
UK scores an own goal with its Digital Services Tax - nickstan
https://www.ekm.com/blog/uk-scores-an-own-goal-with-its-digital-services-tax-2
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fredley
This is an extremely opinionated article:

> People will always support charging more taxes, as long as it isn’t them
> paying.

I would happily pay more taxes, personally, in exchange for better social care
and schools, public services I do not use.

> So, next time you see a tax aimed at the “rich” or a company bigger than
> yourselves, remember it will eventually hit you along with everyone else.

This is extremely simplistic and troubling framing, and comes across as a
whine. I suspect this outcome was expected, and Her Majesty's Government can
sell this as a win to the electorate (look at us taxing the big tech!) while
keeping their donors happy. The number of people who do notice/care, and their
combined political clout is negligible, and that's the World we live in right
now.

~~~
logicchains
>I would happily pay more taxes, personally, in exchange for better social
care and schools, public services I do not use.

Do you regularly donate to charity then? In UK it's actually possible to
voluntarily pay extra tax, but doing that doesn't seem very popular:
[https://www.ft.com/content/4b3e6db0-e57a-11e7-8b99-0191e4537...](https://www.ft.com/content/4b3e6db0-e57a-11e7-8b99-0191e45377ec)

~~~
fredley
Yes, although charity is problematic: it means priorities are set by those
donating (and more by those donating more), rather than by need.

All private schools in the UK operate as charities, for example.
[https://en.wikipedia.org/wiki/Eton_College#Charitable_status...](https://en.wikipedia.org/wiki/Eton_College#Charitable_status_and_fees)

~~~
spzb
And it's further complicated by Gift Aid. Seems like a good idea on paper :
the charity receives your donation plus the amount of income tax you paid when
you earned the money you donated [1]. Looks like everyone wins except the tax
man and no-one like him anyway. Except what actually happens is that you're
taking tax away from things that it would have otherwise funded like schools
and hospitals. So when you Gift Aid your donation to the donkey sanctuary you
are essentially saying "I value these donkeys more than I value educating kids
or treating the sick". Maybe you really do think donkeys are more valuable
than kids and the sick but you're making an individual decision that harms the
collective population.

[1] [https://www.gov.uk/donating-to-charity/gift-
aid](https://www.gov.uk/donating-to-charity/gift-aid)

~~~
foogazi
Can someone gift the money to the donkey sanctuary without taking the tax
benefit, so as to not deprive the children, the sick and the military

It appears you are donation shaming - saying the government has a better idea
of what to do with tax money than an individual donor

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ocdtrekkie
The problem here is that it permits tech companies to pass the bill on. These
sorts of taxes need to account for the fact that the companies it's leveraged
on are monopolies, and can raise prices without issue.

They should've coupled this tax with a ban on raising their rates or passing
it on as an additional fee.

~~~
trentnix
You're trying to hold a river back with your outstretched arms. Taxes are
_always_ passed on to the consumer because they are a cost of doing business.
Raise taxes, you raise prices. Always.

Only competitive pressure and consumer discernment will drive down the price.

~~~
ocdtrekkie
And the problem is that Google, Apple, and Amazon face no competitive
pressure. (This is why monopolies are basically the ultimate loophole in
capitalist systems.) So short of breaking them up, governments need to
introduce price ceilings that begin to make up for the lack of competition.

~~~
trentnix
All three are protected by the government in various ways. Amazons entire
business was largely built by the government neglecting to enforce sales tax.
They had an 8.25% advantage, for many many years, over every brick and mortar
competitor in my area.

Where monopolies (or more precisely, market dominance by a single player)
exist, crony capitalism almost always exist.

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iso1210
He's internally inconsistent. He complains amazon etc will simply pass on the
cost, but he also complains that they don't have to pass on the cost of things
like VAT (which is odd, as my last AWS bill and the kindle book I bought both
had vat)

~~~
bhupy
That's because a VAT is charged directly, like a sales tax. It's its own line
item. It's technically the government charging a tariff on the purchase,
rather than the merchant passing on a cost via price increase, though in-
effect indistinguishable to your wallet.

~~~
iso1210
He seems to be arguing that his online competitors don't have to charge VAT,
then he says Amazon specifically charge VAT

I assume he has <£500m revenue, so won't be charging the "digitial services
tax", but he's complaining that large companies like Amazon do charge it (even
though they don't - they pay the tax, just like they pay tax on people they
employ, tax on fuel their delivery vehicles use, property based taxes on
warehouses and offices, and indeed other overheads like rent on offices -
unlike VAT they don't collect it on behalf of the government)

Amazon seem to be making a political statement on their invoices. They don't
have a line item of "London office tax" or other cost centres, only on this.
They must be annoyed - they can't charge people more (because they would
charge people more without that 2% extra -- they don't price their services
based on a fixed profit margin, but on the maximum price they think they can
charge before losing customers), so it must be hitting their bottom line
(however slightly).

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jjar
Can't seem to access this. Hug of death?

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mhh__
Corporation tax tax seems totally unfit for purpose, it just means small
companies pay tax and multinationals can dodge it. As a revenue raising effort
I think DST is superior.

The issue is that it's difficult to have a frank discussion about tax policy
in the UK, because a lot of people basically view tax as a way of sticking one
to the capitalists rather than actually doing good. We tax cigarettes to stop
people smoking, we tax businesses because why? Their employees pay tax, NI,
and their customers pay VAT. The public have a very naive view of business -
some business's are exploitative, yes, but the reason why potentially
unsavoury companies like Uber are doing well is because they are simply
superior to their competitors. I don't want my own moral standards applied to
every business transaction, let alone the Twitter mob.

~~~
TheOtherHobbes
We tax businesses because businesses benefit from public infrastructure -
health care, education, physical infrastructure - and they're expected to make
a contribution just like everyone else.

In fact the UK is very bad at taxing corporations. It subsidises low wages
with tax credits, which incentivise corporates to pay people poorly. London is
also one of the capitals for money laundering (including crime proceeds) and
offshore tax evasion - about to become even more so after Brexit.

So the world would be a better place if basic moral standards were applied to
all business transactions. Sadly they aren't, and that causes huge social and
political distortions, as well as inconveniencing smaller businesses at the
expense of large multinationals.

~~~
mhh__
As I said, businesses already pay tax and should not go untaxed but why
profits specifically? We have business rates for land, fuel duty for vehicles,
VAT for customers, NI contributions etc. We also have a basic form of carbon
tax for some businesses although it's not particularly fleshed out.

By moral standards I mean people second guessing consenting economic
transactions e.g. no one seems to ask people driving on Uber whether they want
to be employees or not, because the Tories don't care and some elements of the
Labour party view all employment as slavery of one kind or the other.

