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One can argue that tax jurisdictions compete with each other in a market. Which is a good thing, as it helps put an upper bound on how aggressive a jurisdiction
by ef4 14y ago
One can argue that tax jurisdictions compete with each other in a market. Which is a good thing, as it helps put an upper bound on how aggressive a jurisdiction can get before capital starts fleeing.
But of course this picture is missing one of the key mechanisms of a truly free market -- there's no market pricing of the market participants themselves. You can't buy out a government that's acting foolishly.
- cdtwigg 14y agoIt's a refundable credit, meaning that the government will reimburse the company for VFX work above and beyond its tax liabilities. How is this "tax jurisdictions competing" and not a direct government subsidy? http://www.bcfm.ca/faq/#pstc4 http://www.bcfm.ca/faq/#pstc4
- ef4 14y agoI think that's a distinction without a difference. Whether the government taxes you less, pays you directly, or puts tariffs on your foreign competitors, it all amounts to a subsidy in the end. (And I don't disagree that it's a foolish idea.)