Re:G7: Rich nations back deal to tax multinationals
by zmk_ on Saturday June 05, 2021 @12:45PM
(#27406546)
They still would hire domestically and pay salaries that would be taxed.
Re:G7: Rich nations back deal to tax multinationals
by sbacic on Saturday June 05, 2021 @01:25PM
(#27406905)
They'd need to grow to a certain size first and even then, they could just hire remotely.
My hope is that these rules will only apply to large multinationals but somehow I doubt it - governments are unlikely to leave money on the table and will likely use this opportunity to expand the scope to include smaller businesses as well.
I see two things come out of this:
1. Companies selling their B2C services digitally will be paying both their sales (or VAT) AND their corporate income tax in countries where their customers are. This will be a benefit for countries with large markets and leave smaller countries where the companies are headquartered wondering what the value of these companies to their economies is.
2. A major problem for digital businesses will be the fixed costs of compliance. I suspect that a lot of side-projects and lifestyle businesses won't see the light of day on account of how expensive it will be to keep them running for years while they build up revenue.