European Politico-economics QA Mega-thread - Page 542

On August 27 2016 22:56 a_flayer wrote:
Why can't people just eat whatever is available. Whether it is dog, vegetarian or a sandwich. Sheez.

On August 28 2016 01:50 OtherWorld wrote:
^I don't necessarily disagree with what you wrote, but food served at school is not free food. It's cheap(er) food, but it still has a price that parents pay.

On August 28 2016 01:53 Ghostcom wrote:


That depends on where you live. In the Nordic countries I think the solution so far has been to make it tax-funded (although parents might pay a fee for having their kids attending kinder garden/private schools, but to the best of my knowledge these weren't bumped).

On August 28 2016 04:40 OtherWorld wrote:

Interesting. In France, if my memory is correct, the cost is decided by the competent authority - the mayor, the département or the région depending on what level of school we're talking about - and is usually a few euros.

On August 28 2016 04:42 zlefin wrote:

that may be the standard cost, but isn't there a program that makes them free and/or reduced price for poor children?
it seems like such an obvious thing to have.

Italian magistrates are to investigate whether companies ignored anti-seismic regulations when restoring public buildings, such as a school in Amatrice that was reduced to rubble in last week’s earthquake.

“Everyone suspects such a tragedy was not just a question of destiny,” said Giuseppe Saieva, chief prosecutor in the provincial capital of Rieti, north of Rome, who is heading the investigation. “Our duty is to verify if there was also responsibility, human culpability.”

Italy held a day of national mourning on Saturday for the 290 victims of the earthquake. In Ascoli Piceno, an emotional funeral was held for dozens of local victims. The president, Sergio Mattarella, the prime minister, Matteo Renzi, and other leaders were among the hundreds who filled a sports hall to mourn the dead. The mass was relayed by loudspeakers to many more assembled outside the hall.

A major focus of the judicial inquiry is the Romolo Capranica primary school in Amatrice, the town devastated in Wednesday’s 6.2-magnitude quake where 224 people died out of the total toll of 291. The school was inaugurated in 2012 after being rebuilt by a consortium of builders, Valori Scarl, which won a contract from Amatrice town council for €700,000 (£596,552) to implement anti-earthquake safety standards in the school buildings, according to judicial sources.

Also under the magistrates’ spotlight is the restructuring of the bell tower of the church at Accumoli, a town near Amatrice at the epicentre of the quake. A family of four were killed when the tower collapsed on their home. It had supposedly been restructured to anti-seismic standards with public funds that the Catholic diocese of Rieti obtained following the 1997 earthquake in central Italy.

Homeowners who employed companies that disregarded rules could receive compensation. But Amatrice residents who built extensions or made major home renovations without meeting anti-seismic standards could be prosecuted for causing the deaths of family members.

Police officers are guarding the heap of crumpled masonry which is all that is left of Amatrice town hall to prevent suspects removing municipal records that would show which companies won public contracts.

The US taxes companies on the basis of their worldwide profits though there are lots of ifs and buts about repatriation of profits. If some taxes are already paid by a US-based corporation, such as Google or Starbucks, in the EU then a credit for that amount is deducted from the US tax liability.

So a higher tax elsewhere can result in lower tax yield in the US and hence the US anxiety. In a stark warning, the US government paper warns that ‘The U.S. Treasury Department continues to consider potential responses should the Commission continue its present course.’

To understand the tensions let us look at the background. Many countries seek to attract capital by offering concessions. In a neoliberal world, direct state subsidies to corporations are frowned upon as nation states complain about unfair competition.

But this can be circumvented as governments can offer tax concessions to selected corporations rather than to all companies. The concessions create economic incentives for companies to devise transfer pricing techniques and shift profits to low tax jurisdictions through charges for intragroup interest payments, royalty payments and management fees.

This profit shifting affects the tax revenues of other countries. Such concerns have prompted the EU to investigate tax concessions offered by member states to Apple, Fiat, Starbucks, Amazon and McDonald’s. Last year, the EU decided that selective tax advantages for Fiat in Luxembourg and Starbucks in the Netherlands are illegal under EU state aid rules.

The companies were ordered to repay €20-€30 million i.e. higher taxes in the EU. Further EU rulings are expected soon about Apple and Amazon.

Globalisation has added further tensions to the EU and US concerns about corporate taxation. A company like Apple operates across the globe and has hundreds of subsidiaries. Nevertheless, it is an integrated entity with a common company board, business strategy and product. It makes profits through global integration and economies of scale.

However, nation states are confined to a defined geographical area and can only tax the profits made within their jurisdictions. So since the early twentieth-century, a variety of international treaties have enabled nation states to attribute corporate revenues, costs and profits to their jurisdictions.

These treaties established three principles. Firstly, companies would be taxed at the place of their residence rather than where the economic activity took place.

Second, even though companies may be under common ownership and control, they would be taxed as separate entities. Thus a company with 500 subsidiaries will be treated as 500 separate entities for tax purposes, which gives it a licence to engage in international tax arbitrage.

Thirdly, there was an issue about how intra-group transactions were to be assessed for tax purposes, as companies have operations and subsidiaries in other countries and transfer goods and services to each other.

The solution was to agree on what is known as transfer pricing and intra-group transactions were to be valued according to what the Organisation for Economic Cooperation and Development (OECD) calls ‘arm’s length’ principle, or free-market market prices.

The above system predates the emergence of the internet, transnational corporations, global oligopolies and a vast number of tax havens. It is now broken.

On August 29 2016 00:16 WhiteDog wrote:

V-I-C-T-O-R-Y

A good news once in a while is not that bad ! Now can we enforce some regulation to protect the environment, workers rights and favor the redistribution of wealth please ?

The free trade negotiations between the European Union and the United States have failed, but “nobody is really admitting it”, Germany's Vice-Chancellor Sigmar Gabriel has said.

Talks over the so-called Transatlantic Trade and Investment Partnership, also known as TTIP, have made little progress in recent years.

The 14th round of negotiations between American and EU officials took place in Brussels in July. It was the third round in six months.

At the time, the talks were thought to be in trouble after a number of leading European politicians expressed concern about TTIP’s effects and the US’s reluctance to accept changes to the proposed deal.

In May, cracks emerged when France threatened to block the deal.

President Hollande said he would "never accept" the deal in its current guise because of the rules it enforces on France and the rest of Europe – particularly in relation to farming and culture – claiming they are too friendly to US businesses.

“We will never accept questioning essential principles for our agriculture, our culture and for the reciprocity of access to public [procurement] markets,” Mr Hollande is reported as saying at a meeting of left-wing politicians in Paris. “At this stage [of the talks] France says, ‘No'.”

Speaking on Sunday, Mr Gabriel, who is also Germany’s Economy Minister, said: “In my opinion, the negotiations with the United States have de facto failed, even though nobody is really admitting it."

He said that during the talks neither side had agreed on a single common chapter out of the 27 being deliberated.

He further denounced the TTIP negotiations, saying the free trade deal proposed between the EU and Canada – the Comprehensive Economic and Trade Agreement (CETA) – was fairer for all parties.