Taxation policy proposal on harmonising the corporate tax base in Europe
Thread poster: eva75

eva75
English
+ ...
May 6, 2007

http://www.euractiv.com/en/taxation/commission-plans-eu-company-tax-despite-opposition/article-163497

What do other translators, who own translation companies, of the EU's plan?

What implications will this have for us translators?


Direct link Reply with quote
 

Williamson  Identity Verified
United Kingdom
Local time: 07:54
Flemish to English
+ ...
Which tax band? May 6, 2007

I wonder which tax-rates are going to be used:
The Scandinavian rate: High taxes, but good social protection.
or
The Belgian or French level of taxes, whereby the state legally steals half of the income of its citizens, due to high debts to its own banks (Belgium) or because it wants to control the income of its citizens (France). How many French translators did not complain on these forums that they had to pay high taxes.
or
The Luxembourg level (reasonable), the British (reasonable), Irish level (reasonable), the level of Eastern European Countries....? Or the level of former tax havens like Cyprus and Malta?
You can not escape taxes, but I for one do not like to work to finance the state and see half of my income go down the drain. Translation has the advantage that you can do it anywhere in the world and the E.U. is not equivalent to Europe. Some states are and will remain outside the E.U.
Ah, why don't I apply for a part-time job in the Vatican.

[Edited at 2007-05-06 10:43]


Direct link Reply with quote
 
RobinB  Identity Verified
Germany
Local time: 08:54
German to English
Just the latest little outburst... May 6, 2007

... in a never-ending saga.

Basically, even if they do manage to harmonise certain aspects of the basis of corporate taxation, the impact on small businesses (there are relatively few medium-sized translation businesses, and only a handful of large ones in the standard EU definition) is likely to be minimal or non-existent. The CCCTB project is basically aimed at large companies (or the larger end of medium-sized companies) with subsidiaries in other EU member states, or in the Commission's own words:

"The European Commission believes that the only systematic way to address the underlying tax obstacles which exist for companies operating in more than one Member State in the Internal Market is to provide companies with a consolidated corporate tax base for their EU-wide activities."

Because the CCCTB can only be adopted unanimously, it ain't going to happen on an EU-wide basis, despite the sqeaks of the commissioner, who seems hell-bent on allowing it to be implemented by a subset of EU member states.

I've been tracking this project for several years now. The most amusing development so far (actually, a catastrophe) was an incredible attempt by the Germans to impose their unbelievably complex, totally unworkable "tax balance sheet" methodology*) on the rest of Europe, accompanied by a working paper written in the worst form of "I can English" Denglisch. This wholly undesirable putsch seems to have been killed off for now at least, but it doesn't mean that the monstrosity that is German tax principles won't rise from the dead again at some point in the future like some sort of financial vampire.

*) There's disagreement on the actual figures involved, but there is a general consensus among tax experts that German tax literature accounts for somewhere between 50% and 75% of the world's tax literature. 'Nuff said...


Direct link Reply with quote
 

Giles Watson  Identity Verified
Italy
Local time: 08:54
Italian to English
Low tax, high tax. May 6, 2007

eva75 wrote:

So, small companies who have a business in a low corporate tax country will continue to pay the low corporate tax rate regardless of the location of his/her clients and the final destination of his/her translations?


Yes that's right, and the greater the differences in local tax rates, the greater the incentive for companies of whatever size in high-tax countries to relocate. This is just healthy competition among nations for investment.

FWIW

Giles


Direct link Reply with quote
 

Williamson  Identity Verified
United Kingdom
Local time: 07:54
Flemish to English
+ ...
Yes May 6, 2007

The answer to that is "yes".
A small company is a legal entity, not equal to a natural person. If need be the legal entity can pay the natural person a very low salary and make bigger profits by delivering a quality service. Of course, that legal entity can be a OneManShow. The company's tax-rate is based on its income. One of my acquiantances (an ITC-consultant) runs such a OneManShow. The company is based in Ireland, pays Irish taxes and he is a service-supply in the Benelux and the UK. He pays himself minimum wages.
But if you are "blinded by translation", you just go to the nearest tax-authorities. "Vive la France", "vive la République" and don't forget to give half of your income to taxes and social security contributions.

[Edited at 2007-05-06 20:59]


Direct link Reply with quote
 
RobinB  Identity Verified
Germany
Local time: 08:54
German to English
Tax base, not tax rate May 6, 2007

eva75 wrote:
So, small companies who have a business in a low corporate tax country will continue to pay the low corporate tax rate regardless of the location of his/her clients and the final destination of his/her translations?


The Commission's project is aimed at harmonising the tax base, ie the way in which tax is calculated, not the tax rate. However, a number of member states see this project (quite rightly IMHO) as an attempt to bring in a Europe-wide corporate tax rate by the back door. This is something that high tax countries such as Germany and France really want. But they're not going to get it.

BTW, the problem isn't so much with the tax rate in the country of domicile, but with higher/lower tax rates in other countries where the subsidiaries are located, and the ability to offset such higher/lower taxes. It's all complicated, though, and the ECJ is doing its best to prevent companies from being penalised by greedy governments.

One final word: if you sell translations to other EU member states, you don't pay tax there (what a crazy notion!). Neither is the final destination of a translation of any relevance whatsoever for taxation purposes. The main thing is to ensure that you're properly registered in your country of residence and that your tax affairs are clean.

Robin


Direct link Reply with quote
 


To report site rules violations or get help, contact a site moderator:


You can also contact site staff by submitting a support request »

Taxation policy proposal on harmonising the corporate tax base in Europe

Advanced search







WordFinder
The words you want Anywhere, Anytime

WordFinder is the market's fastest and easiest way of finding the right word, term, translation or synonym in one or more dictionaries. In our assortment you can choose among more than 120 dictionaries in 15 languages from leading publishers.

More info »
PDF Translation - the Easy Way
TransPDF converts your PDFs to XLIFF ready for professional translation.

TransPDF converts your PDFs to XLIFF ready for professional translation. It also puts your translations back into the PDF to make new PDFs. Quicker and more accurate than hand-editing PDF. Includes free use of Infix PDF Editor with your translated PDFs.

More info »



All of ProZ.com
  • All of ProZ.com
  • Term search
  • Jobs