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Comment by dazc | Hacker News Reader

Luxemberg and Ireland are both part of the European Union. Maybe allowing individual member states to operate as tax havens is not benefitting the Union as a whole?

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Even Luxembourg and Ireland have non-zero corporate income tax rates. If Amazon is managing to not pay any corporate income tax, then it's corporate income must be 0 or negative, so the fact they have low corporate income taxes is irrelevant.

The tax rate is a single easy number to point to. But there also is lax to nonexistent enforcement and a very lenient tax code to start with. There have even been cases where member states refused to collect taxes that were due, where European courts tried to force the states to collect (Apple in Ireland is a famous example).

That's not what happened. The European Commissioner for Competition decreed that Apple had received illegal tax benefits from Ireland and ordered Apple to pay a fine of €13 billion. This was appealed to the European General Court, which ruled in favour of Apple and struck down the Commissioner's decision as illegal.

No that’s not what happens either.

Apple wasn’t sued or fined and didn’t go to court, the ruling compelled Ireland to collect additional tax from Apple and Ireland was the one who went on and spent tax payer money on appealing the decision in the EGC.

Their nominal tax rates is not the issue. Allowing entire profits realized in EU to leave to the Bahamas through layers of companies incorporated in Luxembourg/Ireland/Netherlands is.

Is there some reason why wholly owned subsidiaries should pay income tax at all in other countries? I own assets in the US, but I don't pay income tax there, because I live in another country, where I pay income tax on my worldwide income. Amazon "lives" in the US (headquarters are in Seattle, WA), so why would it pay income tax in other countries? Its wholly owned subsidiaries are just parts of the whole, and should be taxed as such.

It isn't. But the tax havens, mostly Malta, Luxemburg, the Netherlands and Ireland block everything that limits their shenanigans. Unfortunately the EU is ruled (depending on the topic) by a double-majority of 60% of population and states or unanimously. The latter is usually used in financial topics. So this will never change.

Don't be so sure it will never change.

Until last year the EU had zero involvement in healthcare and public safety, that was every nation's own private garden.

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