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The original title is "Italy stiffens terms of digital services tax in 2025 budget", which totally fits the required HN length. HN suggests to stick as close as possible to the original title, which given that this title does not overrun the length would be exactly this title.

Why is the title changed so much? I know we're supposed to assume good faith, but in some cases it is difficult.

I haven’t decided yet where I stand on this, however…

…As I understand it, the intent of the law is to avoid that large companies book billions of revenues in the country, but then use price-transfer schemes to book the profits somewhere else, and not pay any taxes locally.

The net effect of the law on larger internet companies is probably marginal, but I am not sure the law was designed well enough, so as to avoid collateral damage on smaller internet companies

I thought this was what was being implemented to fix that -> https://en.wikipedia.org/wiki/Global_minimum_corporate_tax_r...
The way Italy is implementing their own law looks kinda like ultimatum for others to implement minimum corporate tax law. As was agreed, but then never done because China and US are arguing details and everyone knows last one to implement theirs is likely a winner economically.
You can sit around and wait for decades until this might get meaningfully implemented, loopholes get closed and enforcement is strict. Great step by Italy to refuse that and just implement a measure in the meantime. Can always be repealed if indeed things get fixed on a global level.
Yes, but now it's for everybody.
This is mentioned in the article, but it's important to know that this is not just some Italian novelty, there has been a worldwide effort to figure out how to tax digital services provided by multinational companies in a way that makes sense and avoids funny business with transfer pricing and other tax loopholes, see https://en.wikipedia.org/wiki/Base_erosion_and_profit_shifti.... The news here is primarily that Italy is not waiting on a big multilateral agreement but has started to implement some of these ideas on its own.
Paying tax is normal for most companies. I am not sure why the us is being the slave of these companies and threatening retaliation. Apparently it wants to be the only one to take a cut (despite money being made from Italians). That's extreme. If NATO is a family of mobsters, then this is not how things are done within the family. I know we're not supposed to anger the us as they are the best guarantor for European security and freedom but such bullying tactics, effectively making Italy pay a tribute like a vassal state, does make me question whether we can be independent and guarantee such things ourselves.
The current HN Title bears zero-ish resemblance to the Reuters article title. And that article seems to assume a load of prior knowledge.

SO - what is the fuss over here? Is Italy doing anything more than say "if you sell digital widgets into Italy, then you gotta pay Italian sales tax on that revenue"?

Yes - "if you have Italians connecting to your website and look at ads, even if you make $0.01 total, you have to register and pay 3% of that, or else".

This is already in effect for big corps like Google, but now it seems to be for everyone - therefore its presumed relevance to HN.

Is there some other (more basic, or longer) article where that is spelled out?

Because I'd never have guessed it from Reuters' crappy coverage.

Revenue (not profit) taxes have a bad history and are generally abhorrent because they incentivize many suboptimal things both in theory and practice. Trying to impose this kind of tax on companies that have no meaningful presence in your jurisdiction, subjecting them to these perverse incentives, is going to invite significant backlash. Everything about this seems foolish and poorly thought out.
Think of it as sales tax for b2b transactions. It's a giant hole in most countries' taxation schemes, where b2c transactions are taxed, but b2b are entirely tax-free.
Are you claiming that Google, Meta and Amazon don't have a meaningul presence in Italy? They're free to not serve their content there then.
That's not the problem. You can't tax Google profit in Italy. It's an American company. You can apply sales tax and custom duties, however. This is what this "tax" is. But because of the WTO, they couldn't apply duties, so they are twisting the story.

The WTO agreements and institutions are due to collapse in the next 2-4 years (and nope, am not saying that, see Macron latest interview about cars).

The issue, which has been raised in diplomatic discussions on this matter, is that multiple countries are claiming the same revenue as “domestic” and wish to tax it simultaneously. This quickly becomes untenable and isn’t a good look for tax policy.
> Italy will also raise a tax on capital gains stemming from cryptocurrency such as Bitcoin to 42% from 26%, Leo added.
It is time for the Big Techs financial loopholes in Europe to end.
I am european and I think our countries are in a massive state of decline Slovakia introduced tax on digital financial transactions for next year.

