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BBC News - Rich nations back deal to tax multinationals. Leading world economies back ‘historic’ plan to tax multinational companies and limit tax avoidance.

BBC News - Rich nations back deal to tax multinationals. Leading world economies back ‘historic’ plan to tax multinational companies and limit tax avoidance.

Ephemeral-Throwaway

On the surface this sounds good and what reasonable people have wanted for years.


whatsthiscrap84

Bbc news tomorrow - rich multinational companies find loopholes.


longrosinante

*already know the loop holes


Lythronax82

*Lobbied to include their preferred loopholes


SoMuchForSubtleties0

Paid/corrupted politicians for loopholes O


dontworrymartians

SFO still sleeping at the wheel...


R_Jay101

Tax havens be like: "Would you like a 100% corporate tax rebate?"


losimagic

BBC News this evening*


zanock

Multination companies find Ireland. FTFY


JonnyArtois

More to go through Ireland.


Maulvorn

Honestly things like capital gains tax rises do bring in more revenue


[deleted]

[удалено]


Iwantadc2

Lol. They aren't really 'countries' (they'll argue) and have their own laws on tax etc. *They ain't changing shiiiiiit* Its also piss easy to not make much 'profit' to tax.


AsleepNinja

Well if the method for reducing profit is investment in R&D I'd say that's okay


DorothyJMan

It's not.


AsleepNinja

Okay, based upon?


DorothyJMan

Basic knowledge of how multinational tax avoidance works, which is cooking the books between their subsidiaries to make huge amounts of profit without showing any taxable profit on the books - which is when /u/Iwantadc2 was alluding to. None of this actually involves spending money on things such as R&D, as that would reduce real profit.


Ambitious_Reach2192

Do you know exactly how it works or are you just talking out of your arse?


DorothyJMan

I know enough about how it works to call out the naivety of thinking it'll be spent on R&D (which by the way, why would it be a good thing for Facebook and Google et al to spend even more money figuring out how to influence our purchases and sell more ads and data?). Here's a handy intro summary for you: https://blogs.lse.ac.uk/businessreview/2020/09/29/how-multinationals-circumvent-anti-tax-avoidance-regulations/#:~:text=A%20subsidiary%20of%20an%20MNC,reduces%20firms'%20overall%20tax%20bill.


AsleepNinja

You know precisely fuck all. You've even linked a source talking about tax avoidance which is fundamentally separate to ploughing profits into r&d. Fucking bravo for conflating things you don't understand. Encouraging investment into r&d is a net boom to society, even if it means slightly less taxable revenue.


RunningFatBear

not op but can you walk me through this please let’s say Facebook invests in rd to avoid paying taxes. how is this a net boom to society? a company chases profits for shareholders so it really should depend on the company right? i don’t believe companies would research and develop what is the best for their customers, they will research and develop ways to earn more money and use less resources to do that, regardless of how good or bad it is for the customer.


DorothyJMan

Mate this is embarassing, you've completely missed the point yourself while being a dickhead in the process. Let me walk you through the thread since you can't seem to keep up. /u/iwantadc2 points out that it's easy to not make much taxable profit (through the methods outlined above) You come in and thought that companies would reduce profits through spending on R&D. I explain that they won't do this, they'll use tax avoidance strategies as detailed in my link and post to avoid making taxable 'on the books' profits while still making huge profits across the company. \> You know precisely fuck all. You've even linked a source talking about tax avoidance which is fundamentally separate to ploughing profits into r&d. The whole conversation is around reducing taxable profits, which for some unexplained reason you think is done through R&D investment (???) while everyone with half a brain and any knowledge of multinationals knows that they use tax avoidance strategies like I kindly linked to avoid taxable profits. They are both methods of avoiding tax, so are not 'fundamentally seperate' or mistakenly conflated. Ironically, *you* conflated /u/iwantadc2's post about tax avoidance strategies with R&D research, showing that *you* know precisely fuck all about how these things work. \> Fucking bravo for conflating things you don't understand. Right back at you. I've never seen someone miss the point so spectacularly, and double down and something they very obviously have no idea about. \> Encouraging investment into r&d is a net boom to society, even if it means slightly less taxable revenue. Overall I agree with this. But this isn't what's going to happen.


advanced-DnD

Netherlands and Ireland aren't on the list, unfortunately.


