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Why should governments forgo tax revenue now to create companies like Amazon that pay zero taxes later? It makes no sense.

by mnm1 7y ago

trevyn 7y ago
Because then you create companies like Amazon.
- sschueller 7y ago
  I rather not have Amazon and still have my local book store.
  - harryh 7y ago
    I can't comment on Switzerland, but in the US local bookstores are thriving: "Between 2009 and 2015, the number of independent bookstores grew by 35 percent." https://www.npr.org/2018/03/29/598053563/why-the-number-of-independent-bookstores-increased-during-the-retail-apocalypse https://www.npr.org/2018/03/29/598053563/why-the-number-of-i...
- untog 7y ago
  You create companies that evade tax and pay workers as little as possible? Remind me why that is desirable again? People act as if it's an either/or: if you make companies pay tax, Amazon will never exist. But if the market is there there's no reason someone wouldn't set up a company similar to Amazon that also happens to pay tax and maybe even give employees bathroom breaks.
  - adrianN 7y ago
    Every company pays workers as little as possible. It's up to the government to make "as little as possible" a fair wage.
  - wickedsickeune 7y ago
    Absolutely with you, just one correction: if this someone has no incentive to not avoid taxes and exploit workers, he won't do it, or will be replaced by someone who does (as he would have an advantage). I'm not saying there should be regulations, but there should be regulations.
wickedsickeune 7y ago
The fact that they pay zero taxes is unrelated to their creation.
TomMarius 7y ago
Tax revenue is not the only metric. If I am to live on a world where it is the primary metric, I would rather move to Mars.
- Ensorceled 7y ago
  I kind of feel the same way about "creating wealth", mostly because all the created wealth goes to a few founders and their VCs. Who all seem to be moving to New Zealand or Mars ...
bartread 7y ago
They don't pay zero taxes. They pay zero taxes (or close to) in some countries. Understandably those countries aren't happy[1]. However, I can assure you that if you start a company in the UK that turns a profit, you will pay corporation tax at a rate substantially above 0%. [1] Worth pointing out that this isn't the only way governments earn tax money from companies. The less direct route is through salaries. Amazon makes sales and, out of the money it earns, pays staff, these staff in turn pay income tax, which increases the tax take of the country in which they live. For tech companies with higher earning staff (granted Amazon may not be a great example because they have plenty of staff in lower-paying roles, e.g., in warehousing), in the UK those staff are likely to pay higher rate tax. I'm not saying this makes it OK for Amazon to pay no corporation tax: what I'm saying is that the tax benefit to a country flows via multiple streams. At the moment it seems like somebody has dammed one of those streams, but the point still stands.
- NeedMoreTea 7y ago
  Until you become big enough to trade and play countries off against each other. Multinationals have, for the most part, been placed above the nation and government. They get to pick and choose.
- wickedsickeune 7y ago
  Amazon does not pay taxes from salaries. The employees pay taxes from salaries. Amazon, if you moved to Mars, shouldn't reduce your salary because you're not paying tax to the UK.
  - leetcrew 7y ago
    > Amazon does not pay taxes from salaries. for the one millionth time, it doesn't actually matter whether you pay income tax or your employer pays it for you. [0] if you want to be precise, amazon doesn't pay income tax, but it does have to pay payroll taxes for each employee, which is proportional to the income they are paid. > Amazon, if you moved to Mars, shouldn't reduce your salary because you're not paying tax to the UK. amazon changes payscales based on local COL at all if it's offices. if enough employees lived in a zero income tax environment to matter, amazon (or any other large company) would absolutely shift salaries down. [0] https://en.wikipedia.org/wiki/Tax_incidence https://en.wikipedia.org/wiki/Tax_incidence

Why should governments forgo tax revenue now to create companies like Amazon that pay zero taxes later? It makes no sense.

by mnm1 7y ago

Why should governments forgo tax revenue now to create companies like Amazon that pay zero taxes later? It makes no sense.

trevyn 7y ago

Because then you create companies like Amazon.

sschueller 7y ago
I rather not have Amazon and still have my local book store.
- harryh 7y ago
  I can't comment on Switzerland, but in the US local bookstores are thriving: "Between 2009 and 2015, the number of independent bookstores grew by 35 percent." https://www.npr.org/2018/03/29/598053563/why-the-number-of-independent-bookstores-increased-during-the-retail-apocalypse https://www.npr.org/2018/03/29/598053563/why-the-number-of-i...
untog 7y ago
You create companies that evade tax and pay workers as little as possible? Remind me why that is desirable again? People act as if it's an either/or: if you make companies pay tax, Amazon will never exist. But if the market is there there's no reason someone wouldn't set up a company similar to Amazon that also happens to pay tax and maybe even give employees bathroom breaks.
- adrianN 7y ago
  Every company pays workers as little as possible. It's up to the government to make "as little as possible" a fair wage.
- wickedsickeune 7y ago
  Absolutely with you, just one correction: if this someone has no incentive to not avoid taxes and exploit workers, he won't do it, or will be replaced by someone who does (as he would have an advantage). I'm not saying there should be regulations, but there should be regulations.

wickedsickeune 7y ago

The fact that they pay zero taxes is unrelated to their creation.

TomMarius 7y ago

Tax revenue is not the only metric. If I am to live on a world where it is the primary metric, I would rather move to Mars.

Ensorceled 7y ago
I kind of feel the same way about "creating wealth", mostly because all the created wealth goes to a few founders and their VCs. Who all seem to be moving to New Zealand or Mars ...

bartread 7y ago

They don't pay zero taxes. They pay zero taxes (or close to) in some countries. Understandably those countries aren't happy[1]. However, I can assure you that if you start a company in the UK that turns a profit, you will pay corporation tax at a rate substantially above 0%. [1] Worth pointing out that this isn't the only way governments earn tax money from companies. The less direct route is through salaries. Amazon makes sales and, out of the money it earns, pays staff, these staff in turn pay income tax, which increases the tax take of the country in which they live. For tech companies with higher earning staff (granted Amazon may not be a great example because they have plenty of staff in lower-paying roles, e.g., in warehousing), in the UK those staff are likely to pay higher rate tax. I'm not saying this makes it OK for Amazon to pay no corporation tax: what I'm saying is that the tax benefit to a country flows via multiple streams. At the moment it seems like somebody has dammed one of those streams, but the point still stands.

NeedMoreTea 7y ago
Until you become big enough to trade and play countries off against each other. Multinationals have, for the most part, been placed above the nation and government. They get to pick and choose.
wickedsickeune 7y ago
Amazon does not pay taxes from salaries. The employees pay taxes from salaries. Amazon, if you moved to Mars, shouldn't reduce your salary because you're not paying tax to the UK.
- leetcrew 7y ago
  > Amazon does not pay taxes from salaries. for the one millionth time, it doesn't actually matter whether you pay income tax or your employer pays it for you. [0] if you want to be precise, amazon doesn't pay income tax, but it does have to pay payroll taxes for each employee, which is proportional to the income they are paid. > Amazon, if you moved to Mars, shouldn't reduce your salary because you're not paying tax to the UK. amazon changes payscales based on local COL at all if it's offices. if enough employees lived in a zero income tax environment to matter, amazon (or any other large company) would absolutely shift salaries down. [0] https://en.wikipedia.org/wiki/Tax_incidence https://en.wikipedia.org/wiki/Tax_incidence