Monday 1 February 2016

International tax system is needed

Recently Alphabet, Apple and some other global companies are fighting a global tax war. Alphabet and Apple are huge companies and two of the most valuable companies in the world and make huge profits. They almost operate in all countries around the world. Every countries want to share their success by receiving more tax from them. Because countries have different tax policies, global firms have very complex tax efficient strategies. For example, the amount Amazon's sales in the UK are greater than most of other EU countries; however, the tax it pays in the UK is not proportional to its revenues. Countries are competing with each other in order to gain more profits from taxing those global companies. Governments may decide to reduce their tax rates in order to attract the companies to pay tax on higher proportions of their revenue in their countries. Therefore, I believe that if the governments want to gain the most out of these huge companies, they need to unite together and form a global tax system.

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