International France Imposes New Digital Tax Targetting Big U.S Tech Firms With New "GAFA" Law
- Thread starter Arkain2K
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I already made a thread on this. Amazon has already passed the cost onto French sellers.
Virginie Lemaire recently opened her email to an unsettling message from Amazon: fees for sellers like her in France will be increasing by 3%.
Lemaire, a single mother of two, started her jewelry company Perle d’un jour in 2011. Trained as an artisan jeweler, she makes handmade custom pieces like necklaces, bracelets and rings.
The French small business owner started selling her products on Amazon two years ago and now generates one-fifth of her sales from the e-commerce giant’s marketplace.
So it was an unwelcome surprise when she found out Amazon would be raising seller fees for her and thousands of other small and medium-sized French businesses starting in October. The reason the company cited was simple: a 3% digital tax passed by the French government in July.
Amazon’s move appears to directly conflict with the French government’s aim of leveling the playing field between Big Tech and small and medium-sized enterprises, and further complicates France’s effort to rein in companies like Amazon, Facebook and Google.
The French tax has already faced significant backlash. The President Donald Trump administration initiated an investigation into the measure and threatened retaliatory tariffs, saying the tax “unfairly targets American companies.” Economists and tech firms including Amazon had warned France’s tax would ultimately result in higher prices for consumers.
Executives from Amazon, Facebook and Google will testify at a U.S. government hearing on the French digital tax Monday.
https://forums.sherdog.com/threads/...l-tax-to-thousands-of-french-sellers.4003029/
Virginie Lemaire recently opened her email to an unsettling message from Amazon: fees for sellers like her in France will be increasing by 3%.
Lemaire, a single mother of two, started her jewelry company Perle d’un jour in 2011. Trained as an artisan jeweler, she makes handmade custom pieces like necklaces, bracelets and rings.
The French small business owner started selling her products on Amazon two years ago and now generates one-fifth of her sales from the e-commerce giant’s marketplace.
So it was an unwelcome surprise when she found out Amazon would be raising seller fees for her and thousands of other small and medium-sized French businesses starting in October. The reason the company cited was simple: a 3% digital tax passed by the French government in July.
Amazon’s move appears to directly conflict with the French government’s aim of leveling the playing field between Big Tech and small and medium-sized enterprises, and further complicates France’s effort to rein in companies like Amazon, Facebook and Google.
The French tax has already faced significant backlash. The President Donald Trump administration initiated an investigation into the measure and threatened retaliatory tariffs, saying the tax “unfairly targets American companies.” Economists and tech firms including Amazon had warned France’s tax would ultimately result in higher prices for consumers.
Executives from Amazon, Facebook and Google will testify at a U.S. government hearing on the French digital tax Monday.
https://forums.sherdog.com/threads/...l-tax-to-thousands-of-french-sellers.4003029/
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Why do you feel the needs to lie??
Ireland says these companies ARE paying theirs E.U income tax obligations on their E.U profits in accordance to E.U tax codes every single year, and their effective tax rate is actually a bit higher than Ireland's average corporate tax rate of 12.5%.
These financial data are public information that are released every single year. Do you have any proof for your outlandish claim, as if Ireland just cooked their books and the annual E.U income taxes that these U.S companies paid them annually didn't actually happen?
Either Ireland is lying, or you are lying:
Google paid Ireland €171m in taxes last year on profits of €1.16 billion, giving the company an effective tax rate here of 14.69%.
This compares with a tax bill of €163.8m on profits of €1.18 billion for 2016 (effective tax rate of 13.8%).
According to the US firm's latest set of financial accounts for its Irish operation, turnover increased by €5.9 billion in 2017 to €32.2 billion, with the rise primarily driven by higher advertising revenue.
https://www.rte.ie/news/business/2018/1123/1012900-google-ireland-paid-171m-in-tax-last-year/
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https://www.theguardian.com/business/2017/sep/21/tech-firms-tax-eu-turnover-google-amazon-apple
https://www.rt.com/business/414891-google-tax-bermuda-scheme/
https://www.theguardian.com/technol...e-offices-paris-raided-french-tax-authorities
https://euobserver.com/economic/138954
WhY ArE You LYinG
Do you work for Google ?
https://www.rt.com/business/414891-google-tax-bermuda-scheme/
https://www.theguardian.com/technol...e-offices-paris-raided-french-tax-authorities
https://euobserver.com/economic/138954
WhY ArE You LYinG
Do you work for Google ?
