4 ms·

This is a retcon attempt. While sure, tariffs are just a tax like any other and can be applied to lots of different policy aims, and don't have to be the end o

by ajross 1y ago

This is a retcon attempt. While sure, tariffs are just a tax like any other and can be applied to lots of different policy aims, and don't have to be the end of the world... None of these arguments were presented in a reasonable way, with numbers, ahead of a policy decision that made a considered attempt to find an optimal balance. No, we elected an administration that had been shouting "Tariffs!" during the campaign, then enacted "Tariffs!" once in office, then engaged in a quite frankly pathetic flurry of increases/decreases/suspensions/delays to try to fix the critical problems being introduced by the "Tariffs!". Most of which have been to other nations' benefit, even. It's a bit much to look back after three months of this madness and try to pretend how reasonable it was all along. We're still in the madness (Q2/Q3 numbers haven't landed yet to show actual effects, it's going to be a rocky year, folks).

matwood 1y ago
The administration still routinely presents VAT as a tariff. To think there is any real policy thought behind the actions is akin to looking for meaning in the clouds.
- nkozyra 1y ago
  "Clouds are simply a negotiating tactic"
- trelane 1y ago
  To some extent, they seem interchangeable. For instance, any time System76 is brought up for Europeans, VAT is immediately mentioned, along with why they don't have a European distribution center. Why would opening a European distribution center be relevant if you have to pay the same VAT either way? A few examples: https://ubuntuforums.org/showthread.php?t=2204089 https://ubuntuforums.org/showthread.php?t=2204089 https://www.reddit.com/r/System76/comments/1c9djrj/taxes_on_shipping_to_europe/ https://www.reddit.com/r/System76/comments/1c9djrj/taxes_on_...
  - matwood 1y ago
    The VAT is akin to a sales tax. It's paid regardless of where the item is manufactured or distributed from (and mostly regardless of the item). The US typically applies between 5-10% sales tax on most items. I have no idea why someone from System76 would think it's relevant to have an EU distribution center, but it wouldn't change the VAT. BTW, it's not just the EU that wants you to pay the sales tax when bringing items across the border, but the US also. It just so happens that it's rarely if ever enforced. EDIT I should add that the key difference of the VAT and tariff is that VAT is not made to advantage one product over another. It's simply a sales tax on nearly all products, just like the US sales taxes.
    - trelane 1y ago
      > have no idea why someone from System76 would think it's relevant to have an EU distribution center, but it wouldn't change the VAT. It seems to be the customers asking for one, not System76. They were planning to open one, though. > VAT is not made to advantage one product over another. Like sales tax, there are different (and often zero) rates depending on product (same link as before)
      - tzs 1y ago
        >> VAT is not made to advantage one product over another. > Like sales tax, there are different (and often zero) rates depending on product (same link as before) But those different rates depend on the product category, not the product manufacturer or place of origin. The whole point of tariffs is to base rates on place of origin.
        trelane 1y ago
        > But those different rates depend on the product category, not the product manufacturer or place of origin. They do, though: https://stripe.com/en-ch/resources/more/import-tax-germany https://stripe.com/en-ch/resources/more/import-tax-germany
        1y ago
- ajross 1y ago
  Well, I mean, sorta? This is the point where, indeed, rational discussion can happen. In the real world, VATs and tariffs are both taxes collected at the point of trade. The distinction is just about what boundary constitutes a "trade" and what accounting is done to determine the "value" of the trade. But they're close cousins and do most of the same thing and can be used for most of the same policy purposes. But again, that's not what's happening in US policymaking right now. They don't want tariffs, they want "Tarrifs!", and splitting hairs over the precise definition isn't going to change their mind.
  - pineaux 1y ago
    No this is incorrect. The VAT is paid by all the steps in the line and reclaimed until it hits the final seller. That seller collects the VAT and pays it to the taxman. If you import something into a European country, you pay VAT but the VAT is reclaimable basically immediately. Many European countries allow you to postpone the payment of vat as long as you are VAT-registered in that country. You can then declare it to your VAT tax return and basically deducted in the same return. So although the vat might give some cashflow problems, you cannot put it in the same ballpark as a tariff or import tax.
    - ajross 1y ago
      FWIW, I don't see how any of that rebuts the idea that VATs and tariffs are both taxes collected at the point of trade and that they can be used for basically all of the same policy purposes (which, as we all know, is not limited to revenue generation). Yes yes yes, complex rules are complicated. So what? You can do things with a VAT that you can with a tariff, and that you can not with an income tax or estate tax or usage fee or whatever. They are closely related policy instruments.
smitty1e 1y ago
> None of these arguments were presented in a reasonable way, with numbers, ahead of a policy decision that made a considered attempt to find an optimal balance. TFA is the transcript of an historical overview lecture, not a formal economic thesis on the topic, much less, a journal article. Your point, while valid, might be enhanced by some counter-linking.
- watwut 1y ago
  > President Trump wants to level this playing field. No. It is an attempt to sanewash conservatives, because that is the whole reason for being for this university. The part about Germany and cars is also crap.
  - smitty1e 1y ago
    > The part about Germany and cars is also crap. So, could you suggest a link to a solid refutation?
    - orwin 1y ago
      Anybody who understands what VAT is and how it works cannot take this part of the article seriously. I hate VAT, I think it should cease to exist (it is still marginally better than sale taxes) but I made the effort to actually try to understand how it works before writing bullshit about it on basically a blog post.
      - watwut 1y ago
        The article is lying. At this point, it is not reasonable to assume this is just not understanding things. People who work in these institutions lie, they are paid for lying and they do it to project their ideological agenda.
        smitty1e 1y ago
        > The article is lying. A legless assertion. Could you be more specific with the objection, please?

