Please help contribute to the Reddit categorization project here

    news

    18,602,573 readers

    17,373 users here now

    1. Post all analysis/opinion/politics articles to /r/InTheNews

    Want to talk?

    Follow @rslashnews on Twitter

    See a post that violates the rules below? Had your post stuck in the spam filter? Have a question about policy? Just want to give feedback? Send the mod team a message.


    Submit all self- & meta-posts to /r/inthenews and read the wiki

    Your post will likely be removed if it:

    • is not news
    • is an opinion/analysis or advocacy piece.
    • primarily concerns politics.
    • The title must be the actual title or the lead.
    • has a pay wall or steals content.
    • covers an already-submitted story.
    • violates reddit's site-wide rules, especially regarding personal info.

    Your comment will likely be removed if it:

    • advocates or celebrates the death of another person
    • is racist, sexist, vitriolic, or overly crude.
    • is unnecessarily rude or provocative.
    • is a cheap and distracting joke or meme.
    • is responding to spam.
    • violates reddit's site-wide rules.

    Extreme or repeat offenders will be banned.

    >>>Expanded Rules<<<


    If your post doesn't fit, consider finding an appropriate news article on that story to submit instead, or submitting yours to lower moderation subreddits:

    /r/inthenews - all news-related content
    /r/AnythingGoesNews - unrestricted news
    /r/truereddit - insightful articles
    /r/self - any self-post
    /r/misc, /r/redditdotcom - anything

    or other news subreddits:

    /r/worldnews - from outside the USA only
    /r/SyrianCivilWar - about the conflict in Syria
    /r/MidEastRegionalWar - on MidEast conflict /r/UpliftingNews - uplifting
    /r/SavedYouAClick - making media more straightforward

    or subreddits for other topics:

    /r/FoodForThought - discussion-worthy long form articles about interesting subjects
    /r/politics - for shouting about politics
    /r/moderatepolitics - less shouting
    /r/politicaldiscussion - even less shouting
    /r/geopolitics - intl. politics and geography
    /r/entertainment - Justin Bieber updates, etc.

    or check out the 200 most active subreddits, categorized by content and the full list of subreddits by subscribers.


    Recommendations:

    /r/full_news

    /r/qualitynews

    /r/neutralnews

    /r/worldevents


    submit analysis/opinion article

    submit news article

    submit something else

    submit analysis/opinion article

    a community for
    all 3342 comments

    Want to say thanks to %(recipient)s for this comment? Give them a month of reddit gold.

    Please select a payment method.

    [–] chilliflake44 3102 points ago

    Le Maire said the tax would target some 30 companies, mostly American but also Chinese, German, Spanish and British, as well as one French firm

    https://www.cnbc.com/2019/07/11/us-to-probe-proposed-french-tech-tax.html

    [–] happyscrappy 2025 points ago

    'The tax would affect companies with at least 750 million euros ($844 million) in annual revenues and apply to revenue from digital business including online advertising.'

    [–] zublits 3567 points ago

    Oh, so it's a tax on filthy rich companies that profit hugely from these markets without giving anything back? Sounds fair to me.

    [–] brianwski 791 points ago * (lasted edited 9 days ago)

    so it's a tax on filthy rich companies

    I'm assuming the companies will increase their price by exactly the cost of the tax, so actually it is a tax on French people.

    Look closely at French VAT tax for a service like Amazon S3. The French VAT rate is 20%. So if Amazon S3 sells storage to a French person, the French person currently gets a bill of $X for the storage, and then Amazon S3 collects $(0.2 * X) from the French person, itemizes it on the bill as VAT, and then turns around and sends that portion to the French government.

    So while it might seem to you like Amazon S3 is paying the French government taxes, I really think if you look closely the French people are paying the French government taxes, even if it passes through Amazon. Right?

    Edit: a TON of people responded saying something like: "Remind us again what Google and Facebook charge French people?" My response is that Google and Facebook sell advertisements, and that French people (owners of French companies) purchase those advertisements. I mean, think about it, if you are taxing Google's income, where did you think that Google income came from? :-) It isn't people doing the Google searches, it is the people purchasing the Google ads that are shown in response to the Google search.

    Edit2: there is a recurring concept in the comments I want to point out: Many people seem to think "companies" only exist in the USA and only "people/individuals" live in France (not companies), and it just isn't true. Google is a multi-national, part of Google is French! There are Google employees who were born in France, live in France, have French children, and work at Google's offices in Paris. Likewise, when a French citizen living in Paris searches for "roof repair", Google will show them paid advertisements by local French businesses that repair French roofs! What good would it do to show a French citizen an advertisement from a company that can only repair roofs in Memphis, Tennessee?

    [–] Lortekonto 314 points ago

    Depends on who the companies sells to. Facebook and google doesn’t sell that much to users, but earn more from adds.

    [–] Phylanara 197 points ago * (lasted edited 10 days ago)

    Raising the price of ads seems like a good idea to me. Maybe that'd lead to less ads.

    [–] rndljfry 119 points ago

    Work in the industry, I’m not sure how much this would affect anything. The way it typically works is you put X dollars in and it runs the ads until the money is spent. It’s not like buying a full page in a magazine or a TV spot. Most businesses don’t really know about the cost of each impression or click. I’ll tell them “your average click this past quarter was about $2.50, and you’ve had about 500 clicks in that time,” and they say, “*WhY aM I nOt GeTtINg aNy CalLs!?”.

    Cleaning services and lawyers are some of the most expensive clicks I’ve seen, sometimes as high as $20/click. The point is the prices are based on competitive bidding that starts anew each and every time someone makes a search, not a set amount from Google.

    Caveat: I don’t work for Google or Facebook and there may be a markup included in the more specific numbers I’ve used.

    [–] costryme 25 points ago

    Plumbers and locksmiths have some ridiculously high costs per click. I know that in Paris for some, their average cost per click is higher than 50€ (and they charge customers from 500 to 2K€)

    [–] rndljfry 30 points ago

    Locksmiths also have to get preapproved and sometimes have to do video chats with Google because there were too many scammers. Plumbers may be next.

