4 ms·
That comment is obviously wrong, proven easily by taking the extreme case of the policy applying to all employers: none of them paying taxes would quickly ruin
by shaki-dora 8y ago
That comment is obviously wrong, proven easily by taking the extreme case of the policy applying to all employers: none of them paying taxes would quickly ruin any country, yes. But everyone being unemployed would get you to the same miserable state even faster.
But the argument doesn't have to be as extreme as that to support enforcement of some sort of equitable taxation: Take, again, the extreme case of the policy applying to all employers. That's broadly equivalent to abolishing corporate taxation PLUS that corporate windfall accumulating not in the countries they operate in, but whatever happens to be the go-to tax haven.
This being taxes on profits, there's zero effect on the company's activity (i. e. investment, hiring etc.) in the country. That's because Facebook will let someone in, say, Brasil, spend $5000 on ads irregardless of them having to give half of that to the local government. It's either $2500 or $5000 in profits, produced with 0 marginal costs.
Net result therefore is a zero-sum game between that government, and Facebook's shareholders. Even ignoring the geographic aspect (very little of Facebook's shareholders being likely to spend that money in Brasil), it seems rather intuitive that the public is better served by the money taking another lap paying for some school, rather than allowing some retired VC to improve the decorations on his next yacht.