21 ms·

It would just be really good if companies stopped avoiding tax. Most countries are already pretty much bankrupt - it's worth thinking about for every debt (US N

It would just be really good if companies stopped avoiding tax. Most countries are already pretty much bankrupt - it's worth thinking about for every debt (US National Debt is $35.35 trillion!!) there is a rich person on the end of it with the loan as an asset earning interest. If companies avoid tax and rich people avoid tax it means more tax for normal people who work for a living.

Iulioh 2y ago
Its just the prisoner dilemma. If you don't your competition will. We just need more spine in the country's legislation to close ANY loophole, because this wasn't illegal tax evasion, it was legal tax ellusion. The point is that EU judged this unfair by Ireland and that effectively it stole revenue from other European counties to favor jobs in ireland. Basically saying "you (country) can't have a lower tax rate than X" in our economic union. Smaller countries with few industries would benefit disproportionately from bigger companies moving here the HQ.
- moomin 2y ago
  A good way of thinking about the EU is as a solution to the prisoner's dilemma.
  - dantheman 2y ago
    The EU is more of a problem than any sort of solution.
  - kamikazeturtles 2y ago
    Do they tax LVMH? Or fine it for monopolistic practices? The EU is a pretty one-sided solution to the prisoner's dilemma
    - gpderetta 2y ago
      > Do they tax LVMH? Any reasons to believe it isn't taxed? > Or fine it for monopolistic practices? Well, currently it is being investigated it seems: https://www.reuters.com/business/retail-consumer/french-police-working-with-eu-luxury-antitrust-probe-2023-04-21/ https://www.reuters.com/business/retail-consumer/french-poli...
    - nolok 2y ago
      And you can't bother doing a simple google search ? Their effective tax rate is about 27%, yes.
- jokethrowaway 2y ago
  That will never work because the powerful will lobby the politicians to add some new loophole. The only solution is to NOT have taxes, NOT have a government and then the market is fair for everyone. Unless you are into anarchy / voluntarism you won't like this solution, so keep enjoying your broken system with increasing inequality between the top 0.01% who colludes with the government and the rest - while the middle class gets their money stolen to pay for both rich and poor.
  - kwhitefoot 2y ago
    Not having a government is the same as handing you society over to robber barons. Your solution would end with the reintroduction of feudalism as the only way that the rich and powerful can hold on to their wealth without it being plundered by the rich guy next door. Markets can only be fair if everyone in the market has the same degree of financial power. This can never happen in large scale anarchies. The only chance of it happening is by having strong regulation.
    - Iulioh 2y ago
      Given enough time Anarchy is just the State with extra steps and less rights.
dgrin91 2y ago
This is a very naive way of thinking about debt. Cash has a time value. Cash now is worth more than cash later. I have a mortgage. This mortgage is worth more than the cash I own. That doesn't mean I'm bankrupt. The mortgage is paid on a fixed schedule over 30 years, and during those 30 years I'll have a home and be able to accrue other assets. If I didn't get a mortgage then I would still be saving for my home. The same is true with the US balance sheet. It has accrued 35T in debt, but it's used that to fund it's operations. Those operations generate more for the US. As long as the US has enough to pay it's obligations over the next few decades there are no issues That of course doesn't change the fact that tax loopholes can be problematic
- sweezyjeezy 2y ago
  I think it's rarely valid to compare countries' economics to your own personal finance, macroeconomics are a lot more complicated. Example: for employed people, going into (or avoiding) debt generally won't affect their yearly wages, but analogously it can for countries (e.g. well spent debt can stimulate economic growth).
  - b112 2y ago
    The downside of state debt is the downward spiral. If you spend 1/2 your tax income on just servicing the debt, that means either fewer services for people, or borrowing yet more, just to keep things going. If you borrow more, then it gets even worse. I really prefer that 1/2 my tax bill doesn't go to interest payments.
    - woah 2y ago
      Let's say a city builds a bridge that doubles its tax income by opening up a lot of economic opportunities. It pays for this with a 35 year bond. During these 35 years, the entire additional income that the bridge generated goes towards paying off the bond. After the 35 years the bond is paid off and the city enjoys permanently raised tax income (not to mention better economy for residents). Was there a problem that the city spent 1/2 of tax income on just servicing the debt?