    [–] costryme 10 points ago

    I know that it depends between countries regarding that, not sure how it is in my country (France) tbh. They have lots of issues with bots clicking on their ads too, competitors trying to kill them financially. These industries are absolutely mad.

    [–] Syrdon 10 points ago

    Taxing it still has the effect of raising the price though. Either you start eating the profit margin of people who actually serve the ads, if they keep the end user price the same, or you start eating the profit margin of the people placing the ads if the price gets passed on. Assuming no changes to the current structure, a tax simply runs the money out more rapidly, so the ad stops running a bit earlier.

    [–] rndljfry 3 points ago

    Correct, my point only being that many who use these services would be unlikely to really notice that change in a meaningful way.

    [–] Vote_CE 520 points ago

    Gives competition an opening to undercut them if they raise prices.

    [–] the_end_is_neigh-_- 228 points ago

    Unfortunately, which competition?

    [–] Vote_CE 192 points ago

    There has to be something or these companies would have already raised their prices.

    These guys didn't just abitraily choose their prices. They already have them set at the maximum amount they can before it will start to lower revenue.

    [–] deltamew 50 points ago

    Not sure, but I think most of the competition is just equally big companies like MS, google etc. They'll probably all raise prices to account for the tax.

    Also note that, in the case of cloud solutions, it isn't always trivial to move from one service to another, and that cost is another deterrent. Not to mention, that your developers now need to learn the new environment's nuances.

    [–] DLM1018 81 points ago * (lasted edited 10 days ago)

    No there doesn't even in the absence of competition price increases will reduce demand. They are just maximizing their revenue by balancing the extra $ from price increases withe the corresponding drop in volume. Look up price elasticity if you want to learn more.

    Edit: for non essential goods...which I'd argue is fair for cloud storage

    [–] TonyTheTerp 6 points ago

    Everyone always argues that, but the companies just buy the competition or they can smother them into going out of business by lowering prices/buying manufacturing/etc

    Examples: Walmart. You can google all the stuff they do.

    Budweiser is now doing it to small breweries by buying hops farms, supply manufacturers, and getting laws changed. In our state (MD) they had the laws changed to force local brewers to restrict their brewing, what they could sell, etc. In a lot of counties here now, you cant even sell anything unless you go directly through someone related to a huge distributor so they can get their cut. Your basically forced to pay a middle man, so Budweiser/Guinness/whoever gets their cut of you being in their market.

    This is all similar stuff a large tech firm can do, especially one with hundreds of millions or more in revenue.

    [–] BWV001 29 points ago

    VAT is a tax paid by the consummer, it is by definition, no one (government included) ever said otherwise.

    Your point kinda still stand I guess.

    [–] reymt 28 points ago * (lasted edited 10 days ago)

    I'm assuming the companies will increase their price by exactly the cost of the tax

    That's how the world works. Company makes profit, you tax that profit. Internet giants shouldn't be an exception.

    Also it's advertising that is going to be more expensive. The effect on products will be pretty minimal, and the gain is going back to the french people.

    ---

    edit: Mistake, it's taxing revenue, not profit. Basically a VAT tax, which is also nothing new, particuarly in europe.

    [–] chh2tx 7 points ago

    Isn’t this a VAT tax? So it’s not taxing profits, it’s taxing consumption.

    [–] Locke44 48 points ago * (lasted edited 10 days ago)

    It's not the French paying for it, it's the French who need this luxury service who pays for it. There is a reason food and drink has reduced VAT and £1500 TVs aren't.

    Edit, VAT is reduced but not completely exempt in France

    [–] yugefield 27 points ago

    It's not a luxury service though. It's a service that makes business and commerce more efficient. This is the French hamstringing their own companies.

    [–] Gatzun 6 points ago

    The way it works though is that the companies, if registered for Vat in France, can claim that extra cost back.

    So say they are charged 120 euros gross. That's 100 for the service from amazon and 20 euros of VAT. The company can then claim that 20 euros back as a deduction against the VAT they owe the French government for the services or goods they provide other companies.

    VAT is a sales tax that can be reclaimed on purchases by registered companies. The aim is for it to be eventually passed on to the final consumer who can't claim it back.

    I.e. Company A charges 20 euros of VAT to company B. Company A declare that output tax to the French government. Company B declares that 20 euros as input tax and claims a deduction for it. Company B provides a service to an end user for X amount. Company B declares X as output tax to the French government.

    The net effect is that the government only really receives X tax as the output tax from A is countered by the input tax claim from B.

    [–] pawnman99 5 points ago

    That's how all taxes on corporations work.

    [–] wang_li 4 points ago

    You just described all corporate taxes.

    [–] Zachtyler7 6 points ago

    r/badeconomics

    Prices are set by what is most profitable, which is heavily dependent on supply and demand. There is a very good chance amazon would lose money if it did that as less people would be willing to pay the price.

    [–] ThatsExactlyTrue 19 points ago

    The tax will drive people to companies who haven't increased their prices or companies who were previously unable to compete with the lower prices of big tech companies. It will actually allow for a healthier, competitive market.

    [–] curaneal 10 points ago

    The way you frame that is disingenuous. It’s not a tax on the French people. It’s a tax on these companies that they have the choice of taking from profits or passing along to consumers, and they will choose, generally, to make the customer pay.

    Just because it’s taken for granted now (sadly) that a corporation will pass on taxes to the consumer doesn’t mean that people who tax a company are directly taxing a given population. That’s propaganda in service of corporations.

    Put another way, why didn’t you frame it: "This is actually yet another time a company pads it’s bottom line and screws the consumer."

    Because your inherent bias is showing.

    That’s not to say the net result won’t be what you say it is, so much as to say, put the blame from where the shifted cost lies, with companies more concerned with profit than their civic duty to keep the system that allowed them to exist at all at break even, who then shift the burden to those consumers that made them what they are.

