Here's an example: A German company pays to advertise to a German consumer. It used to be that the money spent on that advertisement went to a German advertisement company, so that money would stay in the German economy, and the system would be sustainable, with money flowing around the system but not escaping. Now the ad money ends up in the Cayman Islands via Ireland and none of it is retained in Germany because the multinational advertising company has no/very few employees in Germany (no salaries/income tax) there's no VAT (because the ad sale is a B2B transaction) and there's no corporate taxes (because the ad company uses transfer pricing - e.g. licensing of IP that they can price arbitrarily - to shift all their profits to Ireland where they make them disappear in a puff of smoke). The end result is that money is being siphoned out of the German economy and into tax havens (so there's no return flow like there'd be if this was just normal trade with other active economies) making it harder and harder to sustain the German economy. There's a leak in the system when selling to consumers, and if it's left unchecked it'll slowly collapse the middle class and consumerism as we know it. I'm not sure if revenue tax is the best solution, but we need A solution. (or you know, we could just blame the foreigners and let the weakest parts of society fight over the jobs and shreds of wellfare state that are left, which seems to be the preferred solution these days). Mind you I'm not arguing against international trade (which increases competition and drives down prices) but against the unfair competitive advantage that multinational companies, especially digital ones, have over local companies by not needing to pay taxes at all. We need an even playing field, tax-wise, that's all.

> It used to be that the money spent on that advertisement went to a German advertisement company

It sounds to me like the problem is that the German economy failed to produce a Google competitor or, at least, a decent local German online advertising network that the German consumer would want to use. So, now they have a problem that they're trying to solve with taxation instead of innovation. This won't work, it just creates barriers to international trade in global world. It is 19th century economics.

> have over local companies by not needing to pay taxes at all

That is incorrect. They pay their taxes in their home countries. Why should they be penalized extra over local to Germany companies by having to pay double tax: once at home and once in that country?

You don't seem to understand how transfer pricing and tax havens work. These companies are not paying taxes on profits from most of their foreign sales in their home countries - the home corporation pays taxes on their domestic profits, and profits from those international subsidiaries that can't be channeled to tax havens (e.g. not from Europe) while all those profits that can make their way to tax havens do. Here's an article explaining how Apple does it: https://www.irishtimes.com/business/apple-s-cash-mountain-ho...

What that article doesn't make it clear is that the overseas cash was still subject to US taxation.

A few years ago, that taxation could be indefinitely deferred, but that's no longer the case. So calling it a tax haven is somewhat misleading if we're talking about US companies.

Digital services also use infrastructure, e.g. broadband, landlines, electricity etc., much of which is at least partially subsidised by taxes.

> broadband, landlines, electricity

all provided by companies, not the state. all paid for by consumers of these services already.

So you conveniently ignore funds for research, subsidies, as well as oversight and regulation.

Are you suggesting that all contracts with Google, Apple & co are not enforceable in France because they don't use the legal system?

> Are you seriously suggesting consumers of Google Ads (entities, worth on average, a few thousand euros) will go to court against Google (an 800bn dollar company)?

No, Google will sue them if they don't pay and the amount is large enough. That's a fairly trivial process in most legal systems. If you do use the legal system, that is. If you don't, you need to pray that your contractual partner keeps their end of the bargain because you cannot enforce the contract.

> Consumer contracts are enforceable due to reputational concerns and goodwill, not the legal system.

That's wrong. It's easy to enforce a contract, it happens all the time.

They still have offices in those countries, use infrastructure, benefit from education, especially higher education as well as the access to a fair and regulated market.

> use infrastructure, benefit from education, especially higher education

We established the infrastructure bit to not be true (how many times do you have to pay for the same thing?). Education: so why are students then paying tuition fees? Average UK student graduates with $45,000 debt... I am sure for 3% of revenue, Google can send their entire staff for 4 years of Ivy League college and have money leftover.

> a fair and regulated market

LOL. The EU is a fair market about as much as China.

UK ain't all of Europe! Mainland European countries heavily subsidies infrastructure such as Internet, Electricity, etc. They even invest billions in the construction of new power lines, and fibre-optic lines. For the latter Germany alone is spending 100 Billion Euros.

https://ec.europa.eu/digital-single-market/en/country-inform...

And what about giants such as Amazon that use the roads as well and don't pay any taxes?

And most European countries hardly have any tuition fees that could cover the costs of the University. Belgium tuition is ~1k per year, Netherlands its ~2k per year, Germany 0$, Austria 0$, Swiss ~1-2k, Spain <1k, Portugal <1k, Denmark,Sweden,Finland,Norway <1k. The UK is an outlier that tries to follow the american model of not investing into the future generations of a country. And thereby crippling a nation in the long run.

Finally, for a fair and sustainable market all businesses must abide by the same rules. Why do European companies pay taxes throughout europe on the profit they make in each countries to the respective country, but big American companies don't even pay 1%.....?

> We established the infrastructure bit to not be true

Questionable

> Education: so why are students then paying tuition fees?

When I went to uni in the EU I payed 280€ per semester which the majority of went to free public transportation, not tuition fees.

> Google can send their entire staff for 4 years of Ivy League college and have money leftover

And yet they don't, ever wonder why?