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>So this is money made from EU based users and revenue they make from them. That's a gross oversimplification. Especially with the internet, it's not clear any

>So this is money made from EU based users and revenue they make from them. That's a gross oversimplification. Especially with the internet, it's not clear anymore. Let's say that I live in Thailand, have US citizenship, sell products on Amazon in England, ship to France, and then advertise on Google. Who do I pay taxes to and at what rate? Provenance of profit is not easy. You're paying Amazon a cut for shipping/fulfillment, and Google for the ad revenue, but your customer is a French national and you're a US citizen but currently residing in Thailand.

deleted 9y ago
[deleted]
sjg007 9y ago
It's pretty clear. You are selling in the UK so the revenue would be taxed there. Post-brexit the French customer will pay customs duty. The Google ad revenue will be paid by Google based on the market. So the ad run in France generates EU revenue. Doesn't matter if the payor was an American or anyone else. If you are US citizen then you pay world wide income tax. You can deduct foreign taxes paid up to a limit. Better to actually incorporate though so you can pay less tax.
- jimmywanger 9y ago
  > It's pretty clear. You are selling in the UK so the revenue would be taxed there. It's not clear at all. Your warehouse is in the states (or where ever) and the goods are never in the UK. For all cross-border shipments you have to pay customs tax. Just because somebody saw your product on a co.uk website you have to pay the UK for what exactly? And as you brought up, there are customs taxes as well as income taxes. Why are these artificial delineations good for business?
  - jackvalentine 9y ago
    What is the business purpose of using amazon.co.uk rather than Amazon US if you're warehousing in the US and shipping worldwide?
    - jimmywanger 9y ago
      I can think of a few off the top of my head. Bouncycastle (a crypto library) is hosted in Australia because I think the US crypt laws want to ban the export (download) of military grade munitions. Great Gatsby (the novel) is free to download if hosted in Australia. In the US, the copyright laws forbid the download of Great Gatsby mainly because of Disney. Ever wonder why Mickey Mouse isn't in public domain? Also, if your product that you can source cheaper over in the US is only popular in England, you would of course go to England's Amazon and eBay sites to sell it. For instance, umbrellas won't sell as well in Arizona as they would in England.
      - lovich 9y ago
        Is hosting not analogous to warehouseing? I mean if you warehouse pot in the us and sell in Amsterdam you're still violating local laws based on where your warehouse is and if you host the great Gatsby in the us to deliver to Australia then you're violating local laws where you are hosting too. You can reverse it and have pot in the Netherlands or great Gatsby in Australia to send to the US, but weve had the term smuggling to cover that situation as well
        jimmywanger 9y ago
        > Is hosting not analogous to warehouseing? It's not clear what is and what is not being hosted. Let's take Google for an example. Google has datacenters all over the world. You could make a case that Gmail makes no money on its own, that all the money comes from ads. Fine, host all the servers that serve Gmail on its own in a local country to reduce latency, and serve all ads from a server in a tax haven. Who do you tax? The tax haven has no taxes, and Gmail itself is a net expense, as you have to pay for labor, servers, power, and bandwidth. > You can reverse it and have pot in the Netherlands or great Gatsby in Australia to send to the US, but weve had the term smuggling to cover that situation as well. That is incorrect. You can download Great Gatsby instantly in the US right now[0]. Project Gutenberg prevents German users from downloading books[1]. All these extra laws are doing is making it so new companies have more hoops to jump through and large existing companies have the lawyers and money to figure out how to skirt the rules. [0] http://gutenberg.net.au/ebooks02/0200041.txt http://gutenberg.net.au/ebooks02/0200041.txt Don't download if you're in the states. [1] https://goodereader.com/blog/e-book-news/project-gutenberg-blocks-german-users-from-downloading-ebooks https://goodereader.com/blog/e-book-news/project-gutenberg-b...