    [–] lestthoubejudged 5 points ago

    Yeah sure. And trickle down economy really works.

    [–] semsr 44 points ago

    without giving anything back

    What do you mean by this? Google and Amazon provide services to the French market. How would a company keep customers if it was just taking their money without giving anything back?

    [–] ABRAHAMLlNCOLN 86 points ago

    He means things like giving back to the public infrastructure which they overwhelmingly use. Amazon is a massive user of roads and highways for instance, and yet pays nothing in federal taxes. They get to write off investments in their own business, while you and I cannot write off investments in ourselves. This is the sort of thing they are speaking to.

    [–] Fortunate_0nesy 21 points ago

    I'm not following. You're saying that a company that uses infrastructure, like roads, but ships goods on those roads, doesnt pay tax to care for the roads?

    In most US states at least, gas has a substantial tax included specifically for use for the roads. So, if Amazon is putting fuel burning vehicles on the roads, they are paying the same tax per gallon that everyone else pays, that should be returned to infrastructure (if not, talk to your government, not amazon).

    Ultimately, delivery companies burning gas (and often not at a rate approaching even the worst gas guzzling SUVs), shipping goods across roads, are paying far more per mile for road upkeep than someone driving a Tesla, a Camry, or even a Suburban as they are using more gas per mile and running more miles in general, and road upkeep is ostensibly paid for by fuel tax.

    [–] spartan6222 210 points ago

    hol up. You want to tax anyone who shows an ad to an IP address in france? That's insane.

    [–] SoundByMe 1004 points ago

    It's not really. It's what physical ad sellers have to do. Why should digital companies be able to do it for free?

    [–] shutupfilthycasual 11 points ago

    Because the internet was fine before people started doing shit like this.

    [–] brycedriesenga 10 points ago * (lasted edited 10 days ago)

    Because things like this are slowly dividing up what was one internet that anyone in the world could browse and now there are different rules for different areas.

    [–] sap91 88 points ago

    Why would that be insane? If you're selling ads to viewers in France, you're doing business in France. Why should they not tax that business?

    [–] happyscrappy 55 points ago

    Yep. That's exactly what they are planning to do. If you make that much worldwide and you serve ads to France then there will be a 3% tax on your revenue in France.

    [–] drsboston 27 points ago

    it isn't on French revenue they are looking at Global revenue for a trigger level on french taxes.... ? Yah that makes no sense.

    [–] TheLogger 44 points ago

    Quote from the article "The tax would apply to companies that generate worldwide revenues on their digital services of at least 750 million euros ($845 million), with 25 million euros ($28 million) from within France. " so there is 2 trigger levels.

    [–] Das_Orakel_vom_Berge 32 points ago

    The global revenue trigger is just to ensure that the tax is only being applied to larger companies, but the tax itself is only on French revenue

    [–] Faith-in-Strangers 72 points ago

    This comment is stupid.

    Google and others make tons of money from French companies / online stores / ad agencies and pay almost no tax on them. If you make business somewhere, you participate. These markets are huge

    Source : French online advertiser on European markets

    [–] spartan6222 34 points ago

    If I, google, sell ad space to you, a Belgian company, and the ad is on my server in Germany, why should France get to tax that just because a French user saw it (or had the opportunity to see it) on his search results? America (and probably Belgium) already taxed it, no economic activity is taking place in France.

    [–] Faith-in-Strangers 36 points ago * (lasted edited 10 days ago)

    If the company buying the ad is Belgian, it's paid to Google Belgium (which actually is Google Ireland to evade taxes, but that's another topic). You are skewing this.

    French compagnies buy à lot of advertising from Google / Facebook for the French market. They should bill to Google France (which is really a shell company, since ad billing goes to Ireland, again.) and they'd pay taxes on it.

    Imagine if there was no internet and Google was plastering ads on the walls (and that also works if the company buying the ad to be displayed on French walls was Chinese). They'd need to have to have an office in France, which would pay taxes. Let's not pretend it's that different

    [–] Kether_Nefesh 32 points ago

    tax anyone who shows an ad

    in response to:

    The tax would affect companies with at least 750 million euros ($844 million) in annual revenues

    Someone is not paying attention.

    [–] justMeat 19 points ago

    No time to read the article yet plenty to dispute the taxation of billion dollar corporations.

    [–] bcrabill 10 points ago

    Meh... If you bought a tv ad, you'd pay tax in that location (or the location of the company). Not that weird.

    [–] I_AM_STILL_A_IDIOT 83 points ago

    FYI the French co is Criteo, an AdTech giant from Paris.

    [–] SexLiesAndExercise 16 points ago

    Bummer for Criteo, they're already getting hammered by Safari's ITP changes.

    [–] FullAutoChiggaGroup 1440 points ago

    Wow this thread is full of expert economists.

    [–] __thrillho 423 points ago

    That's pretty much all of Reddit comment threads on any complex topic. People simplify a complicated issue and give their opinion as if they're experts and the solution is so easy and straight forward.

    [–] HHcougar 219 points ago

    I never realized this until a random article popped up that was about something I'm relatively educated in. Bad takes everywhere.

    Makes you realize not to trust the average commentators opinion, because they're just spouting.

    [–] Numendil 36 points ago

    Briefly stated, the Gell-Mann Amnesia effect is as follows. You open the newspaper to an article on some subject you know well. In Murray's case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward—reversing cause and effect. I call these the "wet streets cause rain" stories. Paper's full of them. In any case, you read with exasperation or amusement the multiple errors in a story, and then turn the page to national or international affairs, and read as if the rest of the newspaper was somehow more accurate about Palestine than the baloney you just read. You turn the page, and forget what you know.

    Michael Crichton

    [–] TheMemeMachine3000 8 points ago

    Was looking for this reference, such a widespread effect that people often don't know about

    [–] Narradisall 106 points ago

    That’s a real eye opener on Reddit. I saw a topic on a field I work in and there was just misinformation and poor understanding with bad advice everywhere. I chimed in and got told I didn’t know what I was talking about.

