Europe’s economy has been among the hardest hit due to economic shutdowns caused by the health crisis. Now is the right time to tax Google and other Big Tech companies like Facebook and Microsoft.
European Union states could have lost 5.4 billion euros in tax revenues from Google and Facebook between 2013 and 2015, according to a report of the EU lawmaker responsible for a corporate tax reform that could raise the online giants’ tax bill. As these companies have expanded during the pandemic, it only makes sense to tax them more with a digital tax on American companies.
Digital services taxes is a topic that has sparked division between a number of countries and the United States. But we have to do what is fair for the world and that means taxing monopolies in a way that benefits the global economy at large. Silicon Valley has abused its position of market dominance, at home and abroad.
It’s no secret how Google and others evade taxes. Digital multinationals “minimize the overall tax burden in the EU by routing all revenues to low-tax member states such as Ireland and Luxembourg. Tax loopholes are the spirit of how Silicon Valley has been built, with a complete lack of regulation while they grew without fair market competition.
It’s estimated the billionaire class will increase their wealth by about 60% during the pandemic. In the U.S. it’s already started. The pandemic is better than a war machine in the 21st century for the one percent to grow their wealth, to sky-rocket it actually.
China’s super rich are no exception. Europe, India and the developing world have to impose significant digital taxes on these companies, controlling elite and multinational companies. Otherwise their own innovation ecosystems pay the price.
Here’s how companies like Google conduct themselves. Google pays taxes worth up to 9 percent of its revenues outside the EU, but this ratio goes down to no more than 0.82 percent inside the EU. That’s not fair, and if France wants to stand up to Trump, it’s the right thing to do when the U.S. itself has failed to regulate its own companies and Silicon Valley.
America-first isn’t a good global economic policy. The White House believes the introduction of such levies is unfair and discriminates against American firms. Facebook and Google have powerful lobbyists in Washington who know who’s on the take.
France imposing a 3% digital tax isn’t a cause for concern. It’s a step in the direction of equality. America will be swept aside by greed is good capitalism by China if it keeps propping up its outdated duopolies. France will tax big digital businesses this year whether there is progress or not towards an international deal on a levy.
2020 really is a pivotal year for equality in BigTech. BigTech employees are more courageous in holding their leaders accountable.
France is doing the right thing and others will follow. Facebook’s taxes as a share of their revenues recorded outside the EU is between 28 percent and 34 percent, whereas in the EU this is a remarkably low ratio of 0.03 percent to 0.10 percent.
What kind of a world do we want to live in? Wealth inequality matters. The digital advertising model can’t just promote America above all other countries. It’s not right.
I would be ashamed to work at Facebook or Google in the 2020s. No amount of financial compensation would make me feel any better if the products I’m creating are being used for the exploitation of other businesses and unfair competition. The surveillance capitalism of Google and Facebook is out of control.
Asking them to pay their fair share of taxes isn’t a new paradigm, it’s just basic business rule of law. If the U.S. keeps this up, when push comes to shove, many countries will side with China in the bifurcation of the internet, due to the memory of Silicon Valley’s abuses.