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Is this a shadow trade war in response to America’s dominance in tech? I keep seeing absolutely massive fines of American tech companies in Europe, fines marked

by jquery 7y ago

Is this a shadow trade war in response to America’s dominance in tech? I keep seeing absolutely massive fines of American tech companies in Europe, fines marked up to account for Google’s global revenues. Do they make their homegrown companies pay such outrageous fines? $1B is a staggering amount of money, probably all of Google’s profits from France for years to come. To be clear I think France has every right to do this and Google can decide to close up shop there if they want, nobody is forcing Google to operate in an unfriendly environment.

quentindemetz 7y ago
Corporate tax in France was (until recently) 33%. The government was seeking 1.6B which means it’s estimation of Google’s profit for the years in question was closer to 5B. Hopefully this kind of fine will void the tax shenanigans Google uses to offshore their profits to Ireland as well as its reduced tax rate there. Make money in France, pay taxes there. Doesn’t seem like to much to ask.
anacoluthe 7y ago
Maybe it is a response to a more global situation. Please look into corruption charges and fines of US Justice on European companies such as Alcatel, Société Générale, Alstom and you'll that these fines are quite a good instrument to weaken strategic European competitors (and the opposite is true as well) and even take them over. Example: https://www.economist.com/business/2019/01/17/how-the-american-takeover-of-a-french-national-champion-became-intertwined-in-a-corruption-investigation https://www.economist.com/business/2019/01/17/how-the-americ...
- jquery 7y ago
  Very interesting, looks the fines are tit for tat from a game theoretic perspective. It seems the headlines are dominated by fines of American enterprises but that doesn’t paint a full picture.
la_barba 7y ago
>I keep seeing absolutely massive fines of American tech companies in Europe, fines marked up to account for Google’s global revenues. Maybe EU companies don't dodge taxes as much as US companies? Maybe there is a larger concentration of wealth in US corporate entities? Lots of sane reasons, no need to rush to wild conspiracy theories... >To be clear I think France has every right to do this and Google can decide to close up shop there if they want, nobody is forcing Google to operate in an unfriendly environment. Well, nobody is forcing Google to dodge taxes either...

by jquery 7y ago

quentindemetz 7y ago

Corporate tax in France was (until recently) 33%. The government was seeking 1.6B which means it’s estimation of Google’s profit for the years in question was closer to 5B. Hopefully this kind of fine will void the tax shenanigans Google uses to offshore their profits to Ireland as well as its reduced tax rate there. Make money in France, pay taxes there. Doesn’t seem like to much to ask.

anacoluthe 7y ago

Maybe it is a response to a more global situation. Please look into corruption charges and fines of US Justice on European companies such as Alcatel, Société Générale, Alstom and you'll that these fines are quite a good instrument to weaken strategic European competitors (and the opposite is true as well) and even take them over. Example: https://www.economist.com/business/2019/01/17/how-the-american-takeover-of-a-french-national-champion-became-intertwined-in-a-corruption-investigation https://www.economist.com/business/2019/01/17/how-the-americ...

jquery 7y ago
Very interesting, looks the fines are tit for tat from a game theoretic perspective. It seems the headlines are dominated by fines of American enterprises but that doesn’t paint a full picture.

la_barba 7y ago

>I keep seeing absolutely massive fines of American tech companies in Europe, fines marked up to account for Google’s global revenues. Maybe EU companies don't dodge taxes as much as US companies? Maybe there is a larger concentration of wealth in US corporate entities? Lots of sane reasons, no need to rush to wild conspiracy theories... >To be clear I think France has every right to do this and Google can decide to close up shop there if they want, nobody is forcing Google to operate in an unfriendly environment. Well, nobody is forcing Google to dodge taxes either...