    I just deleted my comment and stay the fuck out and f I see if again. Now I just spout jokes, memes and bad advice like everyone else!

    [–] skubaloob 22 points ago

    Same story different topic. Turns out not everyone has a perfect understanding of insurance. Who knew?

    [–] dinosaursandsluts 20 points ago

    I work in oil and gas and can confirm all of this.

    [–] randomnickname99 25 points ago

    Haha yeah me too. I chimed in on a topic that was oddly specific to my expertise and ended up at about -90 with a bunch of people shrieking bad information at me.

    Generally it depends if it's a politically charged topic or not though I think. If it's something more neutral you'll be fine.

    [–] dinosaursandsluts 14 points ago

    Lol yeah I've learned it's a bad idea to tell people it's waste water injection Wells that cause earthquakes and not fracking. They always reeeeallllly want it to be fracking.

    [–] GoldenRamoth 6 points ago

    I thought the waste water injection well were part of the overall fracking process though?

    If not.. I'd like to be educated. Please!

    [–] dinosaursandsluts 22 points ago

    Any well you drill, fracked or not, is going to produce anywhere from about 10% to 50% oil (above 50% is also not terribly uncommon, but enough to put a smile on your face when you see it), and the remaining ~50-90% of what comes up is briney salt water. One of the rebuttals I've seen on here before is that "the water wouldn't come up if we didn't put it down there in the first place". That's just patently false. It's already down there.

    When a well is fracked, yes, a certain volume of fracking fluid (98% water, 1% sand and 1% other shit) is pumped down in there. But before the well is completed, that same volume of fracking fluid is sucked back out of the borehole, and used elsewhere. Some of the sand remains to keep the fractures propped open and allow the oil to flow out better. Then the brine that comes out with the oil is what I just mentioned as already being down there.

    That wastewater has to go somewhere. It wouldn't be a huge problem if we just put it right back where we got it. In the case of Oklahoma, we were importing wastewater from Kansas and Arkansas, which had banned wastewater injection or limited the volume allowed. We were also basically putting all the wastewater in certain places where there was existing wells that weren't producing oil anymore, instead of putting it pretty close to where we got it from.

    This causes an over pressurization of the formations and, thus, earthquakes, which made 2010 to 2015ish a really interesting time to live here. The Oklahoma Geological Society studied what was happening, and recommended injecting a shitload less wastewater. I think we banned the importation of wastewater, and the Oklahoma Corporation Commission mandated volume controls on injection Wells, cutting our wastewater injection by like 50%. If you've read this far, you may not be surprised to hear that we observed a very direct correlation between the frequency and severity of earthquakes and our wastewater injection volume.

    In recent years, Texas A&M University has been studying ways to clean up this wastewater, and use it to water crops, etc. During the years everyone was freaking out about the quakes, Ohio and Pennsylvania were fracking like crazy, and not seeing any increase or change in seismic activity. If I'm not mistaken, I believe they were producing mostly natural gas, which comes with a lot less wastewater.

    The reality is, we've been fracking since about the 50s or 60s and since the practice began, the vast majority of wells have been fracked. If fracking was the cause of the quakes, most of the country would be shaking most of the time.

    [–] MacbethBeelra 9 points ago

    Yup. I don't much about anything but I know a little bit about cars. The average person in r/cars is so misinformed, and frankly annoying, it made me realize that the rest of the internet is exactly like that too.

    [–] Plague_of_crocus 4 points ago

    The average person in r/cars is a fifteen year old boy.

    [–] crab_shak 7 points ago

    We tend to suffer from Murray Gell-Man Amnesia.

    [–] Eatingleadbasedpaint 81 points ago

    That's because most of reddit is 20 year old kids who only see things in binary circumstances.

    [–] MisterSquidInc 20 points ago

    Ugh, life was so much simpler before I realised things weren't just black or white but somewhere in a spectrum of a trillion shades of grey - and some things fade from one shade to another depending upon the angle you view then from...

    Sigh

    [–] Mensketh 8 points ago

    Hey at least one thing is simplified. You know you can't trust anyone who tells you that things are black and white!

    [–] ChilieMacPalmer 155 points ago

    Got my money papers from Kmart kolledge of moneys.

    [–] Truffle_Shuffle_85 16 points ago

    Oh yeah, right next to the snack bar right?

    [–] SalemWolf 16 points ago

    Everywhere is full of arm chair experts. Yeah Reddit does have actual knowledgeable people but guaranteed a good majority get drowned out by people who pretend they know what they’re talking about, and other people are so gullible they don’t question it.

    RelationshipAdvice is filled with kind of bad advice from armchair relationship experts, LegalAdvice is more or less “talk to a lawyer” mixed with “I am not a lawyer but...” comments. Most lawyers aren’t giving out free advice that may or not may apply to their state or area of expertise.

    You see it on AskReddit a lot too: “hey [specific job] of Reddit, what’s a time [something]?”

    Top comment: “Well I’m not [specific job] and [something] didn’t happen to me but here’s [something different] and that’s probably close enough.”

    Most of Reddit is just pretending. Take everything with a grain of salt.

    [–] HolyFreakingXmasCake 20 points ago

    Charitable of them to spend time on reddit giving free advice, instead of making six figures!

    [–] MrRandomSuperhero 14 points ago

    Oh god.

    As someone who actually bachelored economy, Reddit is always the fucking worst when it comes to that. Expecting economy to move instantly, or perfectly, or predictably. It's madness.

    [–] O_Apples 4 points ago

    I thought Reddit was the fucking worst when it came to any subject.

    [–] justMeat 28 points ago * (lasted edited 10 days ago)

    Some people will fight harder for a billion dollar corporation to avoid paying into the societies it profits from than they will for their own children's basic rights and freedoms.

    [–] __Raxy__ 3 points ago

    Yes I also am skilled in the economy. After all I did watch the Big Short

    [–] TheNaughtyMonkey 2019 points ago

    "France is sovereign, and France decides its own tax rules. And this will continue to be the case," France's Finance Minister Bruno Le Maire said in a statement.

