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That american exceptionalism approach will work with private citizen customers. With business customers, leaning back in the legal framework encouraging tax fra

That american exceptionalism approach will work with private citizen customers. With business customers, leaning back in the legal framework encouraging tax fraud will not fly. They just won't buy from you then. That's why any US company wanting to do business in Europe either has an European subsidiary, or follows something that's compatible with EU invoicing schemes.

notch656a 4y ago
>. With business customers, leaning back in the legal framework encouraging tax fraud will not fly. Yes which is why in nations like Portugal, where any business invoice may be subject to accountability to government, there totally isn't a massive informal (read: tax-evading) economy to deal with the fact that the government makes it literally impossible (at least in above words) to accept an invoice legal in the jurisdiction in which it was issued.
- gamblor956 4y ago
  You keep bringing this up and it's simply not true. The EU has a single set of VAT invoice requirements that applies across the EU (the MOSS invoicing standard). Any VAT invoice that satisfies these rules is legal in all EU countries (https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32006L0112 https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32..., article 226). My company does plenty of business with EU businesses and we use a single standard EU VAT invoice without issue.
- orf 4y ago
  There isn’t a massive tax evasion economy in the USA?
  - notch656a 4y ago
    Yes. It would be even larger if US companies couldn't accept foreign invoices without being in a special format. Does tax evasion in the US somehow disprove tax evasion in Europe?
- PeterisP 4y ago
  It's not literally impossible - the simple solution to standard invoice being unacceptable is to issue a different invoice that matches the requirements, and almost every vendor is happy to do so in order to make the sale. Also, the informal tax-evading economy relies on personal contacts and 'mutual understanding' - it's not easily accessible to a foreign vendor, and when foreign vendors do want to access that economy, it requires much more adoption of local customs than just making a different format of invoice.
  - notch656a 4y ago
    Yes literally impossible to take something in a format legal in the US, that doesn't match the foreign requirements, based on European testimony above (the exact truth of which IDK). Informal tax-evading (when the seller isn't evading, just the buyer) doesn't require personal contacts. This is just naïve thoughtless statement. It happens all the time. Example: business owner goes to Panama where they know no one. Buys a pallet of llama wool, seller gives a non-conforming receipt. Buyer goes back to France, imports the pallet as "cotton" and creates a fake invoice showing the Panamanian sold cotton. Seller then sells llama wool on the streets for cash, marking in the books that they sold "cotton" for significantly less. They then use the on-the-books "cotton" proceeds to buy a shit-wagon car or something, and fix it using the unrecorded cash on the side. They sell the now nice shit-wagon and record the proceeds as profit. Now all the money for the llama wool is accounted for. Cross country tax-evading is only assured in this case to require personal contacts when the tax evading happens on _both_ sides. When it only happens on the EU side, there's no need for personal contacts on the US side.
    - DocTomoe 4y ago
      > Buys a pallet of llama wool, seller gives a non-conforming receipt. Buyer goes back to France, imports the pallet as "cotton" Customs catches him (distinguishing cotton from non-cotton is surprisingly easy, so is forged documents for invoicing and freight papers, especially given that Panama is an unusual country to export raw cotton - or raw wool - from), he is now in prison for 5 years for tax fraud and document forging, llama wool is confiscated and auctioned off to legitimate sellers.
- raverbashing 4y ago
  People are mixing up things here It's not illegal to pay an US company with an US invoice in the EU. (HN likes to invent problems where there aren't, and companies do that all the time). It is not even limited to the US, most other countries can't/won't follow the format. However there might be extra steps in adding those invoices to their accounting. For example, when import, the buyer will be charged the import tax (instead of having it added to the invoice) The informal economy of Portugal has nothing to do with the above btw since that has nothing to do with American invoices (and you can bet German rules are not much simpler) - not saying the bureaucracy isn't, most of the time, stupid. The US also has it fair share of stupid crap that people have to deal as well but it is "transparent" to most Americans.

notch656a 4y ago

>. With business customers, leaning back in the legal framework encouraging tax fraud will not fly. Yes which is why in nations like Portugal, where any business invoice may be subject to accountability to government, there totally isn't a massive informal (read: tax-evading) economy to deal with the fact that the government makes it literally impossible (at least in above words) to accept an invoice legal in the jurisdiction in which it was issued.

gamblor956 4y ago
You keep bringing this up and it's simply not true. The EU has a single set of VAT invoice requirements that applies across the EU (the MOSS invoicing standard). Any VAT invoice that satisfies these rules is legal in all EU countries (https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32006L0112 https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32..., article 226). My company does plenty of business with EU businesses and we use a single standard EU VAT invoice without issue.
orf 4y ago
There isn’t a massive tax evasion economy in the USA?
- notch656a 4y ago
  Yes. It would be even larger if US companies couldn't accept foreign invoices without being in a special format. Does tax evasion in the US somehow disprove tax evasion in Europe?
PeterisP 4y ago
It's not literally impossible - the simple solution to standard invoice being unacceptable is to issue a different invoice that matches the requirements, and almost every vendor is happy to do so in order to make the sale. Also, the informal tax-evading economy relies on personal contacts and 'mutual understanding' - it's not easily accessible to a foreign vendor, and when foreign vendors do want to access that economy, it requires much more adoption of local customs than just making a different format of invoice.
- notch656a 4y ago
  Yes literally impossible to take something in a format legal in the US, that doesn't match the foreign requirements, based on European testimony above (the exact truth of which IDK). Informal tax-evading (when the seller isn't evading, just the buyer) doesn't require personal contacts. This is just naïve thoughtless statement. It happens all the time. Example: business owner goes to Panama where they know no one. Buys a pallet of llama wool, seller gives a non-conforming receipt. Buyer goes back to France, imports the pallet as "cotton" and creates a fake invoice showing the Panamanian sold cotton. Seller then sells llama wool on the streets for cash, marking in the books that they sold "cotton" for significantly less. They then use the on-the-books "cotton" proceeds to buy a shit-wagon car or something, and fix it using the unrecorded cash on the side. They sell the now nice shit-wagon and record the proceeds as profit. Now all the money for the llama wool is accounted for. Cross country tax-evading is only assured in this case to require personal contacts when the tax evading happens on _both_ sides. When it only happens on the EU side, there's no need for personal contacts on the US side.
  - DocTomoe 4y ago
    > Buys a pallet of llama wool, seller gives a non-conforming receipt. Buyer goes back to France, imports the pallet as "cotton" Customs catches him (distinguishing cotton from non-cotton is surprisingly easy, so is forged documents for invoicing and freight papers, especially given that Panama is an unusual country to export raw cotton - or raw wool - from), he is now in prison for 5 years for tax fraud and document forging, llama wool is confiscated and auctioned off to legitimate sellers.
raverbashing 4y ago
People are mixing up things here It's not illegal to pay an US company with an US invoice in the EU. (HN likes to invent problems where there aren't, and companies do that all the time). It is not even limited to the US, most other countries can't/won't follow the format. However there might be extra steps in adding those invoices to their accounting. For example, when import, the buyer will be charged the import tax (instead of having it added to the invoice) The informal economy of Portugal has nothing to do with the above btw since that has nothing to do with American invoices (and you can bet German rules are not much simpler) - not saying the bureaucracy isn't, most of the time, stupid. The US also has it fair share of stupid crap that people have to deal as well but it is "transparent" to most Americans.