yieldcrv 2y ago
Whaaaaat? A) These bankrupt countries are exactly why we should think twice about funding their spending habit, with reevaluation only when they address their spending habit B) These companies are tax compliant, barring when the ECJ rules against them C) if what you meant was equivalent taxation - no amount of taxation of profits or income would fill these bankrupt countries budget holes D) the countries tell you exactly how not to pay tax, they incentivize certain transactions and tax the remainder of funds that weren't involved. (The ECJ overruled an entire country, with retroactive logic)
simonh 2y ago
>there is a rich person on the end of it with the loan as an asset earning interest. About half of treasuries are held by the Fed or foreign investors which largely means other governments and foreign companies. Most of the rest are owned by pension funds, banks, local government, insurance companies, etc.
- tivert 2y ago
  >> there is a rich person on the end of it with the loan as an asset earning interest. > About half of treasuries are held by the Fed or foreign investors which largely means other governments and foreign companies. Most of the rest are owned by pension funds, banks, local government, insurance companies, etc. So what? That doesn't mean you shouldn't think about it in terms of a rich person, like the GP suggests. The modern capitalist system is a very slippery thing to think about, and there are all kinds of traps to mislead people. For instance, facts like the one you point out can draw people away from understanding the truth behind scenarios where the rich are the group that greatly disproportionally benefits while not being the group that benefits the most in absolute terms. On a related note: IMHO the 401k is one of the greatest propaganda coups in the history of democracy. You have vast swaths of the public owning tiny, insignificant slivers of the overall pie; while the rich own big, disproportionate slices. But then the public votes to increase those tiny, tangible slivers by trading much more valuable but less tangible things.
  - the_optimist 2y ago
    There is no such slippery-ness or slippage. The system is fundamentally assessable with basic accounting and Econ 101. No, the 401k is not a coup. No, class-warfare advocates cannot fundamentally create value, improve the economy, or the better state of individual well-being—-either temporarily or permanently—-by wealth transfer, and their efforts typically result in gross infringement of human rights. Typically in history these wealth transfers have greatest negative impact against the middle- and lower- tiers of wealth. The study of the encomiendas in Columbia is perhaps somewhat insightful.
    - 2y ago
Aerroon 2y ago
Maybe governments need to stop spending 40-50% of the entire GDP? For example, the US federal government + state governments spend about $10 trillion a year. The US has a GDP of about $25 trillion. And the US isn't exactly known as a high tax country. France is estimated to be at 58%...
- kasperni 2y ago
  Universal healthcare and welfare systems aren’t free.
  - Aerroon 2y ago
    The welfare systems (in Europe at least) don't work. They work if you're old right now, but once the young people of today become old they won't get anything meaningful out of it. At least that's the impression I have and everyone else my age has. And healthcare is unavailable anyway. Several month long waits to see a specialist.
    - kwhitefoot 2y ago
      So how come the US has worse health outcomes?
      - Aerroon 2y ago
        I'm not sure. I don't think anyone knows for sure, but obesity probably heavily factors into it. 53% of Europeans are overweight or obese. The same figure in the US is 72%. That's a 36% difference. More than that, 17% of Europeans are obese (BMI >30) compared to the US's 42%. The fact that the US has a life expectancy of 79.1 compared to the EU's 81.5 years with that kind of difference in obesity levels is actually surprising. You would expect it to be lower than that in the US.
        qwytw 2y ago
        > compared to the EU's 81.5 years with that kind of difference in obesity levels is actually surprising It's probably considerable higher in EU15 i.e. if we exclude all the poor (currently or previously) ex-socialist Central and Eastern European countries that have a lot of baggage Or at least men in those countries: https://ec.europa.eu/eurostat/statistics-explained/images/2/2d/Gender-gap-life-expectancy-at-birth-2022V1.jpg https://ec.europa.eu/eurostat/statistics-explained/images/2/...
