France Leads Way on Tackling Tax Challenges of Global Digital Economy
With estimates of trillions of dollars held offshore by technology giants, 137 countries are debating proposals to address the tax challenges posed by a global economy that is increasingly digitalized.
“There is a loophole in the international tax system,” said Bruno Le Maire, Minister of Economy and Finance of France. Companies in the digital economy are not paying their fair share of tax in the countries they operate, he added. “We will not give up on this. Companies that owe France’s digital tax will pay.”
The French tax imposes a 3% levy on the revenues of technology firms earning at least €750 million in annual global revenue on their digital services. The tax targets revenue instead of profits, which are often reported by technology giants in low-tax jurisdictions.
Le Maire went on to outline France’s preference to have an international solution. Hence the French government is working with counterparts in the US and with the Organisation for Economic Co-operation and Development (OECD). “We are united in Europe and we hope that by the end of 2020 we have an international agreement to tax digital revenues,” he said. However, if an international agreement is not reached, he stressed that France will revert to its national solution.
The French perspective is widely shared among OECD members, said Angel Gurría, Secretary-General of the OECD. “A new set of rules needs to be established to deal with the new realities of the digital economy.”
Indeed, the rise of digital giants has challenged the tax system, which is built for another era. For instance, most legacy tax systems rely on companies having a physical presence in a particular country – something that is less relevant in the digital age.
Despite the challenges of having 137 countries around the table, Gurría is sanguine: “I’m not just optimistic, I’m ‘activistic’. We will get this done.”
“At the heart of this tax issue is sustainability and fairness,” said Delia Ferreira Rubio, Chair of Transparency International. Multistakeholder action is required – the rules need to be absolutely clear and we need enforcement, she added.
“Multilateralism is key,” agreed Katharina Pistor, Edwin B. Parker Professor of Comparative Law, Columbia Law School. Whether current tax structures used by multinational organizations are technically legal or not misses the point as to whether they are transparent, sustainable and fair. The lines between tax avoidance and tax evasion are blurry, she added.
Shedding light on the Sun
As questions abound about the Earth’s closest star, scientists are seeking answers critical to forecasting solar flares that threaten satellites and other electronics.
By ANTHONY KING
For most of humankind’s history, it has been hard to explain the Sun as anything other than a powerful deity.
For instance, the ancient Greek god Helios – the personification of the Sun – raced his chariot across the sky to create night and day, whereas the ancient Egyptians worshipped their falcon-headed sun god, Ra, as creator of the universe.
Since then, science has revealed that, for example, the Sun on average turns on its axis once every 28 days. But at its equator, the hot plasma ball rotates once every 25 days, while it takes around 35 days at the poles, creating a swirling soup of piping hot plasma.
Nonetheless, the power of the Sun can still offer surprises, with blasts fierce enough to fry communication satellites or electronics on Earth. Scientists warn of more powerful solar flares as a peak of activity approaches in late 2024 and early 2025.
‘There is this turbulent motion inside our star, called convection, that is a bit like how water wrinkles just before it boils,’ said Professor Sacha Brun, director of research at CEA Paris-Saclay, part of the French Alternative Energies and Atomic Energy Commission.
An infamous magnetic storm that hit Earth in September 1859, known as the Carrington Event, triggered spectacular auroras far from polar regions and sizzled telegraph systems around the world.
There have been more since. In 1989, a geomagnetic storm caused a blackout in Quebec, Canada, according to Brun.
Greater knowledge about the Sun is needed to predict and understand such events.
That swirling ball of hydrogen and helium is also unimaginably hot – with core temperatures of 15 million °C. And it’s ginormous – more than 1 million Earths fit inside the Sun.
Its peaceful presence on a summer’s day belies the intense nuclear reactions at its core that generate vast amounts of energy. The Sun is a churning ball of plasma, with gases so hot that electrons are booted out of atoms, generating intense magnetic explosions from its surface that spew billions of tonnes of matter into space.
As it spins, the Sun’s mechanical energy turns into magnetic energy – a bit like the dynamo on a bicycle light, where pedal motion is converted into magnetic energy.
On the Sun, twisty ribbons of magnetism rise and break out as sunspots, dark patches at the surface where the magnetic field is 3 000 times more intense than in the surrounding areas.
Sunspots can trigger those solar flares that damage electrical equipment. But this activity isn’t constant.
‘The magnetism of the Sun is variable over an 11-year cycle,’ said Brun, an astrophysicist.
Over that cycle, coronal mass ejections rise in frequency, from one every three days to an average of three per day at its peak.
‘As we go further into the cycle, more outbursts will emerge from the Sun,’ Brun said. ‘People don’t realise that the Earth bathes in the turbulent magnetic atmosphere of our star.’
So there’s an obvious need to anticipate when such solar storms approach. For example, a solar flare in February 2022 knocked out 40 SpaceX commercial satellites by destroying their electronics.
Those energetic particles take just 15 minutes to reach Earth from the Sun. The threat posed by magnetic clouds usually takes a few days, offering more time to brace for any onslaught.
Brun co-leads an EU-funded project called WHOLE SUN to understand the interior and exterior layers of the only star in the Earth’s solar system.
Running for seven years through April 2026, the initiative focuses on the inner turbulence of the Sun and the complex physics that turns the inner turmoil into magnetism in the outer layers.
This requires the most powerful supercomputers in the world. Yet forecasting solar flares means that scientists gain greater understanding of the insides of the Sun.
A star is born
What about the distant past of the Sun? It has been around for 4.6 billion years – 100 million years before Earth. Where and how it was formed would seem to be an impenetrable mystery.