Iwantadc2

Neither will the real tax havens. Cayman islands say: 'no'


ObviouslyTriggered

They don’t need to be, one of the thing that allows them to operate is the bilateral tax treaties they have with other jurisdictions, with these measures in place you won’t be able to shift revenue through Ireland while ignoring tax due in G7 jurisdictions anymore. This would pass simply because as it current stands you would be stupid not to sign up to this unless you are well Ireland which was indeed singled out by the US.


Locke66

It will be interesting to see how this works out. I hope it's a positive thing but the cynic in me says that it will just be used as a way to standardise the corporate tax rate at 15% across the board while tax avoidance continues.


onlyme4444

They already route everything through Switzerland ...that's why the company name plus 'sarl' is on your invoice. And the Swiss don't give a fuck about any tax rule, like they didn't give a fuck about storing nazi gold during WW2 or any other corrupt despots wealth. Fun story, I was once next to Robert Mugabe at La Reserve in Geneva and got bumped out his way by two of his bouncers. The whole party gave off a menacing aura. Guess he was there to make a deposit or withdrawal !


dontworrymartians

This is a farce. Corporation Tax is probably the easiest tax to avoid. >At the moment companies can set up local branches in countries that have relatively low corporate tax rates and declare profits there. If they really wanted to solve the problem, they would have looked how company can declare a profit in a different place than where it was made. One of ways is IP licensing - basically they create a company that holds intellectual property rights in a low tax country and child companies around the world have to pay fees to use company logo, software etc. Why not make IP licensing non deductible if it was within the same group of companies? This is an entirely fake construct and should be very easy to tackle even using existing laws. When it comes to individuals HMRC could easily come with Loan Charge and retrospectively tax people, saying the loans were a disguised remuneration. They could do the same by requesting the books of Facebook and other big companies and say the licensing fees are fake and therefore non deductible and then ask them to pay tax on it for 10 or more years back. They won't do that, because there is a conflict of interest. Big company can easily pay millions to anyone in charge of such investigation, especially when agencies like SFO don't do anything. Some tax havens actually now forbid setting up IP holding companies - it's a great step. There are of course more loopholes, I am not an expert on that.


[deleted]

>If they really wanted to solve the problem, they would have looked how company can declare a profit in a different place than where it was made. One of ways is IP licensing - basically they create a company that holds intellectual property rights in a low tax country and child companies around the world have to pay fees to use company logo, software etc. Why not make IP licensing non deductible if it was within the same group of companies? This is an entirely fake construct and should be very easy to tackle even using existing laws. Didn't GAAR fix this?


IanWaring

Follow a trend in at least four states of the USA. Tax based on revenue, not on the accountants fiction that is “profit”. Job done. Then just got to sort folks like DFS who offer interest free credit on your sofa via DFS Trading Ltd in the Cayman Islands…


dontworrymartians

It clearly doesn't work if companies still don't pay tax. I heard on LBC today that government can't even request Facebook or Amazon accounting books! Apparently all UK government can do is \_estimate\_ how much they think these companies make profit and then apply some joke tax. Imagine your mum and pops shop could refuse to show books. I'll vote for any party that will come hard on these tax cheats. If that means Facebook or Amazon could have to close then so be it. We will quickly get someone else fill the niche and pay proper tax.


Y57sh2isN7R3TTqgrJ7

They won’t pay it unless they get something in return, like paying a Universal Income to countries, and if they don’t do as they are told then they get their pocket money cut


Aromatic_Lavender

Right, let's get to the point. Did something critical happen? Because this sounds like yet another distraction. There's no way in hell multi million/billion corporations will ever allow this to happen lol.


1984-is_here

I bet the Americans companies are not going to like this, one little bit. They are normally shielded from foreign prosecution. Not having ago I know no company is going to like this but the Americans won't especially. I'm surprised Biden has allowed this. Also I hope this doesn't end up in the court's as well. Which it probably will!


TheCookieButter

> Ms Yellen said there was an understanding that national digital services taxes such as those levied by the UK and EU countries would be scrapped and replaced by the new agreement. Such taxes are regarded by the US as unfairly targeting American technology giants. They get something out of it, and the 15% is low. Plus, there are probably still a dozen things they can do to avoid that like diminishing "profits" or existing magical accounting they all seem to have.


edgellidan

Whats the point when criminal dens like ireland and liechtenstein are still free to operate as they are?


dontworrymartians

The point was to meet, drink some booze, snort some lines, pat everyone on the back, boast about historic moment and then go BAU.


grindog

Cash in Cash outCash goes in cash, cash comes out, if cash goes in but dosent come out then cash cant come i


ancientpenguinlord

It seemed the Tories/right were opposed to this. Did the US put the UK's balls in a vice?