darkstar_16 2y ago
That's not even the same thing. The govt is bankrupt because it keeps printing money to get out of previous debt and other poor choices. The companies are following the rules and taking advantage of loopholes in the system.
- andy_ppp 2y ago
  It keeps printing money because we have socialism for the rich, they are never allowed to lose now.
dantheman 2y ago
It's not a funding problem, it's a spending problem. Taxes are insanely high around the world.
- immibis 2y ago
  Only for poor individuals like you and me. Taxes for rich people and companies are insanely low around the world.
arez 2y ago
Countries aren't bankrupt, they can't really go bankrupt if they use their own currency. Countries are not businesses they don't need to make money to be able to spend. Tax shouldn't be seen as the countries income but as a tool for redistribution of wealth and to keep trust in the currency as a whole. If you don't have debt you don't have money, every printed dollar goes into the system and can be used in various things not only an asset earning interest
superkuh 2y ago
Taxes don't fund government programs. Taxes are a way to mitigate the buying power of private capital when it comes to bidding against government for things. Governments just create money supply for programs. It's not tax money. That's just an old cliche.
- BadHumans 2y ago
  Need a citation or some reading for this because it sounds like something you believe without cause.
  - superkuh 2y ago
    It's literally in the 2nd paragraph of the wikipedia article. It's not a controversial statement. https://en.wikipedia.org/wiki/Government_spending https://en.wikipedia.org/wiki/Government_spending >Spending by a government that issues its own currency is nominally self-financing. *However, under a full employment assumption, to acquire resources produced by its population without potential inflationary pressures, removal of purchasing power must occur via government borrowing, taxes, custom duties, the sale or lease of natural resources, and various fees like national park entry fees or licensing fees. When these sovereign governments choose to temporarily remove spent money by issuing securities in its place, they pay interest on the money borrowed.* Changes in government spending are a major component of fiscal policy used to stabilize the macroeconomic business cycle.
  - pests 2y ago
    Not saying this was his intent, but this is part of Modern Monetary Theory (MMT) which says governments print money to provide services, and collect taxes as a matter of policy to legitimatize the currency, and for inflation and unemployment controls.
EasyMark 2y ago
While there is lots of tax fraud, I feel it’s probably a drop in the bucket. Countries will have to either cut back on spending or borrow until they collapse under the weight of their own inept budgeting.
pessimizer 2y ago
> It would just be really good if companies stopped avoiding tax. It would be great if everybody just stopped committing crimes, or being rude even when legal, altogether. But what are our alternatives other than just waiting for everyone to just do this? Also, how will everyone know how to just contact me to just find out when using the law to avoid taxes when you can is just evil, when it's just the smart thing to do, or when avoiding a tax is just justice, hard-fought and well-deserved? It would also be just great if it were autumn all year, and if alcohol and sugar were just good for you.
- geodel 2y ago
  Agree. I'd also like tobacco free / alcohol free zones to actually mean they are made available free of cost to visitors.
paulddraper 2y ago
> It would just be really good if companies stopped avoiding tax. You first :/
globular-toast 2y ago
I think this is a cultural problem. Every accountant everywhere works under the implicit assumption that taxes are to be avoided. Imagine if having a large tax contribution was something to be proud of. Perhaps the government needs to advertise more what the money actually gets spent on. Government works on boring stuff like the culverts that are essential to stopping roads flooding. People have no idea of the work that goes into this and just assume roads don't flood. It's like that old thing where you think everyone's job is pointless/easy except your own.
fransje26 2y ago
> If companies avoid tax and rich people avoid tax it means more tax for normal people who work for a living. Which is exactly what is happening, with the gap between rich and poor increasing in the western economies.
cainxinth 2y ago
Companies and high net worth individuals will never stop avoiding taxes, and it’s naive to assume otherwise. If anything, tax laws need to account for this reality more aggressively.