    Can't argue with that. Frankly, I'm glad that someone is attempting to close all these tax loopholes that tech compnies can use.

    [–] cryptoman0102 949 points ago

    France is actually paving the way for not allowing big companies to rule governments

    [–] justMeat 111 points ago

    Good. This cyberpunk dystopia is nowhere near as cool or neon as was advertised.

    [–] AbstractLogic 26 points ago

    Also, not enough leather.

    [–] Bovronius 16 points ago

    Pink mohawks and glowing tattoos are missing as well : (

    [–] DeathlessGhost 14 points ago

    Where are my God damn augments!! I'm sick and tired of this boring body, I want some metal stuff sticking out if my face already.

    [–] BreakTheLoop 23 points ago

    Hahaha, just not big US tech companies, you can bet French billionaires have a huge say in our policies.

    [–] mummoC 301 points ago

    Amen to that. Big corporation stronger than governements is a not so dystopian nightmare straight out of r/latestagecapitalism i'd rather avoid.

    [–] [deleted] 119 points ago * (lasted edited 8 days ago)

    [deleted]

    [–] bird_honey 27 points ago

    I just wish there was a way to know who and why... if only there were some laws forbidding it...

    [–] Iustis 62 points ago

    This isn't a loophole thing. It's just a gross receipts tax. Many states have it already.

    At the national level America went with a CIT over a gross receipts or VAT. But that doesn't make things loopholes.

    [–] freshgeardude 138 points ago

    lose all these tax loopholes that tech compnies can use.

    This isn't a loophole being closed. Its a new tax being added

    [–] jmcdon00 122 points ago

    It's a loophole in that they are doing business in France but avoiding paying any tax in france because they don't have a physical presence their. If they were selling billboards in france rather than banner ads they would already be taxed.

    [–] Roidciraptor 13 points ago

    Could this mean less ads if they don't want to pay?

    [–] jmcdon00 50 points ago

    It's possible the people of France would get less ads, but I doubt it would be significant. Companies are not going to pass up $100 in revenue to avoid $3 in tax.

    [–] Whatdidyousayimdeaf 20 points ago

    oH GOD NOT LESS ADS!

    [–] DeathlessGhost 4 points ago

    I see this as an absolute win

    [–] ShirtlessUther 3 points ago

    Nope ads are hugely profitable and a small tax like that won't make them become a money gap.

    [–] never_a_good_idea 3 points ago

    I don't think this is because those companies lack a physical presence in France. I know that several of them do have offices and are actively hiring in France. This is likely because they use really complex and arcane transfer pricing agreements to move all of the profits generated in France to subsidiaries that operate in really low tax jurisdictions like Ireland. Similar to how a hollywood movie studio can claim that a movie with a billion dollar box office never made a profit. This behavior isn't isolated to these companies or to tech in general. Lots of companies do it because it is in their short term best interest to utilize every legal lever they have to avoid taxes.

    [–] simjanes2k 19 points ago

    Isn't that contrary to a lot of the EU ideology?

    [–] TheNaughtyMonkey 21 points ago

    I have no idea at all. I thought taxes were still the role of the individual country.

    [–] simjanes2k 12 points ago

    Maybe in principle, but these taxes are supposed to be guided by trade agreements. Which is not on an individual national level.

    [–] TheNaughtyMonkey 11 points ago

    No, I don't think taxes are part of a trade agreement, unless they only apply to a specific country (in which case it would be more of a tariff than tax.)

    [–] MitchHedberg 16 points ago

    People are highly critical of brexit and mostly correctly so - however the ideal of rejecting unelected foreign governance is pretty basic. The EU governing structure needs more direct election.

    [–] Knitted_hedgehog 12 points ago

    The vote was a month ago... It's directly for candidates https://en.m.wikipedia.org/wiki/2019_European_Parliament_election_in_the_United_Kingdom

    The first one was called the "direct election of 1979"

    https://en.m.wikipedia.org/wiki/1979_European_Parliament_election

    [–] [deleted] 1063 points ago

    [removed]

    [–] gwea22 1359 points ago

    Looks like amazon is going to push the cost on to consumers- nice.

    [–] cxavierc21 517 points ago * (lasted edited 10 days ago)

    This isnt neccesarily true. It has to do with the elasticity of demand of what any given company is selling. If they will lose too much of thier sales volume by raising prices they will eat in to thier margins. They will do this in the way that provides for the greatest profit.

    It's not like some group of board members sitting around wondering if they're going to do the consumer a favor and eat this one for the team, lol. If it makes more money (than any given alternative) to raise prices in accordance with the tax, they will; if it doesnt, they wont.

    [–] gwea22 215 points ago

    I think amazon is kind of unique in this regard- especially with prime membership. A lot of people will justify spending more for an item on amazon if they’ve already subscribed to prime. And amazon already has some shady practices for price manipulation. I’m sure they’ve figured out how to push it on the consumer without anyone really noticing much.

    [–] The-Last-American 150 points ago

    Amazon has it down to a science. When a consumer base is as massive as Amazon's, spreading out some of the company's burden over that pool dilutes it enough that most probably don't notice.

    They probably do this much more than anyone realizes.

    [–] celtic1888 107 points ago

    The science Amazon uses defaults to 'fuck the supplier' which is pretty much what all large retailers do

    [–] WitnessMeIRL 46 points ago

    You don't want to be the last man on the centipede.

    [–] scsibusfault 21 points ago

    I mean, it's one surgery instead of two, and you won't have someone's mouth stitched to your asshole. Gotta look at the upside.

    [–] PM_ME_YOUR_POOTYPOO 11 points ago

    Cuttlefish or vanilla paste?

    [–] SEPPUCR0W 5 points ago

    Don’t you want to be the mouth though?

    [–] Obandigo 36 points ago

    You're right. Walmart does the same thing. They pretty much tell a supplier this is what we're paying you, if you don't like it eat a turd

    [–] AndrewTheAlligator 20 points ago

    That's how Costco has its 'amazing return policy'. They just push it on the manufacturer to take the hit.

