3 ms·

I agree that tech companies do not pay their fair share of tax. But this is an EU tariff against US companies. Will any EU company be affected?

cyphar 8y ago
In order to get tax breaks from a country you must be incorporated in that country. So, tautologically, any company that would pay these EU taxes must be an EU company. In the most pedantic sense, this cannot affect US companies. However US (and other multinational) companies set up subsidiaries and then funnel money through them to get tax breaks thanks to bilateral double-taxation-avoidance agreements. These would be affected, but they've structured themselves this way intentionally so that their profits are collected in a company headquartered in the EU. (Though it should be noted that headquartering EU operations in an EU country is generally a requirement for dealing with EU consumers without tarrifs and so on, but many multinationals funnel their international money through the EU company). You can't have it both ways. Either you're an EU company which gives you certain tax breaks, or you're a US company that has no tax benefits in the EU for global revenue.
martinald 8y ago
spotify, SAP, etc?
freeflight 8y ago
If they are making similar use of tax evasion techniques then, yes [0]. Too many people here act like this is something specifically aimed at US companies, when in reality it's not. US companies just happen to be affected the most by it due to their dominance in this particular business sector. But this is something that has been long overdue and was bound to happen regardless of who was dominating that sector. [0] https://ec.europa.eu/taxation_customs/sites/taxation/files/proposal_significant_digital_presence_21032018_en.pdf https://ec.europa.eu/taxation_customs/sites/taxation/files/p...
- cyphar 8y ago
  It's aimed at companies incorporated in the EU. If a US company decided to incorporate a subsidiary in the EU to get tax breaks and other benefits, then it makes little sense (to me, at least) to complain about US companies being targeted. Some US companies specifically decided to structure themselves to be EU companies in name (and tax status) -- so from a practical perspective they are EU companies. You can't have it both ways. (Not to mention this will affect companies like SAP and Spotify, which are real EU companies.)
themihai 8y ago
What makes you think that EU companies are not "affected"? The tax is not on foreign companies thus is not a tariff. It's just a way to make the tax avoidance companies pay some tax.

cyphar 8y ago

In order to get tax breaks from a country you must be incorporated in that country. So, tautologically, any company that would pay these EU taxes must be an EU company. In the most pedantic sense, this cannot affect US companies. However US (and other multinational) companies set up subsidiaries and then funnel money through them to get tax breaks thanks to bilateral double-taxation-avoidance agreements. These would be affected, but they've structured themselves this way intentionally so that their profits are collected in a company headquartered in the EU. (Though it should be noted that headquartering EU operations in an EU country is generally a requirement for dealing with EU consumers without tarrifs and so on, but many multinationals funnel their international money through the EU company). You can't have it both ways. Either you're an EU company which gives you certain tax breaks, or you're a US company that has no tax benefits in the EU for global revenue.

martinald 8y ago

spotify, SAP, etc?

freeflight 8y ago

If they are making similar use of tax evasion techniques then, yes [0]. Too many people here act like this is something specifically aimed at US companies, when in reality it's not. US companies just happen to be affected the most by it due to their dominance in this particular business sector. But this is something that has been long overdue and was bound to happen regardless of who was dominating that sector. [0] https://ec.europa.eu/taxation_customs/sites/taxation/files/proposal_significant_digital_presence_21032018_en.pdf https://ec.europa.eu/taxation_customs/sites/taxation/files/p...

cyphar 8y ago
It's aimed at companies incorporated in the EU. If a US company decided to incorporate a subsidiary in the EU to get tax breaks and other benefits, then it makes little sense (to me, at least) to complain about US companies being targeted. Some US companies specifically decided to structure themselves to be EU companies in name (and tax status) -- so from a practical perspective they are EU companies. You can't have it both ways. (Not to mention this will affect companies like SAP and Spotify, which are real EU companies.)

themihai 8y ago

What makes you think that EU companies are not "affected"? The tax is not on foreign companies thus is not a tariff. It's just a way to make the tax avoidance companies pay some tax.