What countries can learn from Facebook – dont tax your citizens, only corporations

I think facebook is trying to be a country NOT a company. Therein lies its huge valuation.

1. A country with over 800 Million citizens that are all over the world.

2. A country which is rolling out its own passport called verified IDs.

3. A country with its own currency called Facebook credits.

4. A country which has citizens (users) who dont pay any tax to access any of its services or infrastructure.

5. A country where every corporation (Zynga, etc.) that wants to sell to the citizens who buy virtual goods pay a flat 30% tax on every purchase by a user – so yes the user indirectly pays.

6. A country whose benevolent dictator wants its citizens to know its social mission.

7. A country is very business friendly and is increasingly becoming more useful to them.

8. A country with privacy issues with its users to deal with.

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4 thoughts on “What countries can learn from Facebook – dont tax your citizens, only corporations

  1. Ronald Rutledge

    Being a homeowner you are obliged to pay more than your mortgage. You need to keep and develop your house too. Aside from purchases and developments, interest contributes to your expenses, even have a bigger part. These expenditures can be exempted and thus lowering your burden of paying them off. But you must learn these items that are deductible and what expenses that can help maximize your tax benefits.

    Reply
  2. Nilesh

    If by “corporations”, you mean anyone who is making a profit by providing services to the citizens – that’s exactly what income tax is about. But if you mean corporations as in companies alone, then I disagree.

    I think we must differentiate between what “is” and what “should be”. No doubt, there are similarities but I don’t think countries should try to become more like Facebook by taxing only corporations and not citizens. The objectives of the two entities Facebook and a country are different. Facebook’s objective is to maximize its own profit – even if it ultimately comes at the expense of citizens or corporations. Governments are political structures – they are only meant to serve citizens.

    Taxing only corporations brings in a distortion: it creates an artificial bias towards independent workers or employees and a disincentive for employers. Are you sure that’s what we should aim for?

    Reply
    1. Mukund Mohan Post author

      Nilesh
      I did mean corporations alone (those that offer services), but if an individual offers services for profit (or makes a profit by offering services) then s(he) should pay taxes.
      I am actually of the perspective that government that should maximize profit from entities that offer service to pay for those that cannot.

      Reply
  3. Kartik Parija

    A couple of days ago I had remarked to a close friend about how FB (I had just read their S1 filing), is the ‘new Singapore’ or rather an internet generation version of Singapore. Your detailed description is much better, but my thought stands…. I also owe you a reply to your email…will get to it tomorrow….

    Reply

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