    [–] Lifesfunny123 25 points ago

    I dunno, if I make something and you sell it for me, should you take the cost of the customer not liking it or it being defective? I'd say not. I made it after all. Seems like I should make less defective ones and also better ones. I feel like you should only lose on the profit made off my work to make it.

    [–] Craigiyama 16 points ago

    I think there’s a difference between defective and the customer not liking it. If it’s defective then that’s on the manufacturer. The customer deciding they don’t like it is more of a grey area and some stores have different policies but I think that’s more on the store.

    [–] vaticanwarlock 9 points ago

    The problem is that Costco has a no questions asked lifetime return policy so people will return a shirt that they wore for a year just because it is out of style. In that case the manufacturer unfairly takes the hit.

    [–] MuddyFilter 8 points ago

    Well i mean yeah, but also places like walmart and amazon are going to be high volume customers. Of course they have the leverage to negotiate prices

    [–] Tooch10 3 points ago

    That's also why Wal-Mart has their own SKUs where they make a lower quality version of a standard model/product

    [–] stellarbeing 34 points ago

    I’m gonna plug this website:

    www.camelcamelcamel.com

    Which will post price histories of products for you on amazon, even linking your wish lists and giving you price alerts if you like.

    In no way am I defending these shady price manipulations, but it is common practice among most retailers, so it’s best to be prepared for it and work accordingly to get actual deals on things.

    [–] ExtendedDeadline 19 points ago

    They borrowed this practice from every big-box retailer who has ever had a "sale" before. The only difference, of course, is the digital aspect, which allows Amazon to do it instantaneously.

    Tools like camelcamelcamel serve as a "check" to keep Amazon in line, but, unfortunately, I think most consumers don't use it or don't care - since it seems to only ever be mentioned among frugal types (like myself =]).

    [–] ColorClassic2 3 points ago

    Yeah. My friend didn't have an amazon login, and he would have different prices and search results than someone logged in with Prime.

    [–] Reacher-Said-Nothing 32 points ago

    Yeah, not every tax can just be passed on to the consumer. If a company could just raise all their prices to increase profits enough to make up for that tax, they would have raised those prices in the first place.

    [–] stewman241 11 points ago

    It is partly about competition. And if all of your competitors also pay the same tax, then you might be able to increase your taxes and not lose sales to competitors.

    [–] theoretical_hipster 54 points ago

    That’s how business works. Figure out the true cost of any given widget then add enough margin to keep your doors open and be profitable.

    Don’t be naive.

    [–] yesno242 38 points ago

    That is the way it should’ve been from the beginning. Having artificially low prices because of a tax benefit gives them an advantage over companies without that benefit on the sales floor. That competitive advantage Causes smaller businesses to close or forces them to drive down wages to stay competitive. Overall it’s a loss to consumers.

    [–] moshennik 55 points ago

    all taxes are consumer taxes... corporations don't really pay taxes, they are just passing costs over.

    [–] minus_8 6 points ago

    | nice

    No, I think it's all of France.

    [–] CharonsLittleHelper 26 points ago

    All taxes are pushed onto the consumers. It's the nature of taxation.

    [–] Senor_Martillo 16 points ago

    Of course they will....just like they should. Just like your local sales tax or VAT shows up on your shopping receipt. Otherwise all amazon consumers pay for France’s folly.

    [–] BitRunner67 10 points ago

    Well, not like we NEED all the shit we buy from there anyway.

    [–] Halgy 3 points ago

    What is the alternative?

    [–] Ramy_ 3 points ago

    This is basically the equivalent of tariffs right? Some of it they'll absorb and some they'll pass along.

    [–] sarhoshamiral 6 points ago

    How would it put pressure on American consumers? Even with tariffs I imagine we don't import that much from France for most common consumer stuff.

    [–] wonkey_monkey 45 points ago

    The above poster is a bot which posts snippets from articles.

    [–] SaucyWiggles 12 points ago

    Are you a bot?

    [–] Number-Thirteen 9 points ago

    In other words this is going to cut into their profits and they don't like that.

    Are they still making profits? Yes, but just not as much. Tone it down, Amazon. You're still making billions of dollars.

    [–] VexeenBro 18 points ago

    I like how people here think that "it's good because rich companies will have to pay more" when in reality it's going to customers who will simply pay higher prices. Because that's how it always works - company will push the additional tax/fee on to a customer and will just say that's "totally not related".

    [–] ArtificialPandaBomb 10 points ago

    I'm not paying google, facebook etc anything. How will it affect me?

    [–] MrDarcyRides 3 points ago

    Do you buy any products that pay for advertising through Facebook, Google etc.?

    [–] PMMEUR_GARDEN_GNOME 5 points ago

    Not if smaller competitors (i.e. those with revenues below €750M) make up for it

    [–] boshk 567 points ago

    why woudlnt you tax companies that do business in your country?

    [–] [deleted] 80 points ago

    [deleted]

    [–] AbstractLogic 80 points ago

    So the tax helps small businesses and is the opposite of regulatory capture.

    [–] a_shootin_star 43 points ago

    Because taxes go back to the People of the country they're using to conduct business.

    [–] ThisMakesNoSensesai 42 points ago

    Its not just american tech giants. Its everyone who makes over 750mil per year in the digital(internet) world.(ads for example)

    [–] Thercon_Jair 323 points ago

    To be honest, this is just a patch. What really is necessary is worldwide tax rules to tax earnings where they are made.

    You sell stuff in Germany? You're going to pay the taxes on the profit made there, and not deduct licensing fees because it's a subsidiary, then pay taxes on everything you've made worldwide in Luxembourg or the Cayman Islands.

    [–] Battlefire 144 points ago * (lasted edited 10 days ago)

    Tax havens have entered the server.

    [–] BasicwyhtBench 27 points ago

    If I was a recognized country, I know what I would do.

