Speaking after a meeting with Bavaria’s state Cabinet atop the Zugspitze mountain, Germany’s highest peak, Merz said that continuing with the 15% minimum tax in Europe would put the continent’s economy at a disadvantage.

  • Don_alForno@feddit.org
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    1 day ago

    Microsoft can sell a German an Office license, and they are liable for zero tax on any profit if the sale is from the U.S. entity.

    That is a political decision and can be changed at will.

    The user above is correct: if the U.S. won’t impose a tax floor, companie can and will relocate their (at least for tax purposes), if their tax floor (including subsidies and exemptions) is lower.

    If it were that simple, Trump would not have had to threaten the G7 for an exception for his companies, he could just have withdrawn from the treaty. This is about the other countries in the treaty not taxing american companies. Because that is the only way you can combat tax havens: by collecting the tax that wasn’t paid there yourself, regardless of company presence. “Wanna do business here? Pay your Tages.” Companies can evade that if it’s just one or two countries doing it, but not if it’s a broad alliance.

    • JasSmith@sh.itjust.works
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      8 hours ago

      That is a political decision and can be changed at will.

      How do you propose taxing profits from other countries would work? Send the military in and take it by force? Ban the company from selling products in Germany unless they pay some arbitrary amount like North Korea? Do you pro-rata their global profits? How do you reconcile when some regions are more or less profitable than others? You imply something that is frankly crazy. Not even Zimbabwe tried anything like that, and they stole huge swathes of land and ended up with a starving population.

      If it were that simple, Trump would not have had to threaten the G7 for an exception for his companies, he could just have withdrawn from the treaty.

      That is exactly what he did. It’s in the article. Please read it.

      • Don_alForno@feddit.org
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        7 hours ago

        How do you think the USA tax their citizens living abroad (they tax by passport, not by residence)? Send in the military and take it by force? Probably not, but if you want to return I guess you should better have paid your taxes each year.

        Ban the company from selling products in Germany unless they pay some arbitrary amount like North Korea

        It may come as a surprise to you, but we ban a lot of products from entering the EU for a large variety of reasons. This wouldn’t be the worst reason.

        How do you think we are making Apple comply with the EU mandated USB-C charging port? We don’t allow iPhones without it into the shared market, that’s how.

        You imply something that is frankly crazy. Not even Zimbabwe tried anything like that, and they stole huge swathes of land and ended up with a starving population.

        See above. Also, Zimbabwe is one small and rather unimportant country. We are talking about an international treaty with more than 140 member countries. A company can divest from Zimbabwe. Let’s see them do it with these 140 countries.

        Frankly, you’re being ridiculous.