The OECD says 137 countries are scrambling to rewrite international tax rules by the end...

nanoguy

TS Addict
Staff member

The governments of 137 countries have begun work on a significant rewrite of international tax rules which target tech giants and other multinational corporations. The initiative is meant to prevent a new trade war, as many of the countries involved already have their own implementations in the works or passed into actual law.

The plan was first announced by the Organization for Economic Cooperation and Development (OECD) in October 2019, after preliminary talks concluded with an outline agreement on changing tax regulations dating as far back as 1920s.

The countries involved have started sending proposals, and officials will meet in Paris to conduct negotiations on where tax should be paid and "what share of profit should be taxed" when digital businesses do not have a physical presence in a given market.

The OECD says there is an urgent need to compile a draft as quickly as possible, as a growing number of countries are scrambling to craft their own "digital tax." One prime example is France, whose digital tax invoked a promise from US President Donald Trump to levy import taxes on $2.4 billion worth of French products.

Companies like Apple, Google, Amazon, Facebook, and other tech giants have been using low-tax locations like Ireland over the years to avoid cutting into their profits, but they've done so to the extent that there is now a powerful consensus among countries to establish a fair system that works in today's context, where companies can book most of their revenue from countries where they sell their digital services without a physical presence.

France hinted earlier this month that it might hold off on its digital tax until the end of the year, mostly because of insistence from other EU members. Meanwhile, the OECD has to present at least a preliminary consensus-based solution that will apply to companies that operate online search engines, social media platforms, online marketplaces, streaming services, cloud computing, and advertising.

Amazon and Apple so far have expressed their support for OECD's efforts, mainly because they would be an important step in preventing double taxation and "unilateral distortive measures."

Apple CEO Tim Cook noted that "logically everybody knows it needs to be rehauled, I would certainly be the last person to say that the current system or the past system was the perfect system. I’m hopeful and optimistic that the OECD will find something."

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ypsylon

TS Addict
You can avoid taxes just fine.


And about bloody time. It's not normal that hard working people who scrape from 1st to 1st (or weekly like in the US), pay like 30-40% tax, but corporations exploiting and earning billions of $ every week pay 0%. This is impossible to sustain without global revolt.
 

OortCloud

TS Evangelist
And about bloody time. It's not normal that hard working people who scrape from 1st to 1st (or weekly like in the US), pay like 30-40% tax, but corporations exploiting and earning billions of $ every week pay 0%. This is impossible to sustain without global revolt.
Couldn't agree more - these big companies like Amazon and Google who pretend to be all socially-conscious are actually utterly immoral. Avoiding paying tax is basically saying I want to squat in your country - I will use your roads, your welfare system, your hospitals etc, but I wont contribute to their upkeep because I value giving my owners and shareholders as much money as I can and don't really care about any of you at all. Google are past masters at the “Double Irish, Dutch sandwich” tax evasion scheme which allows them to pay a fraction of the tax they should. This means we all get sh1t pensions while Google execs and shareholders live the high life...
 
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mshrf

TS Rookie
Couldn't agree more - these big companies like Amazon and Google who pretend to be all socially-conscious are actually utterly immoral. Avoiding paying tax is basically saying I want to squat in your country - I will use your roads, your welfare system, your hospitals etc, but I wont contribute to their upkeep because I value giving my owners and shareholders as much money as I can and don't really care about any of you at all. Google are past masters at the “Double Irish, Dutch sandwich” tax evasion scheme which allows them to pay a fraction of the tax they should. This means we all get sh1t pensions while Google execs and shareholders live the high life...
Now here's the problem with your comment and this article: these companies are paying their taxes exactly like they should. And I'm not talking about any tax planning, but the system as a whole. It's NOT suitable for the digital economy. The system is from a time when the factory would produce in country A and their local store would sell in country B. It obviously doesn't work like that anymore. Also, corporate social responsibility is getting more and more entwined within the tax function.
 
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jason lee

TS Rookie
You can avoid taxes just fine.


And about bloody time. It's not normal that hard working people who scrape from 1st to 1st (or weekly like in the US), pay like 30-40% tax, but corporations exploiting and earning billions of $ every week pay 0%. This is impossible to sustain without global revolt.
You can avoid taxes just fine.


And about bloody time. It's not normal that hard working people who scrape from 1st to 1st (or weekly like in the US), pay like 30-40% tax, but corporations exploiting and earning billions of $ every week pay 0%. This is impossible to sustain without global revolt.

The problem is that you’re comparing “normal people” with corporations. Corporations aren’t people. Arguing that corporations should pay more taxes is as arbitrary as saying apples should be produce more juice like oranges. If you want to state that people that get rich off corporations should pay more tax, well then that might make a bit more sense.
 

p51d007

TS Evangelist
The "tax" rate (using USA as an example) is nothing more than a way government can control the population. It's suppose to be EQUAL protection under the law, but we all know they make loopholes
for themselves, and their buddies in business.
The BEST thing, would be go to a fair/flat tax. It's been discussed, researched and debated, but, unless the people vote for such a thing, it will never happen, because politicians don't want to give up their power.
Repeal the 16th amendment, institute a fair/flat tax and be done with it. In the case of the fair tax, it would also include a "prebate" on the essentials of food, utilities, rent etc. EVERYONE regardless, will pay it, including politicians and "the corporation giants".
It would require approximately a 22.5% tax rate. "But! I can't afford to pay that much in taxes!"
It's been shown, that the average cost of goods and services has a "built in" tax rate of around 22%,
so, if that is removed, and the fair tax put into place, a 50 dollar item, would remain 50 dollars.
"But what if some greedy corporation doesn't reduce the "built in" tax. Then, they would be
22-23% more expensive.