As a European I want OUT of this hellhole.

Oh, Slovakia is going to continue this trajectory for the next couple of years and beyond if the government doesn't change next elections.
Slovakia is probably one of the worst countries in the EU in terms of opportunities, maybe just getting out of that specific place might help you? Czechia is right around the corner, Poland as well, and they fare better than Slovakia in pretty much every way.

Edit:

> "Portuguese, Indians, Brazilians are on my no-hire list. They have corruption and cronyism embedded in their DNA."

Ah, just noticed you were the user who posted this stupidity some weeks ago, thought the name was familiar because this comment really showed some true colours. Please, pack your shit and get moving to Russia to stay away from the hellhole :)

It's also one of the EU countries with the least debt to gdp, still has industries, good agriculture, 90%+ of home ownership, &c.

France and Germany are in much deeper shit compared to Slovakia, look at property tax, tax on land, income tax, Slovakia is almost a tax heaven in comparison

I think you could have toned down the rhetoric a bit, but I do agree that the comments you mentioned aren't great, and did add context to the comment you replied to.

You're not wrong, though. Slovakia is at or near the bottom of EU average wages iirc.

I wasn’t able to find where they said what you quoted.
This continent is hellbent on descending into irrelevancy and self-destruction.

Bright spots include AI research and some spots related to it, like Paris AI community, but the regulators can quickly kill that.

To just register a digital business and make one euro, an average American would cry out laughing.

> just register a digital business and make one euro, an average American would cry out laughing.

At least in my country (France) it's not any harder than registering as an independent worker (you often use the exact same legal vehicle for both).

The real problem with European tech is that it's too easy for US company to land on the continent, and since they have a biggest market to begin with they always end up stronger than European companies when it comes to addressing the other European markets. The “single market” is a fantasy, every country has its own language, culture and business practices, things that EU's homogenization of regulations between country since the 80s have never overcome and never could have, and because of that it's not harder for an American company to do business in an EU country that it is for another European country.

Since forced homogenization isn't gonna do it, the correct approach would be to put barriers to foreign entry like Evey successful Asian country did in the second half of the 20th century with great success.

Advocating for free trade with a much more powerful country than your is as insane as it would be to advocate to remove the fences in a zoo…

Here's what it took for the small American company I work at to get registered to sell downloadable digital goods from our American web site to EU customers:

• About 15 minutes or so on the website of the Irish tax authorities.

Once we started selling, here's the ongoing burden:

• Collect VAT at the VAT rate of the country the customer is in.

• Early on in each quarter run a script that produces a report that shows our total sales for each EU country and how much VAT we collected for that country.

• Upload that report to the Irish tax authorities and give them the total VAT we collected. The Irish tax authorities deal with reporting our sales to the other countries and distributing the collected VAT to them.

• Keep our VAT rate table up to date. Unlike sales tax in the US VAT rates rarely change. Looking at our database of VAT rates I see an average of 1.7 rate changes per year over the last several years. That's 1.7 changes per year for the whole EU, not per country.

When VAT changes it almost always changes on a quarter boundary (I think I've only seen one or two times when it changed during a quarter).

Since the rates are per country there aren't many of them. It would not be too much hassle to simply download the rates from some EU government site and manually update our rate DB.

What we actually do is use an API from apilayer.com. Their free tier allows 1000 requests per year which is way more than are needed to keep up with VAT changes since it is one API call to get the rates for all of the EU.

We used Ireland because English is one of their official languages. We could have picked any other EU country to deal with instead of Ireland, although the registering and reporting details would differ so registering and reporting might not be as easy.

Compare to what an American company that wants to sell to multiple American states has to do to deal with sales tax. The tax depends on the exact address of the buyer, not just the state, and you have to register and file with each state. Generally dealing with that means you have to use a paid service which will charge a percentage of your sales.

If you only need to collect tax in the states that have joined the Streamlines Sales Tax group you can get a sort of EU like experience. To that you have to agree to collect tax for all of the SST states even if you only are actually legally required to collect for some of them, and then you can use a paid tax service from their list and the SST states will pay the cost of that.

If you need to collect tax for any of the approximately half the states not part of SST then you'll have to deal with those states separately.