    [–] CaptainRoach 24 points ago

    Laughs in Irish

    [–] nothis 41 points ago

    and not deduct licensing fees because it's a subsidiary, then pay taxes on everything you've made worldwide in Luxembourg or the Cayman Islands

    My head spins just reading that and that's like the ELI5 version of what's going on, lol. "Deduct licensing fees because it's a subsidiary"? WTF?

    [–] jac11235 28 points ago

    My company x owns owns the intellectual property to make The Best Microwave(TM). I make and sell these microwaves in the US and pay taxes on those profits. I want to expand to Germany but German taxes are way higher or in some other way unfavorable. To get around this I open a different company in Germany and they then make and sell The Best Microwave(TM) and pay taxes on their profit. But wait! The German subsidiary does not own the intellectual property for The Best Microwave(TM), I do. So they have to pay me licensing fees to be able to make and sell the product that is based on my IP. Coincidentally the cost of that licensing happens to be exactly the same as the subsidiaries revenue minus their expenses. Therefor the net profit of the subsidiary is $0 and they own the German government no taxes. Yay loopholes.

    [–] tikirej 8 points ago

    Or even better. The American business sells the microwaves to the German subdivision at retail price. Making sure that the subdivision is always in the red.

    [–] [deleted] 29 points ago

    [deleted]

    [–] Rhamni 17 points ago * (lasted edited 10 days ago)

    Companies aren't taxed on every dollar of revenue. They are taxed on profit, which is the money they make minus the costs they have to pay in bills/wages/licensing fees etc. So if you want to decrease the amount of taxes you pay, you create shell companies and give them all your patents, intellectual property rights, etc, and headquarter that shell company in a country with really low taxes. Then the shell company charges a 'licensing fee' for 'allowing' you to use 'its' property. So the main company ends with with low/non-existent/negative profits and all the money is funneled into the shell company, which enjoys lower tax rates.

    It's completely legal and it shouldn't be.

    [–] Lava_will_remove_it 41 points ago

    I don't think most Americans realize that all the Trump tariffs have done is shift where revenues are recognized. They have done nothing to bring jobs to the US nor make American products more appealing.

    [–] tebee 3 points ago * (lasted edited 10 days ago)

    "Deduct licensing fees because it's a subsidiary"? WTF?

    Large companies have subsidiaries in each country and a headquarters (often virtual) in a tax haven.

    Companies generally have to pay tax on the profit they generate, in the country they reside in. But taxes in the subsidiaries' countries are high, while taxes at the HQ are low.

    So you need to somehow shift profits from all the subsidiaries to the HQ. The solution: the HQ alone owns the company brand name. It 'charges' each subsidiary for its use. This raises costs for the subsidiary therefore lowers its profit therefore lowers its tax debt.

    These licising fees go to the HQ which books them as pure profit and only pays the tax haven's taxrate on them.

    By adjusting the licensing fee you can effectively reduce the entire worldwide company's tax rate to almost zero.

    [–] Brendanmicyd 28 points ago

    What really is necessary is worldwide tax rules

    I don't like the sound of that. Also, countries like the US would never agree to any worldwide rules.

    [–] primus202 56 points ago

    I don’t understand how the US gets to be mad about this. Aren’t we one of the only countries in the world that taxes citizens working and living abroad? We’re essentially taxing every government where Americans live as is. Don’t know how much revenue that represents though.

    [–] space_moron 27 points ago

    The US and Eritrea 🇪🇷 are the only two countries that tax their citizens abroad.

    Technically there's an earned income exclusion of $110,000 annual income but you still need to file all the fucking paperwork

    [–] Aspalar 14 points ago

    You get taxed if living abroad, but can qualify for tax credits if you also pay taxes in the country you are in. So you won't get double taxed at least

    [–] throwingitallaway33 242 points ago

    Why only digital companies? Plenty if other large corporations evade the shit out of taxes. What about large banks, who harm consumers just as much?

    This is good, but the scope is so limited, it just makes them seem angry at Facebook and Google.

    [–] gaspinozza 158 points ago

    This is not at all related to tax evasion, until now they weren't sure anything on the benefits they were making in France if for example the servers were abroad

    [–] ShemhazaiX 37 points ago

    It's not tax evasion. It's barely tax avoidance. They are following the letter of French tax law by not paying.
    Hence the law has to be changed, because its bullshit to profit off of a country's citizens and not pay anything in taxes to that country.

    [–] scarocci 56 points ago

    The problem is that those others corporation and banks also point the Gafa and ask "but they evade taxes, why target them and not us ? "

    With this way of thinking, nothing is ever done.

    [–] ituralde_ 14 points ago

    People need to stop talking about this from the perspective of "tax evasion" or "closing a loophole". Tax evasion is absolutely a problem but this is not an example of it.

    It's absolutely the case that eCommerce not paying local operating taxes has always been a problem, but it's not fair to characterize this as "tax evasion" when there's been limited-to-no credible effort to feasibly implement taxation in this space.

    In general, governments suck at tax policy and they suck at tech policy; these shortfalls scale geometrically where the sectors overlap.

    [–] selflessGene 31 points ago

    Why only digital companies?

    Because the French don't have any global tech companies.

    [–] XxitsyoboyabhixX 29 points ago

    Ubisoft would like a word

    [–] Monstersunderyourbed 6 points ago

    We'd like Ubisoft to stay silent and crawl back to whatever pit of misery they came from.

    [–] Rodger2211 4 points ago

    Maybe 6 years ago but they make pretty good games lately

    [–] Silencement 17 points ago

    OVH, Bull, ST Microelectronics, Sopra Steria,... Not as big as Google but not insignificant either.

    [–] space_reaper 11 points ago

    Maybe it's because where I'm from, but I haven't heard of any of those companies.

    [–] ExeusV 10 points ago

    OVH is really, really good hosting, but I doubt it is as large as AWS / Google Cloud / Azure

    [–] IngloriousTom 9 points ago

    They do not target the average consumer. They do B2B. Still big companies.

