits by the standard method because of a treaty signed between France and Ireland in 1968 (before Ireland joined the ancester of the EU, and before the existance of tech companies).
2
Decades ago, a number of American states developed a remedy to income tax avoidance by multinational corporations. That remedy is unitary combined reporting on a worldwide basis - also known as formulary apportionment on a worldwide basis - also know as unitary taxation (Margaret Thatcher's term for taxing multinationals).
First tested at the US Supreme Court in 1983 in Container Corp. v. California, this method was approved by a vote of 5-3 (Justice Stevens did not participate in this case but did vote to approve in the later cases). Container was preceded by Mobil v. Vermont and Exxon v. Wisconsin decided in 1980 where the Court stated that the unitary-business principle was the linchpin of formulary apportionment in taxing multistage business enterprises. In doing so, the Court rejected the corporations' separate accounting method of segregating profits (now renamed territorial taxation which the 2017 GOP tax bill adopted).
The US Supreme Court re-visited unitary combined reporting on a worldwide basis in 1994 in two cases: Barclays Bank, based in Britain, and Colgate-Palmolive, based in the US. The votes in favor of California utilizing unitary taxation this time were 7-2 and 9-0, respectively. A slam dunk for California and every other state.
So how many states use this method today? One. Alaska has continued to apply this method but only on oil & gas multinationals.
Why only one? Thatcher and Reagan.
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@Nancy Thanks to Maggie and Ron, most states have adopted what is know as the water's edge combined reporting method that excludes (rather than includes) the profits of foreign subsidiaries in a state's pre-apportionment tax base. This is nothing more than a form of separate accounting that was rejected by the US Supreme Court.
The biggest beneficiaries are, surprise, foreign based multinationals operating in the US. Why, because the pre-tax US profits that they shift offshore are NOT subject to repatriation.
There are three videos on YouTube that are worth watching: Taxodus, The Town that Took on the Taxman, and The Spider's Web - Britain's Second Empire. Another, not on YouTube, is The UK Gold about The City aka the Square Mile, London's Financial Centre, where corporations get to vote and outnumber the residents there.
8
@Nancy Thanks to Maggie and Ron, most states have adopted what is know as the water's edge combined reporting method that excludes (rather than includes) the profits of foreign subsidiaries in a state's pre-apportionment tax base. This is nothing more than a form of separate accounting that was rejected by the US Supreme Court.
The biggest beneficiaries are, surprise, foreign based multinationals operating in the US. Why, because the pre-tax US profits that they shift offshore are NOT subject to repatriation.
There are three videos on YouTube that are worth watching: Taxodus, The Town that Took on the Taxman, and The Spider's Web - Britain's Second Empire. Another, not on YouTube, is The UK Gold about The City aka the Square Mile, London's Financial Centre, where corporations get to vote and outnumber the residents there.
3
I have long looked at Europe and her attempts to stand up for her own people with sadness and frustration. This tax was first proposed years ago, and it would have been fair and advantageous years ago. Sadly, diplomatic pressure from the US won out and the tax was never implemented. Europe just kept on wanting to be friends and not anger people. If this tax is implemented, it will be a grand day. It will be the day when a European government finally grew a spine in their negotiations with the US.
That is an accomplishment that is only possible thanks to Donald Trump and Brexit. These two new forces have marked the end of polite diplomacy and a new era in which the lobbyists pen is no longer mightier than the sword of European national interests. This is both frightening and appealing to almost any self respecting member of the old world, right wing or left.
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American companies all over the world have always encouraged "free repatriation of capital". Mostly exercised in developing economies. Many companies would not invest in those countries unless the local laws would allow them to get their revenue "back home" or transferred to other subsidiaries for tax efficiency purposes. That is a business model that applies to digital companies as well.
When you are the first economy of the world you can set the standards and the double standards. When other developed countries are your allies, you can keep that status quo for corporations and "group of friends".
However, when you become a foe to your allies and, those allies are developed countries too, things like this happen. Somebody should explain to Trump that he gave up global leadership in order to play to his base. To be a selective isolationist requires skills foreign to this administration. He is good at parochial politics. That is useless for diplomacy.
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@Aurace Rengifo
If this is in retaliation for Trump's actions, should we assume that France doesn't like its lucrative business dealings with Iran to have been threatened by the US abandonment of the Iranian deal? Follow the money, as Americans like to say.
1
In current account balance between EU and USA the huge American trade deficits Mr.Trump is focussed on all the time are offset by big services surpluses.
EU has deliberately looked the other side when it came to regulation and taxation of American tech and service giants to reach such general balance.
The well known tariff threats by Mr. Trump will knock off this over-all balance on the expense of EU so taxation of American tech giants according to French efforts is designed as countermeasure of this unsettling to be feared.
German exporters are not interested in the related change of taxation system because the present system is better for them as strongest exporters of goods in EU as it is for US companies as strong exporters of (digital) services also. Therefore Germany is NOT member of this action group. So Mr. Mnuchin who is fully aware of German blocking efforts so he was able to stop these ongoing plans of many other EU members until now.
