4 ms·

Can you expand a bit on the bureaucracy in Europe? Do you think it's hard to create a limited responsibility company in Europe? Is it better in China?

CM30 10y ago
Have you seen that law about taxes for ecommerce in Europe? In the US, the shop collects tax for the country the shop is based in. In Europe, the shop has to pay taxes related to the country the people buying the products are in. This significantly increases the complexity of running an ecommerce business in Europe. https://www.gov.uk/government/publications/vat-supplying-digital-services-to-private-consumers/vat-businesses-supplying-digital-services-to-private-consumers#eu-vat-rule-change https://www.gov.uk/government/publications/vat-supplying-dig... It was an idea with some logic behind it, but it basically cripples European internet businesses compared to US ones by making taxes that much complicated to calculate.
- eli_gottlieb 10y ago
  > In the US, the shop collects tax for the country the shop is based in. Legally, Americans are obligated to pay sales tax for internet purchases in the state where we live. There's a form for it, every year. The American move is to shift the burden of tax collection onto the customer, thus ensuring that the taxes are evaded rather than paid. I don't really see moving bureaucracy onto customers rather than businesses - thus increasing the total amount of records that must be kept and paperwork that must be filed to abide perfectly by the law and pay one's taxes - as a good thing.
- officialchicken 10y ago
  Agree. But it's not too bad as long as the companies require invoice (in EU sense of the term) to include VAT/VIES/CIF. The cost or price of an outside accountant to deal with your tech is not too affordable for a startup... 20,000+ euro/year just to do the book keeping.
anexprogrammer 10y ago
Creating a company, at least in the UK is extremely simple. The one stop VAT rules CM30 mentioned have been onerous enough to stop smaller ecommerce places going EU wide. There were a lot of blog posts about it not being worth the hassle around the time of it's introduction. But it's not just the bureaucracy, at least in the UK. It's the perception and treatment after a failure. It almost damns you for life. The banks won't want to lend, VCs here seem to want more of a sure thing. There seems to be little of the US attitude of "OK you failed, what you going to try next?". OK that was a lot of sweeping generalisations, and there are exceptions to the rule, but you get the idea.
officialchicken 10y ago
I've recently given up trying in the EU (for now). In the US, it's really easy (rocketlawyer.com/square.com), here it's a relative nightmare. From accounting and taxes to liability to contract and employment law to even relatively simple things like opening a bank account it's not startup friendly. IMO, most of the EU regulations and frameworks were developed within the confines of local low-risk capitalized companies, such as agriculture or hair salons. And as soon as you try to move money outside the EU, you might as well throw it in a bonfire.
- walshemj 10y ago
  It takes less than a week to set up a company in the UK

CM30 10y ago

Have you seen that law about taxes for ecommerce in Europe? In the US, the shop collects tax for the country the shop is based in. In Europe, the shop has to pay taxes related to the country the people buying the products are in. This significantly increases the complexity of running an ecommerce business in Europe. https://www.gov.uk/government/publications/vat-supplying-digital-services-to-private-consumers/vat-businesses-supplying-digital-services-to-private-consumers#eu-vat-rule-change https://www.gov.uk/government/publications/vat-supplying-dig... It was an idea with some logic behind it, but it basically cripples European internet businesses compared to US ones by making taxes that much complicated to calculate.

eli_gottlieb 10y ago
> In the US, the shop collects tax for the country the shop is based in. Legally, Americans are obligated to pay sales tax for internet purchases in the state where we live. There's a form for it, every year. The American move is to shift the burden of tax collection onto the customer, thus ensuring that the taxes are evaded rather than paid. I don't really see moving bureaucracy onto customers rather than businesses - thus increasing the total amount of records that must be kept and paperwork that must be filed to abide perfectly by the law and pay one's taxes - as a good thing.
officialchicken 10y ago
Agree. But it's not too bad as long as the companies require invoice (in EU sense of the term) to include VAT/VIES/CIF. The cost or price of an outside accountant to deal with your tech is not too affordable for a startup... 20,000+ euro/year just to do the book keeping.

anexprogrammer 10y ago

Creating a company, at least in the UK is extremely simple. The one stop VAT rules CM30 mentioned have been onerous enough to stop smaller ecommerce places going EU wide. There were a lot of blog posts about it not being worth the hassle around the time of it's introduction. But it's not just the bureaucracy, at least in the UK. It's the perception and treatment after a failure. It almost damns you for life. The banks won't want to lend, VCs here seem to want more of a sure thing. There seems to be little of the US attitude of "OK you failed, what you going to try next?". OK that was a lot of sweeping generalisations, and there are exceptions to the rule, but you get the idea.

officialchicken 10y ago

I've recently given up trying in the EU (for now). In the US, it's really easy (rocketlawyer.com/square.com), here it's a relative nightmare. From accounting and taxes to liability to contract and employment law to even relatively simple things like opening a bank account it's not startup friendly. IMO, most of the EU regulations and frameworks were developed within the confines of local low-risk capitalized companies, such as agriculture or hair salons. And as soon as you try to move money outside the EU, you might as well throw it in a bonfire.

walshemj 10y ago
It takes less than a week to set up a company in the UK