Not so, according to Dr Maria Lugaro at the Konkoly Observatory of the Hungarian Academy of Sciences.
Lugaro, an Italian astrophysicist, is researching this very question in the EU-funded RADIOSTAR project. It began in 2017 and runs through August this year.
‘We believe that the Sun wasn’t born alone, but was born in a star-forming region where there’s lots of stars,’ Lugaro said.
She is looking into this past by examining chemical fossils in meteorites today.
Radioactive atoms are unstable. They release energy and decay into so-called daughter atoms, over a certain length of time, which are measurable. The daughters are therefore chemical fossils, offering information about long-gone radioactive atoms.
Lugaro’s research suggests that the Sun originated in a stellar nursery that contained lots of siblings, including exploding stars – supernovas. But digging into the Sun’s history first requires finding meteorites, bits of rock formed before Earth.
These meteorites can contain traces of the radioactive atoms such as aluminium-26 and hafnium-182. It is known that these lived only a certain length of time. Together, traces of such atoms can be used as a radioactive clock to compute the age of the stars that made them, relative to the age of the Sun.
Some radioactive atoms are made in only certain types of stars. Their presence in meteorites helps to recreate a picture of the Sun’s birthplace, albeit one that’s up for debate.
It may be that the Sun was birthed amid dust and gas clouds in a tempestuous region alongside supergiant stars and exploding stars.
Within perhaps 20 million years, the different stars begin to make their own way out of the nursery. But things are far from being scientifically settled.
‘Every year there’s debate: is the Sun normal or is it a weird star?’ said Lugaro. ‘It’s quite fun.’
Research in this article was funded via the EU’s European Research Council (ERC). The article was originally published in Horizon, the EU Research and Innovation Magazine.
Biden is preparing Americans to lose the Second Cold War?
Vladimir Putin’s approval rating is 82%. Joe Biden’s is 42%. Xi Jinping’s is anyone’s guess, but the Chinese near-unanimously trust their government. More than half of Russians trust their government. Less than a third of Americans trust theirs. These statistics are not random but speak to America’s imminent loss in this, the Second Cold War, writes ‘The American Thinker’.
Why aren’t Americans rallying around the flag? Pride, approval, and support for their respective flags in China and Russia, but not the same in America, is not an accident. All governments influence the memories they want their people and foreigners to have of them. It’s called political memory.
A look at how the governments of Russia, China, and the United States are leveraging political memory sheds light on why Russians and Chinese love their governments and rulers, and Americans are souring on America and Biden. This simultaneous occurrence is not an accident. Russia and China are preparing to win the second round of the Cold War, and America is handing them the opportunity to do this.
The goal of Russia’s political memory is “to give students and ordinary citizens a simple and consistent narrative of a powerful nation they can take pride in.” School begins by singing the national anthem and raising the Russian flag. Taking a knee or disparaging the Russian flag is unthinkable. Putin, to be certain of unified support for the actions taken, restore Ukraine to its rightful place, and prepare for Cold War II, launched a new patriotic history in 2022. Putin described the purpose: “A deep understanding of our history… to draw correct conclusions from the past.”
Russia’s political memory constantly conditions Russians to fear existential threats, particularly from the West. It’s why they revere their militaries and have always been prepared to endure heavy casualties in war. The military prevents the Russian state from being subjugated.
Russia’s approach to political memory is consistent with China’s approach and motivated by the same theme: China lives with a perceived existential threat to its independence, particularly from the west. Cold War II will test its resilience.
China began preparing for round two at the end of Cold War I. This is when it began its “Patriotic Re-education Campaign.” Cementing patriotism in China, as in Russia, is key to preparing for and achieving victory in Cold War II.
China’s and Russia’s approaches to political memory are contrary to the U.S. government’s. Instead, America appears to be preparing to wave a white flag, or maybe a rainbow-colored one. Pride in America has been sinking, and this ties to the government’s design for America’s political memory.
This political memory could emphasize things such as America being the first colony to defeat a European empire or its WWII victory over fascism. Or it could tell how, in just over 150 years, America became an economic powerhouse on the back of capitalism and then sustained this with an education system designed to unify Americans and later foster innovation.
Instead, the center of history in 4,500 schools is to depict American slavery via exaggerated interpretations of personal memories, untempered by facts. Instead of a history of patriotism and achievement, the American government is supporting a history of trauma, including systemic racism and inequality.
In 2022, it was reported that the average IQ of Americans dropped for the first time in 100 years. The researchers speculated that it was due to changes in the educational system.
The Biden government’s trauma-centered political memory strategy to divide America politically, and racially has motivated this Russo-Chinese partnership and escalated the likelihood of Cold War II, – writes the “American Thinker”.
Riyadh joins Shanghai Cooperation Organization
Saudi Arabia’s cabinet approved on Wednesday a decision to join the Shanghai Cooperation Organization (SCO), as Riyadh builds a long-term partnership with China despite U.S. security concerns.
Saudi Arabia has approved a memorandum on granting the Kingdom the status of a dialogue partner in the Shanghai Cooperation Organization, state news agency SPA said.
The SCO is a political and security union of countries spanning much of Eurasia, including China, India and Russia.
Formed in 2001 by Russia, China and former Soviet states in Central Asia, the body has been expanded to include India and Pakistan, with a view to playing a bigger role as counterweight to Western influence in the region.
Iran also signed documents for full membership last year.
Dialogue partner status will be a first step within the Organisation before granting the Kingdom full membership in the mid-term.
The decision followed an announcement by Saudi Aramco, which raised its multi-billion dollar investment in China, by finalising a planned joint venture in northeast China and acquiring a stake in a privately controlled petrochemical group.
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