  - sjg007 9y ago
    I don't think you understand how international commerce actually works. If your warehouse is in the USA and someone from the UK orders from you, you can ship the product to them tax free but they will pay an import duty on that item based on the UK value of the item. Google has to pay tax on the advertisement to the UK buyer. This is because the revenue (aka the user clicking on the ad to buy your widget) was advertised in the UK and thus generated revenue in the UK. That's what the 3% tax is on. It doesn't matter if you hosted the ad in the USA or Thailand or on the space station. All that matters is that the consumer "purchased" the ad. The advertiser pays google the ad fee and google pays the state the tax. Simple and straightforward.
    - jimmywanger 9y ago
      You're not counting ppv ads. If you click on a webpage, and the advertisers get some money from you clicking on the link, you're going to get taxed even though you did not really do anything? Please explain that to me. How you can be forced into being a tax liability for a company.
- nothrabannosir 9y ago
  > Post-brexit the French customer will pay customs duty. Out of interest: Would they? This is an EU law, so that would assume UK kept it after brexit , either specifically or through some wholesale “fork all the trade laws”. But it would also imply a lack of inter-European treaties, i.e. fork the laws but don’t keep the treaties. I haven’t kept fully up to date with the latest brexit developments , are we far enough along in the negotiations to know this stuff yet? Last I heard it was still a complete s*show :/
  - dtech 9y ago
    The default on EU imports is customs duty. Certain countries (iirc Switserland, Norway and a few others) have trade agreements that waive the fees both ways. I assume at time of brexit UK will have such a treaty, but it isn't guaranteed.
  - ben_w 9y ago
    IIUC, all trade from UK to EU will be subject to customs checks & tariffs, because the UK government is more likely to collapse than accept continued membership of the single market/customs union. Simultaneously, the UK government lacks the capacity to enforce significant customs or border checks in the other direction, so will accept almost (but not quite) all imports from the EU blindly.
candiodari 9y ago
> Let's say that I live in Thailand, have US citizenship, sell products on Amazon in England, ship to France, and then advertise on Google. Who do I pay taxes to and at what rate? You know there's a technical answer to this question. But the answer is pretty predictable : everyone. Taxes on income in Thailand. Taxes on income in US. Taxes on shipping, though pretty much only in the arriving port and several places your shipment might pass (e.g. the Suez Canal) Taxes on selling in England and France. VAT France and England. There are plenty of companies that can help you with this. For an extra fee, of course. And don't think for a second states will help you figure out taxes for free, or even mention/warn you that you need to do it. Is it financially and logistically realistic for any normal sized company to do anything other than ignore the situation and fraudulently forget about taxes ? No. What will European states do about that ? Nothing. Well, unless you count utterly destroying a few unlucky token merchants.
- jimmywanger 9y ago
  > You know there's a technical answer to this question. Not really a satisfying one, as you pointed out. > Taxes on income in Thailand. > Taxes on income in US. Well, you don't have any income. You send all your profits to a shell company in some tax shelter somewhere (Isle of Man is an example) and only withdraw what you need for day-to day expenses. You can pay taxes on the income sitting in the tax shelter, but I can remind you of the multiplicative properties of zero. > Taxes on selling in England and France. > VAT France and England. I agree with the VAT. What if you only had warehouses in a country with a better tax code, store all your inventory there and just ship to France and England. Host your servers there and use a static IP to redirect queries from a .co.uk domain to the same site with a .tv domain. What percentage of the sale should go to France, and what percentage should go to England?