But due to Mr. Trump´s increasing trade war efforts and intensifying threats against import of manufactured goods from Europe that is going to hit German industry the hardest this system change will have it´s way due to the unavoidable tit-for-tat-retaliation in this case. These efforts look like the preparations. All parties are entrenching theirselves for November. If Mr. Trump does what is he is talking about - this means: Making the cold trade war hot - German resistance will be baseless then.
8
The UK government would prefer reform of the international corporate tax rules through G7, G20 and OECD proposed reform, but has introduced the Digital Services Tax (at 2%) with effect from April 2020 in despair at the slow pace of international consensus building and reform. Nevertheless the future dis-application of this tax has been written in to the legislation to allow its removal if and when a better international tax solution is put in place.
The Digital Services Taz is explicitly not an anti-US tariff type change, but rather a recognition of (some of) the competitive disadvantages that bricks-and-mortar companies face in paying taxes on transactions and assets based in "the real world" that digital competitors are not liable to.
It would be much better to address fair competition issues through the closure of international tax loopholes such as those egregiously implemented by Ireland, Luxembourg, Cyprus etc and ensure that transaction taxes accrue to the territories in which transactions occur leaving the profits that those transactions generate to be taxed in an international tax regime that discourages tax-shopping between jurisdictions and closes money-laundering holes.
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@longsummer
I agree except that your solution requires two rational actors involved in these negotiations; not Mark Zuckerberg and Donald Trump.
5
@longsummer ...seems you graciously forgot to mention all those loopholes that England is providing through its financial "institutions." Nontheless, the "special relation" was given another treat recently, -almost non mentioned in the media here-, as our buffon in chief added 4 billion worth of tariffs to scotch, and Irish whiskies, french cheeses and Wine, Italian pasta, and so on....I guess, it is the minimum France and the EU can do to start going after companies which do not pay taxes at all, anywhere....
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@longsummer
"It would be much better to address fair competition issues through the closure of international tax loopholes such as those egregiously implemented by Ireland, Luxembourg, Cyprus etc and ensure that transaction taxes accrue to the territories in which transactions occur leaving the profits that those transactions generate to be taxed in an international tax regime that discourages tax-shopping between jurisdictions and closes money-laundering holes."
Amen to that! I just wish I could be more optimistic about the commitment to such international solutions in Boris Johnson's post-Brexit UK.
1
Tax the companies. Ignore the U.S. whose government is controlled by corporations. I hope the Democrats do not support any McConnell bill to protect the tech companies.
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@June Manchin will, then he'll "regret" it.
3
@June
I wish it was just the Party of Trump here, as I hate them so much, but it was the Dems who voted against the big fat Facebook fine...
Trade wars are so fun and easy to win per Donald Trump. Let’s go it alone, no more multi lateral partnerships or treaties. Therefore, the U.S. gives up on the Paris Climate Agreement, TPP, etc. Now we’re concerned that other countries want to establish trade and tax rules without consideration of the U.S.? Our quest for unilateral agreements has, and will continue to cause harm to this nation’s leadership and reputation in world affairs.
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Re: "As Europe moves to Tax Tech Companies
It's France, not Europe, and its driven by Macron's need to find new revenue after eliminating the wealth on capital, private planes, yachts etc, limiting it to real estate, and handing out concession to the yellow vests that revolted against his politics of codling les plus riches
As to "Washington" it is both Republican and Democrats that oppose the French move.
When it comes to shielding "US" companies (They are really global companies, not US companies) against foreign taxes the parties unite
Partisan Politics Ends at the Water's Edge
Senator Arthur Vandenberg (1884-1951)
8
Except for the times that Russia hacks into our elections and the Republican party supports them.
1
@Woof Both parties are in US corporation's pockets, so that's no surprise.
As for your point on taxes, the OECD has been talking about reforming taxation on digital companies (most of whom contribute little in the way of tax revenues) for several years now, with no real progress. France has run out of patience, as have several other European nations.
The proportion of government revenues that come from corporations has been declining across the developed world for decades now, even as their profits have soared to record levels. The proportion of tax revenues that comes from taxing workers has risen in compensation. When the tech companies avoid taxation, it's ordinary people who pick up the tab, to fund the public services that they - and the corporations - need.
And companies that are founded in the US, headquartered in the US, are listed in the US, have US leaders and mostly US boards of directors, which report in the US, and do the US government's bidding (e.g. enabling the US governments eavesdropping programmes) are US companies with international operations. The US government wouldn't be upset by France's move if it didn't regard these companies as American.
1
@Woof
Utter rubbish.
France goes ahead after the EU could not agree internally. Tax matters require unanimity in the EU and a few countries blocked, in particular Ireland which lures US tech with very low tax rates. The same tax is in preparation in at least 5 other EU countries. It is absolutely not related to Macron or the yellow vests.
4