Look at it this way. Say you are a hardware store that sells lumber. A company cuts down the tree,
sells it to a lumber mill. They are taxed on that sale. The lumber mill turns the tree into lumber and
sells it to a wholesale lumber store. They are taxed. The wholesaler sells the end product to the
hardware store. They are taxed. You purchase the lumber, you are taxed.

The 16th amendment, implemented in the early 1900's was a ploy to "soak the rich". Did it work?
Well, the "rich" came up with charity foundations, and found a loophole to hide their wealth.
They still do it today!
The entire taxing system needs a complete overhaul, but, unless the people show up in DC with
pitchforks & torches (or an article 5 convention of the states), don't look for that to happen.
 

OortCloud

TS Evangelist
Now here's the problem with your comment and this article: these companies are paying their taxes exactly like they should. And I'm not talking about any tax planning, but the system as a whole. It's NOT suitable for the digital economy. The system is from a time when the factory would produce in country A and their local store would sell in country B. It obviously doesn't work like that anymore. Also, corporate social responsibility is getting more and more entwined within the tax function.
\ am not saying what they are doing broke the law, just that they are willing to spend millions coming up intricate schemes to avoid paying the tax they know damn well they should be paying. Shipping huge amounts of money offshore to countries which have less scruples about taking dodgy foreign currency for a much lower tax fee. They know this is morally wrong, but do it anyway - because more money for them. They try very hard to keep this quiet as it's bad for their public image - hence the term 'Tax Shaming'. To make out there is nothing wrong with what they are doing just because it skirts through 50 loopholes in the law is no argument at all.
 

bexwhitt

TS Evangelist
The "tax" rate (using USA as an example) is nothing more than a way government can control the population. It's suppose to be EQUAL protection under the law, but we all know they make loopholes
for themselves, and their buddies in business.
The BEST thing, would be go to a fair/flat tax. It's been discussed, researched and debated, but, unless the people vote for such a thing, it will never happen, because politicians don't want to give up their power.
Repeal the 16th amendment, institute a fair/flat tax and be done with it. In the case of the fair tax, it would also include a "prebate" on the essentials of food, utilities, rent etc. EVERYONE regardless, will pay it, including politicians and "the corporation giants".
It would require approximately a 22.5% tax rate. "But! I can't afford to pay that much in taxes!"
It's been shown, that the average cost of goods and services has a "built in" tax rate of around 22%,
so, if that is removed, and the fair tax put into place, a 50 dollar item, would remain 50 dollars.
"But what if some greedy corporation doesn't reduce the "built in" tax. Then, they would be
22-23% more expensive.

Look at it this way. Say you are a hardware store that sells lumber. A company cuts down the tree,
sells it to a lumber mill. They are taxed on that sale. The lumber mill turns the tree into lumber and
sells it to a wholesale lumber store. They are taxed. The wholesaler sells the end product to the
hardware store. They are taxed. You purchase the lumber, you are taxed.

The 16th amendment, implemented in the early 1900's was a ploy to "soak the rich". Did it work?
Well, the "rich" came up with charity foundations, and found a loophole to hide their wealth.
They still do it today!
The entire taxing system needs a complete overhaul, but, unless the people show up in DC with
pitchforks & torches (or an article 5 convention of the states), don't look for that to happen.
The USA needs a left leaning party not what it has got right now which is a Radical Right wing party and a right leaning center party. What Bernie Sanders is proposing is hardly radical left wing in other countries.
 

Adi6293

TS Guru
You can avoid taxes just fine.


And about bloody time. It's not normal that hard working people who scrape from 1st to 1st (or weekly like in the US), pay like 30-40% tax, but corporations exploiting and earning billions of $ every week pay 0%. This is impossible to sustain without global revolt.
This is a good video on this whole tax thing
It made my blood boil and I'm not American
 

Mr Majestyk

TS Evangelist
You can avoid taxes just fine.


And about bloody time. It's not normal that hard working people who scrape from 1st to 1st (or weekly like in the US), pay like 30-40% tax, but corporations exploiting and earning billions of $ every week pay 0%. This is impossible to sustain without global revolt.
Yeah right, I'll bet you voted for the billionaire to save the working class too.
 

mbrowne5061

TS Evangelist
You can avoid taxes just fine.


And about bloody time. It's not normal that hard working people who scrape from 1st to 1st (or weekly like in the US), pay like 30-40% tax, but corporations exploiting and earning billions of $ every week pay 0%. This is impossible to sustain without global revolt.
That's what happens when you subscribe to "trickle down" economic theory. Giving corporations all the tax breaks ever should let them create more jobs and pay their employees more - enough so that a 30-40% tax on the individual 'should not' matter. It doesn't work this way at all in reality, but that is the pitch they try to sell you.

We need some trickle up economics. Feed the people so that they can feed the companies, not the other way around.