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A comment on Spanish authorities raid Google offices over tax. Parent comment

Re:Spanish authorities raid Google offices over tax by AnthonyMouse on Thursday June 30, 2016 @11:31AM (#12009221)
> It kind of is, though, isn't it? The online ad market is theoretically super efficient - if the market clearing price for an ad is $1, and then you add a 10% sales tax, it no longer makes sense to bid / pay $1 for that ad, knowing that you will be out of pocket $1.10. Instead you would bid about 90-91 cents, knowing that it would get marked up to $1 with tax. Net effect is that Google only makes 90 cents on that ad instead of a dollar, even though they aren't directly paying the tax.

Not if you have to bid against people in other jurisdictions for the same ad spaces. Then the people in the taxing jurisdiction have to bid the market price or lose the auction to someone in another place that doesn't impose the tax. In theory this could have a negative impact on ad prices, but it isn't going to be anything like the entire amount of the tax.

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Re:Spanish authorities raid Google offices over tax by defen on Thursday June 30, 2016 @12:23PM (#12009612)
Is there a reason that tax couldn't be imposed on the buyer, collected by Google at time of "sale" (click through by customer on ad), and remitted to the government, regardless of buyer origin? In other words, if I live in Montana (no sales tax) and I pay Google to display ads in Spain, I don't see a good reason to not have to pay Spain's "sales tax" (or whatever we're calling it) on those ads. I don't see why it should matter where the ad buyer lives, or where the ad clicker lives. I'm paying an entity in Spain, therefore the entity in Spain is taxed (and that higher cost ultimately flows back to me, the buyer). Or am I not really paying the Spanish entity when I buy those ads?
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Re:Spanish authorities raid Google offices over tax by erichocean on Thursday June 30, 2016 @03:28PM (#12011028)
> Or am I not really paying the Spanish entity when I buy those ads?

I'm pretty sure you pay the entity in the country that you are located in, so the Montana rancher is paying Google USA. Basically, you need a corporate presence in most places in order to _sell_ to people in those places. People in Spain pay Google Spain to place ads _as far as I understand it_—I'm not an expert on EU tax regulations.

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