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Comment by ryanworl | Hacker News Reader

Revenue taxes on businesses that are effectively monopolies in their markets are... not smart. They will raise prices by exactly the amount of the tax and the only ones suffering are their customers who now pay 3% more for everything. I bet it would even be added as line item to every invoice “EU Revenue Tax, 3%”

I’m sure everyone will love it!

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But how does that work with a company like say Google? What prices are there to raise? It's more like they happened upon an incredible natural resource (the users' eyeballs connected to an unregulated digital network newly built by government funds) and are charging whatever price the market will bear. The tax is just a forced extraction of some of that margin, and I'm not sure how they can compensate for that. If anything, if they really are a monopoly and increasing prices could have got them more revenue presumably they would have done it already.

> If anything, if they really are a monopoly and increasing prices could have got them more revenue presumably they would have done it already.

A company cannot arbitrarily raise prices in isolation without risk of alienating customers. The difference here would be that both Google and its competitors would be subject to the same price hike.

actually that's not the case here, google and its competitors will only be subject to the same price hike if its competitors cross a certain gross revenue threshold, so biasing the market in favor of smaller players.

Advertisers in the EU markets could see a surcharge on their bill of 3% for the tax.

Advertisers who target european users, in and outside of EU need to pay.

Google has already passed on Australia’s 10% “overseas digital goods and services tax” as a line item on G Suite. My bill is 10% higher.

Or it’s now 10% cheaper to start an Australian gsuite competitor ;-)

90% of billions and billions of dollars is still billions and billions of dollars.

How so? You still have to pay the gst regardless of if you are Google or if you are in Australia

Isn’t “overseas digital goods and services tax” for overseas companies only ? Serious question here. On the island I live, we have a tax roughly translatable as « Sea tax » which is added even on locally produced good (sounds stupid? It is...)

No, local services have normal GST.

Not that you don’t have a point of sorts, but such a simplistic consideration of taxation seems dangerous to me.

There are many theoretical possibilities left unconsidered including some obvious ones, such as fewer EU users of the American services, which is a reasonable goal in many ways, including the interest of the citizens.

Also, not sure where you think tax money goes but, when a government is maintained to some extent by a concerned populace, taxation serves the collective interests of a society.

I don’t have a problem with taxation, nor a problem with revenue taxes which is essentially what a sales tax is. All I’m saying is the targeting here is obviously political and designed to hurt the American companies.

The result will be that the EU receives more tax revenue, but it won’t being coming out of Google and Facebooks’ collective pockets.

That is what will happen as it does with VAT. But it does end up reducing the divide from brick and mortar outlets. Though they will still be cheaper as they avoid the local business rates or local country equivalent, which really add up.

The customer is always the one who pays. Btw I would say put a 50% tax on ads.

But is it worse than a standard earnings tax?

Well, any companies that just squeaked out a 3% margin won’t be too fond of it.

Then you just pass the extra percentage to the business.

It's not like GST is any different.

Well even worse, with the 3% revenue tax, european customers would have exactly no benefit. the streets in europe will stay the same, the governement would still waste money for more staff (see germany for example, and trade it for police and customs). european would get even more bureaucratic and it will cost even more than the 3% will gain.

it's basically the same precedure as everytime.

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