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Thats not going to happen. We are going to tax these companies. Sales in the EU can and are regulated and taxed, the problem is some issues like varying tax rat

Thats not going to happen. We are going to tax these companies. Sales in the EU can and are regulated and taxed, the problem is some issues like varying tax rates (Luxembourg) and various issues like the double Irish Dutch sandwich (that Apple invented) which was based on differences between tax definitions between countries. These can and will be fixed. Just because you, personally, hate government spending, does not mean we are going to remove corporation tax. Putting all taxes directly on a few prices, like increasing VAT (retail sales) or income tax (cost of hiring labour) is far more distortionary than spreading taxes between more prices (like returns on capital, as roughly corporation taxes are).

mike_hearn 12y ago
I don't hate government spending, what makes you think that? What I hate (perhaps hate is a strong word) is arbitrary and vague systems of laws. Corporation tax is riddled with these and it just undermines confidence in all government. You say yourself these "loopholes" are nothing more than disagreements between governments about how tax works. Thus the "solution", if you want to call it that, is that countries have to stop competing on tax rates. If Greece wants to charge corporation tax of 80% then everyone else has to as well otherwise they're enabling avoidance? That makes no sense and is fundamentally against national sovereignty. Low corporation taxes are quite popular amongst the Irish because they correctly perceive that it leads to lots of jobs. Who are we to say that they got it wrong? We can see how arbitrary this all is with the fact that these companies, which have done business this way for years in full view of national governments, are only now getting investigated once government spending cuts start making politicians unpopular. If these arrangements actually were illegal under clearly defined law they would have been investigated and tried a long time ago. IIRC the OECD thinks corporation tax has much higher deadweight costs than other forms of tax. I read this in an interesting article on the subject here: http://www.theregister.co.uk/2012/11/25/tax_and_tech_biz/ http://www.theregister.co.uk/2012/11/25/tax_and_tech_biz/ .. however the original link was dead last time I looked.
- justincormack 12y ago
  The problem abot making a precise tax system is that then getting round it is easy. Simplicity is clearly a key point, but somehow our political processes are not very good at that alas. Corporation tax also has huge subsidies, eg allowing interest on debt as an expense should go, which would allow the rate to be cut. No deductions should be allowed on any tax...

mike_hearn 12y ago

I don't hate government spending, what makes you think that? What I hate (perhaps hate is a strong word) is arbitrary and vague systems of laws. Corporation tax is riddled with these and it just undermines confidence in all government. You say yourself these "loopholes" are nothing more than disagreements between governments about how tax works. Thus the "solution", if you want to call it that, is that countries have to stop competing on tax rates. If Greece wants to charge corporation tax of 80% then everyone else has to as well otherwise they're enabling avoidance? That makes no sense and is fundamentally against national sovereignty. Low corporation taxes are quite popular amongst the Irish because they correctly perceive that it leads to lots of jobs. Who are we to say that they got it wrong? We can see how arbitrary this all is with the fact that these companies, which have done business this way for years in full view of national governments, are only now getting investigated once government spending cuts start making politicians unpopular. If these arrangements actually were illegal under clearly defined law they would have been investigated and tried a long time ago. IIRC the OECD thinks corporation tax has much higher deadweight costs than other forms of tax. I read this in an interesting article on the subject here: http://www.theregister.co.uk/2012/11/25/tax_and_tech_biz/ http://www.theregister.co.uk/2012/11/25/tax_and_tech_biz/ .. however the original link was dead last time I looked.

justincormack 12y ago
The problem abot making a precise tax system is that then getting round it is easy. Simplicity is clearly a key point, but somehow our political processes are not very good at that alas. Corporation tax also has huge subsidies, eg allowing interest on debt as an expense should go, which would allow the rate to be cut. No deductions should be allowed on any tax...