Realist, not conformist analysis of the latest financial, business and political news

It’s Not Companies That Should Pay For Government

For all that Mazzucato whines Jobs really did start this off

A certain snigger here as the nations of the European Union tell the European Commission to stuff it over country by country reporting. All of which seems most sensible as the Trump Administration has dealt with the problem anyway in that last revision of the US tax code.

The complaint used to be that the large US tech companies weren’t paying tax anywhere. Now they do, in the US, so that’s all sorted then, isn’t it?

But we’ve still got an entire stupidity embedded in the not-thinking enough here:

It knows the EU is being played by a powerful group of US tech companies, from Google and Facebook to Microsoft and Oracle, that have grown quickly to be among the largest companies in the world without making much of a contribution towards the upkeep of the nations they sell to.

It’s not corporations who should be paying to keep governments. It’s the people who enjoy the benefits of those governments who should.

Sure, people who use the roads should be paying for the upkeep of the roads, that’s fair enough. Vehicle excise tax, fuel duty, that pays for that. The commercial courts? In England at least those wash their face from user fees. And so on. Equally, resource rents – Ricardian rents – should be taxed until the pips squeak and possibly more. No worries there, she’ll be right.

But to the general operating costs of the welfare state? Which is that bit left over after we’ve looked at all those user fees. Why? Why should the invention of search engines in California mean more money to be paid to single mother drug addicts in Workington? Sure, we can see that the people of Woking getting richer might be an argument for those in Workington getting a bung – we don;t have to agree, but we can see the argument – but that means taxing Woking, doesn’t it?

The basic argument that corporate profits should be paying for government doesn’t work that is. Especially as we get a nice chunk of tax from any of those within the jurisdiction who own these corporations.

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Mr Yan
Mr Yan
4 years ago

The monster (of government) has grown so big it now needs to devour ever more money to keep going.

Spike
Spike
4 years ago

Never mind who should pay taxes (they are not “contributions”). “We see a big pot of money, and we’re not getting any of it!” That is the only rationale here.

BlokeInTejas
BlokeInTejas
4 years ago
Reply to  Spike

Worse. “We see a big pot of money collected by foreigners – even worse, Americans – and we’re not getting any of it”….

Spike
Spike
4 years ago
Reply to  BlokeInTejas

Yes, that has got to sting.

Pat
Pat
4 years ago

Corporations don’t squawk as loud as other geese. So they’re the ones get plucked.

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