Iulioh 2y ago

Its just the prisoner dilemma. If you don't your competition will. We just need more spine in the country's legislation to close ANY loophole, because this wasn't illegal tax evasion, it was legal tax ellusion. The point is that EU judged this unfair by Ireland and that effectively it stole revenue from other European counties to favor jobs in ireland. Basically saying "you (country) can't have a lower tax rate than X" in our economic union. Smaller countries with few industries would benefit disproportionately from bigger companies moving here the HQ.

moomin 2y ago
A good way of thinking about the EU is as a solution to the prisoner's dilemma.
- dantheman 2y ago
  The EU is more of a problem than any sort of solution.
- kamikazeturtles 2y ago
  Do they tax LVMH? Or fine it for monopolistic practices? The EU is a pretty one-sided solution to the prisoner's dilemma
  - gpderetta 2y ago
    > Do they tax LVMH? Any reasons to believe it isn't taxed? > Or fine it for monopolistic practices? Well, currently it is being investigated it seems: https://www.reuters.com/business/retail-consumer/french-police-working-with-eu-luxury-antitrust-probe-2023-04-21/ https://www.reuters.com/business/retail-consumer/french-poli...
  - nolok 2y ago
    And you can't bother doing a simple google search ? Their effective tax rate is about 27%, yes.
jokethrowaway 2y ago
That will never work because the powerful will lobby the politicians to add some new loophole. The only solution is to NOT have taxes, NOT have a government and then the market is fair for everyone. Unless you are into anarchy / voluntarism you won't like this solution, so keep enjoying your broken system with increasing inequality between the top 0.01% who colludes with the government and the rest - while the middle class gets their money stolen to pay for both rich and poor.
- kwhitefoot 2y ago
  Not having a government is the same as handing you society over to robber barons. Your solution would end with the reintroduction of feudalism as the only way that the rich and powerful can hold on to their wealth without it being plundered by the rich guy next door. Markets can only be fair if everyone in the market has the same degree of financial power. This can never happen in large scale anarchies. The only chance of it happening is by having strong regulation.
  - Iulioh 2y ago
    Given enough time Anarchy is just the State with extra steps and less rights.

dgrin91 2y ago

This is a very naive way of thinking about debt. Cash has a time value. Cash now is worth more than cash later. I have a mortgage. This mortgage is worth more than the cash I own. That doesn't mean I'm bankrupt. The mortgage is paid on a fixed schedule over 30 years, and during those 30 years I'll have a home and be able to accrue other assets. If I didn't get a mortgage then I would still be saving for my home. The same is true with the US balance sheet. It has accrued 35T in debt, but it's used that to fund it's operations. Those operations generate more for the US. As long as the US has enough to pay it's obligations over the next few decades there are no issues That of course doesn't change the fact that tax loopholes can be problematic

sweezyjeezy 2y ago
I think it's rarely valid to compare countries' economics to your own personal finance, macroeconomics are a lot more complicated. Example: for employed people, going into (or avoiding) debt generally won't affect their yearly wages, but analogously it can for countries (e.g. well spent debt can stimulate economic growth).
- b112 2y ago
  The downside of state debt is the downward spiral. If you spend 1/2 your tax income on just servicing the debt, that means either fewer services for people, or borrowing yet more, just to keep things going. If you borrow more, then it gets even worse. I really prefer that 1/2 my tax bill doesn't go to interest payments.
  - woah 2y ago
    Let's say a city builds a bridge that doubles its tax income by opening up a lot of economic opportunities. It pays for this with a 35 year bond. During these 35 years, the entire additional income that the bridge generated goes towards paying off the bond. After the 35 years the bond is paid off and the city enjoys permanently raised tax income (not to mention better economy for residents). Was there a problem that the city spent 1/2 of tax income on just servicing the debt?

