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> It used to be that the money spent on that advertisement went to a German advertisement company It sounds to me like the problem is that the German economy f
by alt_f4 7y ago
> It used to be that the money spent on that advertisement went to a German advertisement company
It sounds to me like the problem is that the German economy failed to produce a Google competitor or, at least, a decent local German online advertising network that the German consumer would want to use. So, now they have a problem that they're trying to solve with taxation instead of innovation. This won't work, it just creates barriers to international trade in global world. It is 19th century economics.
> have over local companies by not needing to pay taxes at all
That is incorrect. They pay their taxes in their home countries. Why should they be penalized extra over local to Germany companies by having to pay double tax: once at home and once in that country?
- m12k 7y agoYou don't seem to understand how transfer pricing and tax havens work. These companies are not paying taxes on profits from most of their foreign sales in their home countries - the home corporation pays taxes on their domestic profits, and profits from those international subsidiaries that can't be channeled to tax havens (e.g. not from Europe) while all those profits that can make their way to tax havens do. Here's an article explaining how Apple does it: https://www.irishtimes.com/business/apple-s-cash-mountain-how-it-avoids-tax-and-the-irish-link-1.3281734 https://www.irishtimes.com/business/apple-s-cash-mountain-ho...
- tonfa 7y agoWhat that article doesn't make it clear is that the overseas cash was still subject to US taxation. A few years ago, that taxation could be indefinitely deferred, but that's no longer the case. So calling it a tax haven is somewhat misleading if we're talking about US companies.