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The funny part is, Facebook is my main client in my business.
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Literally none of these articles substantiate the claim that they do not pay taxes. All these prove is that the EU simply wants them to pay more taxes because tHeY dOnT pAy eNoUgH dUe tO lOwEr rAtEs In certain member states and it's nOt fAiR.
Boo fucking hoo
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Yeah exactly, they sell products heavily in some markets and use fiscal optimisation to pay less taxes by outsourcing their benefits in more advantageous markets.
It's quite ridiculous to defend that.
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Great point. Somehow these companies still get support from their 'real' home states which I think should not be the case when shit hits the fan.
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Beware. Other Nations Will Follow France With Their Own Digital Tax.
The international tax system is behind the times. But we need coordinated reform.
By Lilian V. Faulhaber, Georgetown University Law Center | July 15, 2019
Last Thursday, the French Senate passed a digital services tax, which would impose an entirely new tax on large multinationals that provide digital services to consumers or users in France.
Digital services include everything from providing a platform for selling goods and services online to targeting advertising based on user data, and the tax applies to gross revenue from such services. French politicians and media outlets have referred to this as a “GAFA tax,” meaning that it is designed to apply primarily to companies such as Google, Apple, Facebook and Amazon — in other words, multinational tech companies based in the United States.
The digital services tax awaits the signature of President Emmanuel Macron, who has expressed support for the measure, and it could go into effect within the next few weeks. But it has already caused significant controversy, with the United States trade representative opening an investigation into whether the tax discriminates against American companies, which in turn could lead to trade sanctions against France.
The French tax is not just a unilateral move by one country in need of revenue. It is part of a much larger trend, with countries over the past few years proposing or putting in place a veritable alphabet soup of new international tax provisions. They have included Britain’s DPT (diverted profits tax), Australia’s MAAL (multinational anti-avoidance law), and India’s SEP (significant economic presence) test, to name but a few. At the same time, the European Union, Spain, Britain and several other countries have all seriously contemplated digital services taxes like the one just passed by France.
These unilateral developments differ in their specifics, but they all seek to tax multinationals on revenue that countries believe they should have a right to tax, even if international tax rules do not grant them that right. In other words, they all reflect a view that the international tax system has failed to keep up with changes in the economy.
The general outlines of that system originated in the early 20th century, and all of these recent proposals and provisions suggest that it needs to be updated for a world in which companies can make significant amounts of income without ever being physically present in a country or selling any tangible goods.
In response to these many unilateral measures, the Organization for Economic Cooperation and Development is working with 131 countries to reach a consensus on an international solution by the end of 2020. Both France and the United States are involved in the organization’s work, but France’s digital services tax and the American response raise questions about what the future holds for the international tax system.
One possible path is for countries to follow France’s lead and impose their own digital services taxes. The downsides of this are not only that the United States may take retaliatory measures but also that such taxes could subject companies to layers of new taxes, all with slightly different rates, definitions of digital services and determinations of taxing rights. This could lead to the same revenue being taxed multiple times or could make it harder for countries to get what they see as their due if others have already staked a claim to that revenue.
Another possible path would be for countries to see France’s move as a portent of the disorder that could arise if they do not reach an agreement at the international level. This could push them to participate more fully in the O.E.C.D.’s digital tax project. The proposals being considered by that group could lead to significant changes to the international tax system, with the potential for increased taxes, taxation in more countries and new rules for companies.
But the outcome would represent an international solution. The new rules imposed would be coordinated rather than layered over one another, which could offer companies more opportunities to limit double taxation or make use of dispute resolution mechanisms.
France’s planned tax is a clear warning: Unless a broad consensus can be reached on reforming the international tax system, other nations are likely to follow suit, and American companies will face a cascade of different taxes from dozens of nations that will prove onerous and costly.
https://www.nytimes.com/2019/07/15/opinion/france-internet-tax.html
Excellent article.