yieldcrv 2y ago

Whaaaaat? A) These bankrupt countries are exactly why we should think twice about funding their spending habit, with reevaluation only when they address their spending habit B) These companies are tax compliant, barring when the ECJ rules against them C) if what you meant was equivalent taxation - no amount of taxation of profits or income would fill these bankrupt countries budget holes D) the countries tell you exactly how not to pay tax, they incentivize certain transactions and tax the remainder of funds that weren't involved. (The ECJ overruled an entire country, with retroactive logic)

simonh 2y ago

>there is a rich person on the end of it with the loan as an asset earning interest. About half of treasuries are held by the Fed or foreign investors which largely means other governments and foreign companies. Most of the rest are owned by pension funds, banks, local government, insurance companies, etc.

tivert 2y ago
>> there is a rich person on the end of it with the loan as an asset earning interest. > About half of treasuries are held by the Fed or foreign investors which largely means other governments and foreign companies. Most of the rest are owned by pension funds, banks, local government, insurance companies, etc. So what? That doesn't mean you shouldn't think about it in terms of a rich person, like the GP suggests. The modern capitalist system is a very slippery thing to think about, and there are all kinds of traps to mislead people. For instance, facts like the one you point out can draw people away from understanding the truth behind scenarios where the rich are the group that greatly disproportionally benefits while not being the group that benefits the most in absolute terms. On a related note: IMHO the 401k is one of the greatest propaganda coups in the history of democracy. You have vast swaths of the public owning tiny, insignificant slivers of the overall pie; while the rich own big, disproportionate slices. But then the public votes to increase those tiny, tangible slivers by trading much more valuable but less tangible things.
- the_optimist 2y ago
  There is no such slippery-ness or slippage. The system is fundamentally assessable with basic accounting and Econ 101. No, the 401k is not a coup. No, class-warfare advocates cannot fundamentally create value, improve the economy, or the better state of individual well-being—-either temporarily or permanently—-by wealth transfer, and their efforts typically result in gross infringement of human rights. Typically in history these wealth transfers have greatest negative impact against the middle- and lower- tiers of wealth. The study of the encomiendas in Columbia is perhaps somewhat insightful.
  - 2y ago

Aerroon 2y ago

Maybe governments need to stop spending 40-50% of the entire GDP? For example, the US federal government + state governments spend about $10 trillion a year. The US has a GDP of about $25 trillion. And the US isn't exactly known as a high tax country. France is estimated to be at 58%...

kasperni 2y ago
Universal healthcare and welfare systems aren’t free.
- Aerroon 2y ago
  The welfare systems (in Europe at least) don't work. They work if you're old right now, but once the young people of today become old they won't get anything meaningful out of it. At least that's the impression I have and everyone else my age has. And healthcare is unavailable anyway. Several month long waits to see a specialist.
  - kwhitefoot 2y ago
    So how come the US has worse health outcomes?
    - Aerroon 2y ago
      I'm not sure. I don't think anyone knows for sure, but obesity probably heavily factors into it. 53% of Europeans are overweight or obese. The same figure in the US is 72%. That's a 36% difference. More than that, 17% of Europeans are obese (BMI >30) compared to the US's 42%. The fact that the US has a life expectancy of 79.1 compared to the EU's 81.5 years with that kind of difference in obesity levels is actually surprising. You would expect it to be lower than that in the US.
      - qwytw 2y ago
        > compared to the EU's 81.5 years with that kind of difference in obesity levels is actually surprising It's probably considerable higher in EU15 i.e. if we exclude all the poor (currently or previously) ex-socialist Central and Eastern European countries that have a lot of baggage Or at least men in those countries: https://ec.europa.eu/eurostat/statistics-explained/images/2/2d/Gender-gap-life-expectancy-at-birth-2022V1.jpg https://ec.europa.eu/eurostat/statistics-explained/images/2/...