deleted 9y ago

[deleted]

sjg007 9y ago

It's pretty clear. You are selling in the UK so the revenue would be taxed there. Post-brexit the French customer will pay customs duty. The Google ad revenue will be paid by Google based on the market. So the ad run in France generates EU revenue. Doesn't matter if the payor was an American or anyone else. If you are US citizen then you pay world wide income tax. You can deduct foreign taxes paid up to a limit. Better to actually incorporate though so you can pay less tax.

jimmywanger 9y ago
> It's pretty clear. You are selling in the UK so the revenue would be taxed there. It's not clear at all. Your warehouse is in the states (or where ever) and the goods are never in the UK. For all cross-border shipments you have to pay customs tax. Just because somebody saw your product on a co.uk website you have to pay the UK for what exactly? And as you brought up, there are customs taxes as well as income taxes. Why are these artificial delineations good for business?
- jackvalentine 9y ago
  What is the business purpose of using amazon.co.uk rather than Amazon US if you're warehousing in the US and shipping worldwide?
  - jimmywanger 9y ago
    I can think of a few off the top of my head. Bouncycastle (a crypto library) is hosted in Australia because I think the US crypt laws want to ban the export (download) of military grade munitions. Great Gatsby (the novel) is free to download if hosted in Australia. In the US, the copyright laws forbid the download of Great Gatsby mainly because of Disney. Ever wonder why Mickey Mouse isn't in public domain? Also, if your product that you can source cheaper over in the US is only popular in England, you would of course go to England's Amazon and eBay sites to sell it. For instance, umbrellas won't sell as well in Arizona as they would in England.
    - lovich 9y ago
      Is hosting not analogous to warehouseing? I mean if you warehouse pot in the us and sell in Amsterdam you're still violating local laws based on where your warehouse is and if you host the great Gatsby in the us to deliver to Australia then you're violating local laws where you are hosting too. You can reverse it and have pot in the Netherlands or great Gatsby in Australia to send to the US, but weve had the term smuggling to cover that situation as well
      - jimmywanger 9y ago
        > Is hosting not analogous to warehouseing? It's not clear what is and what is not being hosted. Let's take Google for an example. Google has datacenters all over the world. You could make a case that Gmail makes no money on its own, that all the money comes from ads. Fine, host all the servers that serve Gmail on its own in a local country to reduce latency, and serve all ads from a server in a tax haven. Who do you tax? The tax haven has no taxes, and Gmail itself is a net expense, as you have to pay for labor, servers, power, and bandwidth. > You can reverse it and have pot in the Netherlands or great Gatsby in Australia to send to the US, but weve had the term smuggling to cover that situation as well. That is incorrect. You can download Great Gatsby instantly in the US right now[0]. Project Gutenberg prevents German users from downloading books[1]. All these extra laws are doing is making it so new companies have more hoops to jump through and large existing companies have the lawyers and money to figure out how to skirt the rules. [0] http://gutenberg.net.au/ebooks02/0200041.txt http://gutenberg.net.au/ebooks02/0200041.txt Don't download if you're in the states. [1] https://goodereader.com/blog/e-book-news/project-gutenberg-blocks-german-users-from-downloading-ebooks https://goodereader.com/blog/e-book-news/project-gutenberg-b...
- sjg007 9y ago
  I don't think you understand how international commerce actually works. If your warehouse is in the USA and someone from the UK orders from you, you can ship the product to them tax free but they will pay an import duty on that item based on the UK value of the item. Google has to pay tax on the advertisement to the UK buyer. This is because the revenue (aka the user clicking on the ad to buy your widget) was advertised in the UK and thus generated revenue in the UK. That's what the 3% tax is on. It doesn't matter if you hosted the ad in the USA or Thailand or on the space station. All that matters is that the consumer "purchased" the ad. The advertiser pays google the ad fee and google pays the state the tax. Simple and straightforward.
  - jimmywanger 9y ago
    You're not counting ppv ads. If you click on a webpage, and the advertisers get some money from you clicking on the link, you're going to get taxed even though you did not really do anything? Please explain that to me. How you can be forced into being a tax liability for a company.
nothrabannosir 9y ago
> Post-brexit the French customer will pay customs duty. Out of interest: Would they? This is an EU law, so that would assume UK kept it after brexit , either specifically or through some wholesale “fork all the trade laws”. But it would also imply a lack of inter-European treaties, i.e. fork the laws but don’t keep the treaties. I haven’t kept fully up to date with the latest brexit developments , are we far enough along in the negotiations to know this stuff yet? Last I heard it was still a complete s*show :/
- dtech 9y ago
  The default on EU imports is customs duty. Certain countries (iirc Switserland, Norway and a few others) have trade agreements that waive the fees both ways. I assume at time of brexit UK will have such a treaty, but it isn't guaranteed.
- ben_w 9y ago
  IIUC, all trade from UK to EU will be subject to customs checks & tariffs, because the UK government is more likely to collapse than accept continued membership of the single market/customs union. Simultaneously, the UK government lacks the capacity to enforce significant customs or border checks in the other direction, so will accept almost (but not quite) all imports from the EU blindly.

candiodari 9y ago

> Let's say that I live in Thailand, have US citizenship, sell products on Amazon in England, ship to France, and then advertise on Google. Who do I pay taxes to and at what rate? You know there's a technical answer to this question. But the answer is pretty predictable : everyone. Taxes on income in Thailand. Taxes on income in US. Taxes on shipping, though pretty much only in the arriving port and several places your shipment might pass (e.g. the Suez Canal) Taxes on selling in England and France. VAT France and England. There are plenty of companies that can help you with this. For an extra fee, of course. And don't think for a second states will help you figure out taxes for free, or even mention/warn you that you need to do it. Is it financially and logistically realistic for any normal sized company to do anything other than ignore the situation and fraudulently forget about taxes ? No. What will European states do about that ? Nothing. Well, unless you count utterly destroying a few unlucky token merchants.

jimmywanger 9y ago
> You know there's a technical answer to this question. Not really a satisfying one, as you pointed out. > Taxes on income in Thailand. > Taxes on income in US. Well, you don't have any income. You send all your profits to a shell company in some tax shelter somewhere (Isle of Man is an example) and only withdraw what you need for day-to day expenses. You can pay taxes on the income sitting in the tax shelter, but I can remind you of the multiplicative properties of zero. > Taxes on selling in England and France. > VAT France and England. I agree with the VAT. What if you only had warehouses in a country with a better tax code, store all your inventory there and just ship to France and England. Host your servers there and use a static IP to redirect queries from a .co.uk domain to the same site with a .tv domain. What percentage of the sale should go to France, and what percentage should go to England?