Regarding the topic, it is time this topic gets solved. Multinationals essentially cheat all countries with the exception of countries who have made being a tax haven their questionable business model, but then make sure they get the full diplomatic support of their 'home' countries. GAFA is just the most striking example of this, but other corporations are guilty of doing similar things.
I think there is a fine line there, however. Consider the following examples (I am not a tax expert by any means):
1) Company has regional headquarters in country A and operates all operations for the continent from there. Customers get their invoice from there. Goods get shipped from there.
2) Company has regional headquarters in country A and operates all own operations for the continent from there. Customers get their invoice from there. Goods get shipped from target countries, but company does not own or operate the goods there (this is done by contracted companies).
3) Company has regional headquarters in country A and operates some operations for the continent from there. The company has a footprint in all countries in the region but no physical location (except logistics) outside of A.
In which of these cases would you say country B should be able to tax the company?
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That's the gist of it.
They all want a piece of Dublin's pie, but they couldn't compete with Dublin's generous 12.5% corporate tax rate, and Dublin refuses to raise their taxes to the same level as them, so now they plans to unilaterally imposing their own tax on the same pot of money taxable in Ireland under E.U laws.
I wouldn't be surprised if the E.U would continue trying to double-tax the pile of money that Apple sent back to the U.S and paid $38 Billion in taxes on it already.
No, the rest of us are just fully capable of reading-comprehension, that's all.
Your outlandish claim that "these companies are not paying taxes" in Europe is already exposed as 100% bullshit. Give it up.
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Never said they're not paying taxes in Europe, but in the market they're operating in, France here, more specifically.
Maybe you're the one not fully capable of reading comprehension.
Quote my outlandish claim that these companies are not paying taxes in Europe.
Who's 100% bullshit now ?
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Are you legitimately retarded, or do you haven't had a clue as to how the E.U taxing scheme works for their member countries?
Just admit you made a dumb-ass claim and move on, rather than being curb-stomped again and again.
Under the E.U laws, why would any companies with no significant presence in France need to pay their corporate income tax again in France when their E.U corporate headquarter is in Ireland, where they already record and pay their corporate income taxes on their E.U profits? Do you even know what Double Taxation is?
And if the European Union is unhappy with their own tax system or how Ireland is charging a more competitive corporate tax rates than most E.U countries, they are welcomed to blow it up and make all these multinational companies establish a separate headquarter in each and every E.U country and pay separate corporate income taxes in each country accordingly, and we'll see how that will turn out.
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Cause they have offices in Paris, London and Amsterdam too ?
And outsource their benefices to Ireland, like subway and multiple others companies ?
Are you legitimately retarded ?
sakfjgadsyukgf
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Some issues @Arkain2K glossed over:
The EU tried to pass this tax increase at the European-level, but a few countries backed out. Remember, the EU generally needs unanimous support to pass any type of bill. So, some of them (France, others) decided to implement it at the national level instead, to sort of force the EU's hand.
Tech companies are uniquely placed to use transfer pricing to lower their tax bill because intellectual property (IP) is much more easily deducted than physical assets are for non-tech companies. So, Google/Facebook/Amazon etc. are not only some of the largest & most successful companies on Earth- they get to use transfer pricing to lower their taxes more than 'regular' Fortune 500 multi-billion dollar companies. Like they didn't already have enough advantages....
The EU tried to pass this tax increase at the European-level, but a few countries backed out. Remember, the EU generally needs unanimous support to pass any type of bill. So, some of them (France, others) decided to implement it at the national level instead, to sort of force the EU's hand.
Tech companies are uniquely placed to use transfer pricing to lower their tax bill because intellectual property (IP) is much more easily deducted than physical assets are for non-tech companies. So, Google/Facebook/Amazon etc. are not only some of the largest & most successful companies on Earth- they get to use transfer pricing to lower their taxes more than 'regular' Fortune 500 multi-billion dollar companies. Like they didn't already have enough advantages....
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So what if they have branch offices in those European cities? How does that change anything about their incorporated E.U headquarter in Ireland under E.U tax laws??