darkstar_16 2y ago

That's not even the same thing. The govt is bankrupt because it keeps printing money to get out of previous debt and other poor choices. The companies are following the rules and taking advantage of loopholes in the system.

andy_ppp 2y ago
It keeps printing money because we have socialism for the rich, they are never allowed to lose now.

dantheman 2y ago

It's not a funding problem, it's a spending problem. Taxes are insanely high around the world.

immibis 2y ago
Only for poor individuals like you and me. Taxes for rich people and companies are insanely low around the world.

arez 2y ago

Countries aren't bankrupt, they can't really go bankrupt if they use their own currency. Countries are not businesses they don't need to make money to be able to spend. Tax shouldn't be seen as the countries income but as a tool for redistribution of wealth and to keep trust in the currency as a whole. If you don't have debt you don't have money, every printed dollar goes into the system and can be used in various things not only an asset earning interest

superkuh 2y ago

Taxes don't fund government programs. Taxes are a way to mitigate the buying power of private capital when it comes to bidding against government for things. Governments just create money supply for programs. It's not tax money. That's just an old cliche.

BadHumans 2y ago
Need a citation or some reading for this because it sounds like something you believe without cause.
- superkuh 2y ago
  It's literally in the 2nd paragraph of the wikipedia article. It's not a controversial statement. https://en.wikipedia.org/wiki/Government_spending https://en.wikipedia.org/wiki/Government_spending >Spending by a government that issues its own currency is nominally self-financing. *However, under a full employment assumption, to acquire resources produced by its population without potential inflationary pressures, removal of purchasing power must occur via government borrowing, taxes, custom duties, the sale or lease of natural resources, and various fees like national park entry fees or licensing fees. When these sovereign governments choose to temporarily remove spent money by issuing securities in its place, they pay interest on the money borrowed.* Changes in government spending are a major component of fiscal policy used to stabilize the macroeconomic business cycle.
- pests 2y ago
  Not saying this was his intent, but this is part of Modern Monetary Theory (MMT) which says governments print money to provide services, and collect taxes as a matter of policy to legitimatize the currency, and for inflation and unemployment controls.

EasyMark 2y ago

While there is lots of tax fraud, I feel it’s probably a drop in the bucket. Countries will have to either cut back on spending or borrow until they collapse under the weight of their own inept budgeting.

pessimizer 2y ago

> It would just be really good if companies stopped avoiding tax. It would be great if everybody just stopped committing crimes, or being rude even when legal, altogether. But what are our alternatives other than just waiting for everyone to just do this? Also, how will everyone know how to just contact me to just find out when using the law to avoid taxes when you can is just evil, when it's just the smart thing to do, or when avoiding a tax is just justice, hard-fought and well-deserved? It would also be just great if it were autumn all year, and if alcohol and sugar were just good for you.

geodel 2y ago
Agree. I'd also like tobacco free / alcohol free zones to actually mean they are made available free of cost to visitors.

paulddraper 2y ago

> It would just be really good if companies stopped avoiding tax. You first :/

globular-toast 2y ago

I think this is a cultural problem. Every accountant everywhere works under the implicit assumption that taxes are to be avoided. Imagine if having a large tax contribution was something to be proud of. Perhaps the government needs to advertise more what the money actually gets spent on. Government works on boring stuff like the culverts that are essential to stopping roads flooding. People have no idea of the work that goes into this and just assume roads don't flood. It's like that old thing where you think everyone's job is pointless/easy except your own.

fransje26 2y ago

> If companies avoid tax and rich people avoid tax it means more tax for normal people who work for a living. Which is exactly what is happening, with the gap between rich and poor increasing in the western economies.

cainxinth 2y ago

Companies and high net worth individuals will never stop avoiding taxes, and it’s naive to assume otherwise. If anything, tax laws need to account for this reality more aggressively.