by ajross 1y ago

matwood 1y ago

The administration still routinely presents VAT as a tariff. To think there is any real policy thought behind the actions is akin to looking for meaning in the clouds.

nkozyra 1y ago
"Clouds are simply a negotiating tactic"
trelane 1y ago
To some extent, they seem interchangeable. For instance, any time System76 is brought up for Europeans, VAT is immediately mentioned, along with why they don't have a European distribution center. Why would opening a European distribution center be relevant if you have to pay the same VAT either way? A few examples: https://ubuntuforums.org/showthread.php?t=2204089 https://ubuntuforums.org/showthread.php?t=2204089 https://www.reddit.com/r/System76/comments/1c9djrj/taxes_on_shipping_to_europe/ https://www.reddit.com/r/System76/comments/1c9djrj/taxes_on_...
- matwood 1y ago
  The VAT is akin to a sales tax. It's paid regardless of where the item is manufactured or distributed from (and mostly regardless of the item). The US typically applies between 5-10% sales tax on most items. I have no idea why someone from System76 would think it's relevant to have an EU distribution center, but it wouldn't change the VAT. BTW, it's not just the EU that wants you to pay the sales tax when bringing items across the border, but the US also. It just so happens that it's rarely if ever enforced. EDIT I should add that the key difference of the VAT and tariff is that VAT is not made to advantage one product over another. It's simply a sales tax on nearly all products, just like the US sales taxes.
  - trelane 1y ago
    > have no idea why someone from System76 would think it's relevant to have an EU distribution center, but it wouldn't change the VAT. It seems to be the customers asking for one, not System76. They were planning to open one, though. > VAT is not made to advantage one product over another. Like sales tax, there are different (and often zero) rates depending on product (same link as before)
    - tzs 1y ago
      >> VAT is not made to advantage one product over another. > Like sales tax, there are different (and often zero) rates depending on product (same link as before) But those different rates depend on the product category, not the product manufacturer or place of origin. The whole point of tariffs is to base rates on place of origin.
      - trelane 1y ago
        > But those different rates depend on the product category, not the product manufacturer or place of origin. They do, though: https://stripe.com/en-ch/resources/more/import-tax-germany https://stripe.com/en-ch/resources/more/import-tax-germany
        1y ago
ajross 1y ago
Well, I mean, sorta? This is the point where, indeed, rational discussion can happen. In the real world, VATs and tariffs are both taxes collected at the point of trade. The distinction is just about what boundary constitutes a "trade" and what accounting is done to determine the "value" of the trade. But they're close cousins and do most of the same thing and can be used for most of the same policy purposes. But again, that's not what's happening in US policymaking right now. They don't want tariffs, they want "Tarrifs!", and splitting hairs over the precise definition isn't going to change their mind.
- pineaux 1y ago
  No this is incorrect. The VAT is paid by all the steps in the line and reclaimed until it hits the final seller. That seller collects the VAT and pays it to the taxman. If you import something into a European country, you pay VAT but the VAT is reclaimable basically immediately. Many European countries allow you to postpone the payment of vat as long as you are VAT-registered in that country. You can then declare it to your VAT tax return and basically deducted in the same return. So although the vat might give some cashflow problems, you cannot put it in the same ballpark as a tariff or import tax.
  - ajross 1y ago
    FWIW, I don't see how any of that rebuts the idea that VATs and tariffs are both taxes collected at the point of trade and that they can be used for basically all of the same policy purposes (which, as we all know, is not limited to revenue generation). Yes yes yes, complex rules are complicated. So what? You can do things with a VAT that you can with a tariff, and that you can not with an income tax or estate tax or usage fee or whatever. They are closely related policy instruments.

smitty1e 1y ago

> None of these arguments were presented in a reasonable way, with numbers, ahead of a policy decision that made a considered attempt to find an optimal balance. TFA is the transcript of an historical overview lecture, not a formal economic thesis on the topic, much less, a journal article. Your point, while valid, might be enhanced by some counter-linking.

watwut 1y ago
> President Trump wants to level this playing field. No. It is an attempt to sanewash conservatives, because that is the whole reason for being for this university. The part about Germany and cars is also crap.
- smitty1e 1y ago
  > The part about Germany and cars is also crap. So, could you suggest a link to a solid refutation?
  - orwin 1y ago
    Anybody who understands what VAT is and how it works cannot take this part of the article seriously. I hate VAT, I think it should cease to exist (it is still marginally better than sale taxes) but I made the effort to actually try to understand how it works before writing bullshit about it on basically a blog post.
    - watwut 1y ago
      The article is lying. At this point, it is not reasonable to assume this is just not understanding things. People who work in these institutions lie, they are paid for lying and they do it to project their ideological agenda.
      - smitty1e 1y ago
        > The article is lying. A legless assertion. Could you be more specific with the objection, please?