This is actually amusing, it's been a long time since I last seen a Sherdogger so ignorant of the subject matter continue digging himself head-first into a hole this deep, for apparently no reason at all.
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So what if they have branch offices in those European cities? How does that change anything about their incorporated E.U headquarter in Ireland under E.U tax laws??
This is actually amusing, it's been a long time since I last seen a Sherdogger so ignorant of the subject matter continue digging himself head-first into a hole this deep, for apparently no reason at all.
https://amp.theguardian.com/technology/2019/feb/05/apple-to-pay-10-years-of-back-taxes-to-france
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Smaller E.U countries that competes with bigger E.U members using a lower tax rate would naturally object the E.U's recent effort to "harmonize" European tax rates across the board, since that's basically taking away their competitive advantage and offering them nothing in return.
On the other hand, looks like all members of the OECD are serious about overhauling the international tax codes on a global scale this time, particularly in regards to the transfer pricing and nexus rules. The main motivation force is ofcourse the question of who gets which piece of the pie.
Ireland needs to wean themself off this market fast, as the FDI for their financial sector is going to plummet this time next year when the OECD introduce the new rules.
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OECD's Digital Tax Work Has Broad Ramifications For Ireland
by Jason Gorringe | 22 August 2019
by Jason Gorringe | 22 August 2019
As a small open economy, Ireland may be affected significantly by the OECD's proposals to modify how taxing rights are allocated among countries, Irish business association Ibec has said.
The OECD is developing new digital tax rules that would be presented for adoption internationally at the end of 2020, which will focus on two central pillars.
First, the OECD will review existing rules that divide up among jurisdictions the right to tax the income of multinational enterprises, including traditional transfer pricing rules and the arm's length principle. It will look at how these can be modified to take into account the changes that digitalization has brought to the world economy. This will require a re-examination of the so-called "nexus" rules – namely how to determine the connection a business has with a given jurisdiction – and the rules that govern how much profit should be allocated to the business conducted there.
Under the second pillar, the BEPS Inclusive Framework countries will seek to resolve remaining BEPS issues and will explore two sets of interlocking rules, designed to give jurisdictions a remedy in cases where income is subject to no or only very low taxation. This work looks to minimize tax base erosion and profit shifting by ensuring that income is not inappropriately shifted to territories that levy no or low tax rates, by ensuring that income is subject to at least a minimum level of tax, wherever that may be.
This would involve the introduction of a new effective tax rate test, which would also enable stakeholders to better determine in a harmonized way how much tax multinationals pay internationally.
In a new report, Ibec highlighted potential risks to Ireland's tax framework, its competitiveness, and to revenue receipts. It noted that there is "clear renewed political momentum behind global multilateral tax reform through" pillar two. It said that proposals concerning "the allocation of tax bases between countries and a potential for global minimum effective corporate tax rate" will be significant for Ireland.
Ibec said that proposals under pillar one "will mean some re-allocation of taxing rights to larger importing countries and, as a small exporting country, may mean the Irish Exchequer will lose a proportion of its corporate tax base." However, it argued that the Irish business community is more concerned about the possible introduction of a global minimum effective corporate tax rate.
Ibec stressed that, were any such measure introduced, the rate would need to be "set at a level which focuses on addressing actual profit shifting concerns" and that it should not "infringe" on Ireland's "right to set competitive tax rates."
Ibec urged that Ireland needs to prepare for a post-BEPS world in which the non-tax elements of the country's business model will play a greater role in attracting investment.
https://www.tax-news.com/news/OECDs...Broad_Ramifications_For_Ireland____97254.html
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Just to help you :
“The French tax authority recently concluded a multiyear audit of our French accounts and the adjustment will be reflected in our publicly filed accounts.
“We know the important role tax payments play in society and we pay all that we owe according to tax laws and local customs wherever we operate.”
“The French tax authority recently concluded a multiyear audit of our French accounts and the adjustment will be reflected in our publicly filed accounts.
“We know the important role tax payments play in society and we pay all that we owe according to tax laws and local customs wherever we operate.”
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well done France, if these companies want to operate in our nations they should be paying their fare share of taxes
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Beware op gonna call you an ignorant and a retard.
