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Internet taxes

Internet taxes
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Antonio de la Hoz

Antonio de la Hoz

Licenciado en Ciencias Empresariales por la Universidad complutense y Cunef. Licenciado en Economia Internacional por la Universidad Complutense. Trabajo como inspector y asesor de inversiones y director de los departamentos internacionales de ABN , Caja Duero y Cajas España, asi como consultor del Icex . Actualmente dirige la consultora Vector, especializada en información, comercio, financiación e inversiones internacionales.
Antonio de la Hoz

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As user and consumer, I wish to express my concerns about the new Internet tax that you envisage.
The technological and social revolution that brings Internet help EU and everybody to increase productivity, reduce expenses, travel time and carbon emissions, among others.
I remember the plants of EU plants setup in Lisbon on 2000, basically was to put EU at the forefront of science and technology on the world in coming decades. Of course nothing of it happened and in fact Europe lag behind not only Usa, but new entrants in Asia and elsewhere, so something was wrong and could be even worse.

In my modest view, this amazing proposal is against any economic principles:

1.- Don’t promote tax competition and effectiveness, companies are place where are better treated.

2.- You don’t charge earnings but revenues, forgetting that tax sales is unfair, since companies might lose money and most IT companies fall in the way, when bankrupt and only a few chunk of them survive (Why punish them for they success?).
It’s so absurd as USA new companies tax regime when remove interest on loans from expenses, a new tool to separate real net income (profit) for fiscal one.

3.- Finally, is absurd to believe that is a charge on the earnings of these companies since is power will translate these additional cost to consumers, as we have see here with many companies operating in oligopolistic markets. This measure, tax, would be deeply inflationary.

4.- Now the envisaged brackets indicates that only big players will pay but then, but why not reduce this bracket to all IT companies, and in the future, to all companies, in order to increase revenues as a general new “sales tax”. Here in Spain, they even talk of 5%, forgetting that the plant is between 1 and 5.

Frankly speaking under UK participation and pragmatism, these kind of policies should have been opposed strongly but now these guys are out, and we don’t have any people in Berlin, Paris or Brussels, that is willing and able to accommodate EU to this challenging new economy, you live in a former world, mostly over, and it would be a big hurdle in our future and of our childen.

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