If Slovakia is bad look at France or Germany lmao, breathing will be taxed soon enough here
So... crypto will be taxed the same as stocks? The pathology is that in Europe the only untaxed gains are on crypto and real estate (after some years of ownership usually). That's how you arrive to a pathetic state the EU is now dwelling in. Slovakia economically sits on the lap of German automotive. When you visit you see many luxury cars and prices of real estate in village of Bratislava are through the roof, weird isn't it?
Not all of Europe is like Slovakia...

In NL, bitcoin gains are taxable and there is a real estate tax.

> The pathology is that in Europe the only untaxed gains are on crypto and real estate (after some years of ownership usually).

Where in the developed world do you get untaxed gains on anything? Not even the USA has untaxed gains... Many loopholes if you are rich but you probably don't have access to those mechanisms.

Success must have a price. Let's call it 'success tax'
It's called a progressive tax, and it's a great idea.
If taxing something discourages it, we should instead create a "failure tax", which you only pay if you don't make very much money, to discourage failure.
Is it that different to any sale tax?
The problem with "sales tax", or "value-added tax" in Europe, is that it applies only to consumers.

Businesses can directly deduct any VAT that they pay from the VAT that they owe. If they pay more VAT than they owe, they can get it back.

This means that Google, Meta, etc., who make almost all of their revenue from B2B transactions, effectively pay no VAT.

The "digital services" tax changes that, by introducing a tax on those revenues.

Well, every gains tax is kind of success tax, aint it?
Yes, if your success relies on a complex framework of infrastructure and societal services, then your success owes that infrastructure a share.
That infrastructure does get its share, its called income taxes, sales taxes from products people buy, payroll taxes, mandatory employee provident fund contributions which governments use as their personal piggy bank in a lot of countries , and most importantly the product/service itself, good luck swimming in your pool of tax dollars, when that dollar is worth nothing, because you dont have much products or services to buy with it.

The reality is , recent politicians have been wasting money excessively, 50-60-70% of the tax revenue ends up being lost to corruption, inefficiencies, etc.

One can continue promoting taxing more and more, it’ll just end up killing the golden goose.

The problem is more with the oligarchic style of engagement between big corps and gov, its stifling innovation, making medicines 10000x more expensive than it needs to be, with extremely insane patents stifling competition and small startups defeating old barrons, a overly litigious society which is rampant in most western countries.

We keep losing our free market, and thus losing prosperity of the middle class, and we keep blaming it on not taxing enough…

If you can't create innovation, just tax it.
It's a regressive tax that will only be paid by poor people. Rich people will have ways around it.
Europe being Europe. But more importantly, I find it a but strange the countries with growing deficits thinking that raising taxes is the right move towards improving the economic situation instead of restructuring
> I find it a but strange the countries with growing deficits thinking that raising taxes is the right move towards improving the economic situation instead of restructuring

Speaking of restructuring, how about we restructure the way multinationals pay taxes in Europe?

"Amazon pays no corporation tax in Europe despite €44bn sales" https://www.irishtimes.com/business/economy/amazon-pays-no-c...

"Facebook UK pays £29m corporation tax despite record £3.3bn sales" https://www.theguardian.com/technology/2022/oct/06/facebook-...

"Microsoft’s Irish subsidiary posted £220bn profit in single year [..] An Irish subsidiary of Microsoft recorded a profit of $315bn (£222bn) last year [..] The profit generated by Microsoft Round Island One is equal to nearly three-quarters of Ireland’s gross domestic product – even though the company has no employees." https://www.theguardian.com/world/2021/jun/03/microsoft-iris...

Raising taxes on foreign multinationals who are profiting off your economy almost certainly is the right move.

Unlike raising taxes on your own citizenry, it has none of the usual downsides.

(As a European) I see the party Brothers Of Italy which currently hold power in Italy as a decidedly hard-line right-wing party. And just like pretty much every other right-wing party with a populist bent they promised a lot of tax cuts to get into power.

But then they realised they had to raise taxes _somewhere_ to afford everything else they wanted to do… So instead of doing a mea culpa they instead put forth this stupid law.

Because they gave up their monetary sovereignty they have very few options when it comes to funding.