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>I disagree with that framework but applying taxes arbitrarily hardly seems fair or the best way to raise revenue. There's nothing arbitrary here, in fact they

>I disagree with that framework but applying taxes arbitrarily hardly seems fair or the best way to raise revenue. There's nothing arbitrary here, in fact they're attempting to partially address a perverse incentive to take all your business online and do some jurisdiction arbitrage to minimize corporate taxes. This gives you an unfair advantage over, say, a brick-and-mortar store or a physical ad agency in Paris that's trying to compete online. Taxes are not just about revenue, they are often about changing incentives (for the better if used well, for the worse if used without regard for unintended consequences). >Much of the edge Amazon has versus local retailers is that it is more efficient. Much, but not all. This addresses an additional edge Amazon has versus local retailers.

jtx22 7y ago
Who says we even need brick and mortar anything? Why would the government artificially support that way of delivering goods and services?
weberc2 7y ago
I'm trying to follow the argument in good faith, so bear with me... > This gives you an unfair advantage over, say, a brick-and-mortar store or a physical ad agency in Paris that's trying to compete online. Are you sure it's "an unfair advantage" and not just "an advantage"? Doesn't your position presume that the brick-and-mortar business model deserves special protection? If so, why? If not, what then is unfair about "jurisdiction arbitrage". > Taxes are not just about revenue, they are often about changing incentives What is the implied incentive in this case? It seems like it's just incentivizing a brick and mortar business model, but it's not clear why this is inherently virtuous. > This addresses an additional edge Amazon has versus local retailers. Doesn't this all point to a fundamental problem with "corporate tax"? Wouldn't it be better (fairer) to reduce or remove corporate tax and raise sales tax or similar, such that it doesn't matter whether the business has a presence in the country in question? I'm not very knowledgable about the topic, so I'm hoping someone can set me straight.
- 99052882514569 7y ago
  >Are you sure it's "an unfair advantage" and not just "an advantage"? Doesn't your position presume that the brick-and-mortar business model deserves special protection? If so, why? Because it employs more people and pays taxes locally. It's perfectly valid for the government to ignore that and focus solely on the consumer side (i.e. minimize prices), but it's also perfectly valid (and economically sound) to do what France is doing. >What is the implied incentive in this case? It seems like it's just incentivizing a brick and mortar business model No, it is not incentivizing it. It levels the playing field a bit by applying more consistent taxation. >Doesn't this all point to a fundamental problem with "corporate tax"? Wouldn't it be better (fairer) to reduce or remove corporate tax and raise sales tax or similar, such that it doesn't matter whether the business has a presence in the country in question? I can be persuaded by that argument (economists do love consumption taxes for a reason, after all), but either way it's not for Amazon to decide. In France, it is for the French people to decide, via their representatives. Whatever positive or negative consequences arise are also theirs to bear.
  - da_chicken 7y ago
    > > Doesn't this all point to a fundamental problem with "corporate tax"? Wouldn't it be better (fairer) to reduce or remove corporate tax and raise sales tax or similar, such that it doesn't matter whether the business has a presence in the country in question? Well, now you run into the problem of progressive vs regressive taxation. Since consumption taxes, as the name implies, tax consumption, and the poor have a marginal propensity to consume of almost 1.0 while the wealthy can have an extremely low marginal propensity to consume, it's reasonable to conclude that consumption taxes are taxing the people who are least able to pay and who would already be spending that money anyways. You're taking away money that would already have stimulated the economy elsewhere. Taxing the poor runs into these kind of zero-sum problems much more quickly. The rich tend to save or are more able to engage in activities which produce products of much more questionable economic value (i.e., bitcoin farms, copyright trolls, rent-seeking, etc.). Obviously investment has value, but in economic terms it may or may not generate a commensurate amount of wealth.

jtx22 7y ago

Who says we even need brick and mortar anything? Why would the government artificially support that way of delivering goods and services?

weberc2 7y ago

I'm trying to follow the argument in good faith, so bear with me... > This gives you an unfair advantage over, say, a brick-and-mortar store or a physical ad agency in Paris that's trying to compete online. Are you sure it's "an unfair advantage" and not just "an advantage"? Doesn't your position presume that the brick-and-mortar business model deserves special protection? If so, why? If not, what then is unfair about "jurisdiction arbitrage". > Taxes are not just about revenue, they are often about changing incentives What is the implied incentive in this case? It seems like it's just incentivizing a brick and mortar business model, but it's not clear why this is inherently virtuous. > This addresses an additional edge Amazon has versus local retailers. Doesn't this all point to a fundamental problem with "corporate tax"? Wouldn't it be better (fairer) to reduce or remove corporate tax and raise sales tax or similar, such that it doesn't matter whether the business has a presence in the country in question? I'm not very knowledgable about the topic, so I'm hoping someone can set me straight.

99052882514569 7y ago
>Are you sure it's "an unfair advantage" and not just "an advantage"? Doesn't your position presume that the brick-and-mortar business model deserves special protection? If so, why? Because it employs more people and pays taxes locally. It's perfectly valid for the government to ignore that and focus solely on the consumer side (i.e. minimize prices), but it's also perfectly valid (and economically sound) to do what France is doing. >What is the implied incentive in this case? It seems like it's just incentivizing a brick and mortar business model No, it is not incentivizing it. It levels the playing field a bit by applying more consistent taxation. >Doesn't this all point to a fundamental problem with "corporate tax"? Wouldn't it be better (fairer) to reduce or remove corporate tax and raise sales tax or similar, such that it doesn't matter whether the business has a presence in the country in question? I can be persuaded by that argument (economists do love consumption taxes for a reason, after all), but either way it's not for Amazon to decide. In France, it is for the French people to decide, via their representatives. Whatever positive or negative consequences arise are also theirs to bear.
- da_chicken 7y ago
  > > Doesn't this all point to a fundamental problem with "corporate tax"? Wouldn't it be better (fairer) to reduce or remove corporate tax and raise sales tax or similar, such that it doesn't matter whether the business has a presence in the country in question? Well, now you run into the problem of progressive vs regressive taxation. Since consumption taxes, as the name implies, tax consumption, and the poor have a marginal propensity to consume of almost 1.0 while the wealthy can have an extremely low marginal propensity to consume, it's reasonable to conclude that consumption taxes are taxing the people who are least able to pay and who would already be spending that money anyways. You're taking away money that would already have stimulated the economy elsewhere. Taxing the poor runs into these kind of zero-sum problems much more quickly. The rich tend to save or are more able to engage in activities which produce products of much more questionable economic value (i.e., bitcoin farms, copyright trolls, rent-seeking, etc.). Obviously investment has value, but in economic terms it may or may not generate a commensurate amount of wealth.