How would this affect the big players? Like MS -you buy from the European branch and they use buy from US. So hitting them with tariffs would hurt MS more than their customers?
I understand they will raise prices, but its not like with physical goods where the same item is resold. They use other ways to transfer money because tax
The purpose of tariffs (in a normal world) is to make it harder for domestic entities to buy international goods. Typically, this will spur growth of a particular sector of industry within a country over time.
The way Trump is using them as a battering ram in an attempt to punish other countries, rather than incentivize steady growth, is why the US market is tanking and likely headed to another recession (or worse).
By retaliating in kind, the EU will be incentivizing their citizens and companies not to buy from the US. This will hurt companies that are based in the US, like Google, Microsoft, Meta, etc., further sending the US economy into freefall and bolstering the European economy, since they aren’t trying to punish every single trade partner in existence.
There may be other ways they try to move money around to avoid the tariffs, but governments are aware of how big businesses operate and often try to close those kinds of loopholes. Since this has become a global political issue, I would imagine they’ll be keeping a more watchful eye than normal on things.
It becomes very hard to tariff intangible services like those provided by tech, or financial securities.
If the datacenter is in the EU and that EU data center is servicing EU does it get tariffed? I think they should just do shit like requiring certain infrastructure and job investments in the EU or pay higher tax rates on revenue.
Current US tax policy, GILTI and FDII already kinda incentivize offshoring for multinational companies based in the US. Companies that deal largely in intangible good are already outsourcing jobs. EU forcing them to speed up this process puts both Trump and the multinational companies in a double bind.
Neither can really make a move in their best interest without pissing the other off.
How would this affect the big players? Like MS -you buy from the European branch and they use buy from US. So hitting them with tariffs would hurt MS more than their customers?
I understand they will raise prices, but its not like with physical goods where the same item is resold. They use other ways to transfer money because tax
The purpose of tariffs (in a normal world) is to make it harder for domestic entities to buy international goods. Typically, this will spur growth of a particular sector of industry within a country over time.
The way Trump is using them as a battering ram in an attempt to punish other countries, rather than incentivize steady growth, is why the US market is tanking and likely headed to another recession (or worse).
By retaliating in kind, the EU will be incentivizing their citizens and companies not to buy from the US. This will hurt companies that are based in the US, like Google, Microsoft, Meta, etc., further sending the US economy into freefall and bolstering the European economy, since they aren’t trying to punish every single trade partner in existence.
There may be other ways they try to move money around to avoid the tariffs, but governments are aware of how big businesses operate and often try to close those kinds of loopholes. Since this has become a global political issue, I would imagine they’ll be keeping a more watchful eye than normal on things.
It becomes very hard to tariff intangible services like those provided by tech, or financial securities.
If the datacenter is in the EU and that EU data center is servicing EU does it get tariffed? I think they should just do shit like requiring certain infrastructure and job investments in the EU or pay higher tax rates on revenue.
Current US tax policy, GILTI and FDII already kinda incentivize offshoring for multinational companies based in the US. Companies that deal largely in intangible good are already outsourcing jobs. EU forcing them to speed up this process puts both Trump and the multinational companies in a double bind.
Neither can really make a move in their best interest without pissing the other off.