5 ms·

You do understand it's a two way street? There is a trade imbalance between EU and US aprox 30% in favor of EU. If your point of view prevails EU will loose tax

by qaq 10y ago

You do understand it's a two way street? There is a trade imbalance between EU and US aprox 30% in favor of EU. If your point of view prevails EU will loose tax revenue and US will gain tax revenue :).

themihai 10y ago
How is that? Does US has sweetheart deals with EU companies? I highly doubt.
- deleted 10y ago
  [deleted]
- twoodfin 10y ago
  Of course it does. Volkswagen has gotten hundreds of millions of dollars worth of incentives from the state of Tennessee for its Chattanooga plant, for example. http://www.timesfreepress.com/news/business/aroundregion/story/2014/jul/15/state-local-governments-boost-incentives-to-lure/252206/ http://www.timesfreepress.com/news/business/aroundregion/sto...
  - themihai 10y ago
    I think it's a bit different because it looks like an investment from the government(i.e. public-private partnerships) not a tax break.
    - qaq 10y ago
      "Combined with other property tax breaks, TVA incentives, road projects and other potential tax credits, Volkswagen could qualify for more than $300 million of grants" what is different about this?
      - themihai 10y ago
        Indeed that's the case though I can't say that I agree with them. The main reason is because these 'special' deals stifle competition and I think that's what the EC rule is all about. I guess it's legal in the US but that doesn't make it "right"(at least in the EU) so I don't mind if the US would tax EU companies more. It would be a win-win for the most of the citizens(EU and US).
        qaq 10y ago
        It would be Net loss for EU.
        themihai 10y ago
        I think it would be a win for ordinary citizens(both EU and US) and perhaps each individual state too(unless you consider tax a bad thing) because the taxes help the governments to develop the infrastructure(i.e. schools, logistics etc) thus they can create more value. I have doubts that these MNCs help the society that much to be eligible for these tax breaks. They are not charities... The loss for the EU as a economic partner is negligible.
dogma1138 10y ago
The bigger problem is that it's a two way street within the EU. The "smaller" economies have to give incentive to large corporations so they could set up shop. Ireland did it with various incentives, Poland, Estonia and the likes are also doing it with others. Ireland is in the Eurozone so they can't set up their own monetary policy so they can't offer much in terms of favorable interest and conversion rates to large corporations. If they can't offer tax incentives companies would be less inclined to set up shop in Ireland if their operating costs would be similar to those in Germany or France. English gives Ireland some advantage but it's not nearly as big as people think, the culture in Germany or France is close enough and you can train people to speak English and with the shared market even import a few 1000's Irish to man the phones. Apple and the other big guys set up their shop in Ireland because the Irish government gave out huge incentive both direct and indirect it provided funding for training and education for its residents to meet the specific requirements that companies like Apple, Google, and Facebook had. It provided financing, loans and tax breaks to those companies to come in and employ Irish workers and it did it because it's the only way it could compete with the likes of Germany. Tax loopholes are bad, laws that prevent smaller countries from being competitive are even worse, an equal playing field works when the players are equal, when they aren't "equality" is only advantageous to the strong and established players.

by qaq 10y ago

themihai 10y ago

How is that? Does US has sweetheart deals with EU companies? I highly doubt.

deleted 10y ago
[deleted]
twoodfin 10y ago
Of course it does. Volkswagen has gotten hundreds of millions of dollars worth of incentives from the state of Tennessee for its Chattanooga plant, for example. http://www.timesfreepress.com/news/business/aroundregion/story/2014/jul/15/state-local-governments-boost-incentives-to-lure/252206/ http://www.timesfreepress.com/news/business/aroundregion/sto...
- themihai 10y ago
  I think it's a bit different because it looks like an investment from the government(i.e. public-private partnerships) not a tax break.
  - qaq 10y ago
    "Combined with other property tax breaks, TVA incentives, road projects and other potential tax credits, Volkswagen could qualify for more than $300 million of grants" what is different about this?
    - themihai 10y ago
      Indeed that's the case though I can't say that I agree with them. The main reason is because these 'special' deals stifle competition and I think that's what the EC rule is all about. I guess it's legal in the US but that doesn't make it "right"(at least in the EU) so I don't mind if the US would tax EU companies more. It would be a win-win for the most of the citizens(EU and US).
      - qaq 10y ago
        It would be Net loss for EU.
        themihai 10y ago
        I think it would be a win for ordinary citizens(both EU and US) and perhaps each individual state too(unless you consider tax a bad thing) because the taxes help the governments to develop the infrastructure(i.e. schools, logistics etc) thus they can create more value. I have doubts that these MNCs help the society that much to be eligible for these tax breaks. They are not charities... The loss for the EU as a economic partner is negligible.

dogma1138 10y ago

The bigger problem is that it's a two way street within the EU. The "smaller" economies have to give incentive to large corporations so they could set up shop. Ireland did it with various incentives, Poland, Estonia and the likes are also doing it with others. Ireland is in the Eurozone so they can't set up their own monetary policy so they can't offer much in terms of favorable interest and conversion rates to large corporations. If they can't offer tax incentives companies would be less inclined to set up shop in Ireland if their operating costs would be similar to those in Germany or France. English gives Ireland some advantage but it's not nearly as big as people think, the culture in Germany or France is close enough and you can train people to speak English and with the shared market even import a few 1000's Irish to man the phones. Apple and the other big guys set up their shop in Ireland because the Irish government gave out huge incentive both direct and indirect it provided funding for training and education for its residents to meet the specific requirements that companies like Apple, Google, and Facebook had. It provided financing, loans and tax breaks to those companies to come in and employ Irish workers and it did it because it's the only way it could compete with the likes of Germany. Tax loopholes are bad, laws that prevent smaller countries from being competitive are even worse, an equal playing field works when the players are equal, when they aren't "equality" is only advantageous to the strong and established players.