I’ve had this very cynical idea for a while now. And that is, the only way we will get governments to stop this nonsense is if we democratize the extreme tax evasion... ahem ahem.. sorry, “smart tax planning” that these companies take advantage of.<p>Perfect opportunity for the Stripe Atlas team :-)<p>If you make it so an individual can pay $50 a month and they get this full double Dutch Irish sandwich shell company crap setup for them, and millions of citizens start to get incomes this way and pay their “lawful amount” rather than their fair share, then governments will start to clamp down.<p>Because right now we (private citizens who pay 25-40% in income taxes) are powerless in convincing our governments to do something about this travesty.<p>Thoughts? Remember, as these companies say with their weasel words “we pay the full taxes we owe!” So it would be legal.
Transfer pricing. It's the same for all big companies operating in Australia (and probably most other countries)<p>Of course there's nothing illegal about this and it's very difficult to really do something about it. The Australian Tax Office is struggling with this problem every day.
I think there is one solution to this, the G20/WTO type organisations need to come to an agreement that to trade with each other they have minimum tax rates. Countries are free to tax higher but if say these nations agree to say a minimum 25% type thing, then any country or company operating outside of this agreement is not welcome. I'd be inclined to do the same thing for personal tax. Otherwise we risk a race to the bottom for tax rates if we let cooperates continue this.<p>And this is 'capitalism' done right. Part of governments role is to create a 'level playing field' for business and stop a handful of larger/international companies having a non business advantage.<p>Further, I'd be inclined to go a bit nuclear with punishments and make rules that abuser pay 100x what they gained and the company assets/brand in which they did this for are seized and auctioned.<p>This later seems harsh but if we don't stop companies doing this we may see serious repercussions on government's ability to provide for society as we know it. Companies need to feel the risk is not worth the reward. I doubt this will happen, as an Australian our Prime Minister us known to have his hundreds of millions stashed in the Caymen Islands. What an example for the nation and likelyhood of crackdown seems low.
I agree that corporate tax avoidance is a problem and needs to be addressed on a global basis.<p>But as an Australian, I think we're missing the elephant in the room. We hold up these prominent brands like Nike and Apple, but ignore the fact that they are products designed and manufactured elsewhere. All we do in Australia is open the shipping container and distribute the goods to stores. Very little value is added in Australia. Regardless of tax changes, the tax revenue from simple distribution is always going to be low.<p>If we want to improve our corporate tax revenue, we need to <i>create things in Australia</i>, whether that's manufacturing, software, services or whatever.
This reminds me of how some pairs of Converse sneakers have a thin layer of felt on the bottom that rubs off, so that they're considered "slippers" at the time they're exported and not "sneakers" to get a cheaper tariff.