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by simonh 4719 days ago
It's not as simple as that. Suppose I run a company based in France employing 100 people and selling goods by mail order. All my operations are in France, so clearly I should pay my taxes in France. The only economic activity that occurs when I sell to someone in the UK is the postage delivery at the UK end. Your proposition is that I should pay UK taxes, but clearly I should definitely pay French taxes. So which do I pay, both? That's not a viable tax regime.

Trust me, if there was a simple way to fix this, it would be fixed.
2 comments
priteau 4719 days ago
It's definitively not as simple as your example. Both Amazon and Google have staff and infrastructure in UK and other European countries. Yet they channel all their profit to lower tax countries (Luxembourg for Amazon and Ireland for Google).

In the case of Amazon, when some sales staff is in the UK (evidence coming from whistleblowers, for instance http://www.guardian.co.uk/technology/2013/may/16/amazon-whis...), when warehouses are in the UK, and Luxembourg seems to be used only for signing the official contract, how is that not tax avoidance?

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simonh 4719 days ago
Of course what they're doing isn't as simple as my example. The point is you have to construct robust, enforceable and fair rules on an international basis that catch out Google et al on the one hand BUT also don't affect companies like the one I describe. The handwavey comments along the lines of "Just make them pay tax where they sell their stuff" like the one I relied to are less than helpful in this regard.
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Silhouette 4719 days ago
Suppose I run a company based in France employing 100 people and selling goods by mail order. All my operations are in France, so clearly I should pay my taxes in France.

I don't think anyone would have a problem with that. The problem is running your operations in France, supplying to customers in the UK, but declaring all of your profits in The Democratic People's Republic of South West Nowhere (corporation tax rate: 0.075%) where your corporate headquarters (head count: 1 lawyer (PT), 1 accountant, 3 board members who also sit on the board of 97 other businesses run by that lawyer and that accountant) is based.

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