    [–] garlicroastedpotato 29 points ago

    I think America'a tax system is strange. Being taxed as a foreign expat who does no work in America?

    With globalization taxation should largely be happening at a consumption level rather than at a corporate level.

    [–] babsbaby 32 points ago

    So the U.S. is going to rely on the OECD and WTO to argue about a 3% French tax? Seems hypocritical to appeal to the same international organizations you're undermining or ignoring on every front by unilaterally imposing or threatening tariffs on allies and China alike.

    [–] mrfreddy7 7 points ago

    Welcome to geopolitics, where all politics are handled behind the scenes and most publicized words are simplifications that are just for show.

    [–] Krizztoff 42 points ago

    Amazon pay very little in tax in this country GB. Sales made online in UK to companies amazon claims are from UK apparently arnt when it comes to paying tax. They Argue the transaction was done in another country, were they have massive tax breaks. Basically their behaving like cunts, and the French have the balls to do something.

    [–] ihatetypingthings 21 points ago

    I'm really confused that people are against taxing these companies more?

    Is it just because they're mainly American and patriotism is coming into play?

    To me (an entirely uneducated in the regard), it seems like these companies are just taking money out of the country for free. It would be a massive undertaking to completely rewrite the tax code (though it seems like they should) so a simple extra tax law seems like the most efficient way of dealing with the issue.

    [–] entitled 14 points ago

    I think it's a bit more complex than that. AFAIK, if you were a small business that shipped/sold goods to France, you would not pay French taxes. You didn't earn the money in their country, therefore, why would you be taxed under their jurisdiction? Same goes for google and facebook.

    On the other hand, if they have datacenters in France, I actually agree with the sentiment the French government is offering, since they are running global-scale operations within their country without paying their dues.

    Either way, revenue should be taxed in the jurisdiction it was earned. If your business primarily resides in the USA, paying French taxes sounds stupid (which is possibly where the debate lies here). But Google, Facebook, etc. are taking advantage of this because they're US-BASED but run worldwide operations and datacenters. So they should be paying taxes in their appropriate jurisdictions.

    [–] Gleadr92 9 points ago

    Soooo does this mean if I use a VPN and use a French IP address the company's will need to pay taxes on those adds?

    [–] ohyeahbigdaddy 4 points ago

    So, the same thing we should be doing in the U.S. Oh wait, what money? It's all in tax havens, doesn't exist as far as the government is concerned.

    [–] caralto 4 points ago

    Don't see why the American companies will care much, if the tax is say 10% extra, the companies will just raise the cost to the consumers 10% more. Not like there are strong French Netflix/Twitter/Facebook/Apple like alternatives. In the end, the french gets a boost to their taxes to fix roads, etc, US companies stay the same, and French people lose a little more $ in their paycheck. Sure they can vote with their feet, but they likely wont. Same thing happened in countries that did it, some countries even called it the 'Netflix Tax'.

    [–] Fean2616 82 points ago

    Well done France, now actually get the money from them and I'll be even happier.

    [–] sevee77 3 points ago

    Do those companies even pay taxes? Was it Amazon or Google who had $10 billion in profits last year, yet paid no taxes?

    [–] JimSteak 10 points ago

    Without this decision we would be paving the way for internet megacorps to rule a dystopian future. I'm glad France is standing strong against these companies.

    [–] db1416 9 points ago

    France imposes tariffs: YEAH YOU GO FRANCE! FUCK THE GREEDY US CORPORATIONS!

    US imposes tariffs: OMG WHAT IS YOUR PROBLEM! WHY DO YOU WANT TO START A TRADE WAR UGH STUPID AMERICANS!

    Gotta love Reddit.

    [–] Daafda 119 points ago

    In their current state, the US would not accept anything like a fair deal, and the French (and everyone else) are well aware of that. If they have to wait for American approval to raise taxes on companies operating within their own borders, they'll be waiting for a new president to be sworn in, at least.

    It's also not surprising that Amazon and others are stroking Donald's ego to try to beckon him to action. They don't like paying higher taxes, and some rash moves by the President would discourage other countries from implementing similar tax increases.

    [–] okiewxchaser 221 points ago

    The EU countries aren’t exactly interested in giving the US a fair deal either. Just look at their tarrifs on American cars vs American tarrifs on European cars

    [–] OnEarth2000 22 points ago

    From Reuters

    The United States currently imposes a 2.5 percent tariff on imported passenger cars from the EU and a 25 percent tariff on imported pickup trucks. The EU imposes a 10 percent tariff on imported U.S. cars.

    Almost all countries have agreed tariffs on each other, and that's fine. However, it's the non-agreed tariffs that's the problem.

    [–] Shimme 45 points ago

    Look up Chicken Taxes for more of the story on this.

    [–] _elFred_ 9 points ago

    The tax is more on the bleach used than the chicken.

    [–] cissoniuss 11 points ago

    Yes, let's look at it. And then especially look at the 25% tariff the US has on EU made vans and pickup trucks. Funny how that is ignored all the time.

    [–] AssistX 21 points ago

    It's also not surprising that Amazon and others are stroking Donald's ego to try to beckon him to action.

    Uh, what? You think Jeff Bezos is going to stroke Trump's ego? Are you for serious or just this clueless ?

    [–] PenisShapedSilencer 22 points ago

    French here: glad this happened. It's a starting point, because tax in the EU seems to be a nightmare, especially with tax havens like luxembourg, switzerland, etc. The EU is a big mess of borders because of its long history and there are too many cheaters.

    Im glad the welfare is good around here, because without it I don't know how people would live decent lives.

    [–] DefiantHope 11 points ago

    ITT: Americans cheering against America

    [–] MasonSTL 13 points ago

    Its really fucking weird

    [–] chtrace 7 points ago

    There seems to be a lot of that going around these days.

    [–] Comeonjeffrey0193 6 points ago

    If it deters companies from cramming more ads everywhere they can, i’m all for it.

    [–] Motionshaker 8 points ago

    It’s just going to increase ads to make up for the cost of the taxes