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Hetzner begins to charge tax for US clients? - Page 3
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Hetzner begins to charge tax for US clients?

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Comments

  • @jar said:

    @donli said:
    Even Aliexpress is charging sales tax for US customers nowadays.

    They have an office in California and sell physical products so that makes sense.

    Company Name: HETZNER US LLC
    Entity Type: DOMESTIC LIMITED LIABILITY COMPANY
    File Number: 5394417
    Filing State: Delaware (DE)
    Filing Status: Active
    Filing Date: March 5, 2021
    Company Age: 7 Months

    (From: https://www.bizapedia.com/de/hetzner-us-llc.html )

    Thanked by 2jar w_ho_ami
  • jarjar Patron Provider, Top Host, Veteran
    edited October 2021

    @donli said:

    @jar said:

    @donli said:
    Even Aliexpress is charging sales tax for US customers nowadays.

    They have an office in California and sell physical products so that makes sense.

    Company Name: HETZNER US LLC
    Entity Type: DOMESTIC LIMITED LIABILITY COMPANY
    File Number: 5394417
    Filing State: Delaware (DE)
    Filing Status: Active
    Filing Date: March 5, 2021
    Company Age: 7 Months

    (From: https://www.bizapedia.com/de/hetzner-us-llc.html )

    Interestingly they didn't say Hetzner US LLC though in the email. That's one of many reasons the language doesn't make sense.

    GST isn't a term used in the US but asking for local tax exemption in the US implies collecting taxes for the US, but there's no US sales tax (no federal sales tax) and they're not a taxable entity where I live, meaning they physically can't submit sales tax for me. Wouldn't be accepted.

    So until they clarify none of this really makes sense. The announcement was too broad to cover a country that doesn't have any consistent rollout for sales tax from one end to the other.

  • @jar said:

    So until they clarify none of this really makes sense. The announcement was too broad to cover a country that doesn't have any consistent rollout for sales tax from one end to the other.

    Paging @Hetzner_OL

    Thanked by 1jar
  • Recently over 138 countries signed the International Tax agreement whereby they'll have to pay taxes for services given in another country other than the origin (like Webhost in Germany selling services to U.S or Canadians). This will be also applying to hosting services so it might be a next step from Hetzner and same we might see similar taxation from other ecommerce/online companies worldwide. Though I'm not sure whether this agreement covers collecting VAT/GST/other Tax directly from customers.

  • jon617jon617 Veteran
    edited October 2021

    I thought the OECD Global Tax treaty was a global 15% minimum corporate tax rate on income. I don't think sales tax is part of it.

  • adlyadly Veteran
    edited October 2021

    @PUSHR_Victor said:
    PS. For UK: A EU-based business is supposed to charge UK VAT rate and then submit it to the authorities in the UK. However, this requires the supplier to be a legal entity registered in the UK. If they are not, they are not supposed to provide services to UK customers. This rule is not being enforced since the UK government basically has no way of restricting EU-based businesses to offer their services to UK customers.

    What absolute nonsense. All businesses outside the UK are supposed to charge UK VAT, which they submit to the HMRC in the UK by registering as a non-established taxable person and submitting VAT returns.

    There is no requirement to establish a local company, and no restriction on trade with EU-based businesses because of VAT. They simply have to follow the same procedure every non-EU based business does and have been doing for some time.

  • Delaware state provide fake business registration for money. Remind me ReadyDedis Indian provider who register LLC in US even not a visiting they physically. And he will start charge taxes from US clients with it? That absurd.

  • Charge taxes from overseas just colonial practice used in 18-19 century, when big empires charge taxes from their vassals. Germany becomes a new colonial empire? :smiley:

    Thanked by 1jar
  • jarjar Patron Provider, Top Host, Veteran
    edited October 2021

    @jenkki said:
    Charge taxes from overseas just colonial practice used in 18-19 century, when big empires charge taxes from their vassals. Germany becomes a new colonial empire? :smiley:

    I must admit, I've found that people in Europe don't like it when I respond to demands that I follow their laws with "Send troops." July 4, 1776, some people did something. Literally the short version of why any country has a military is to prevent other countries from imposing their own laws on them.

    Of course, in this case, I'm free to not do business in another country. But if I thought they were telling me that they were charging their local taxes to pay their local government I wouldn't have spoken up at all. That would be totally fair game. And if it turns out to be the case, I won't disagree with their call I'll just have to make business decisions accordingly.

    When you're in someone else's house you have to follow their rules. Hopefully tomorrow they'll let me know who thinks they're in what house and why. Stay tuned for the details ❤️

    Thanked by 1w_ho_ami
  • jenkkijenkki Member
    edited October 2021

    @jar said: I must admit, I've found that people in Europe don't like it when I respond to demands that I follow their laws with "Send troops." July 4, 1776, some people did something. Literally the short version of why any country has a military is to prevent other countries from imposing their own laws on them.

    Washington and others fight against taxes charged from the British empire. With active support from Russian empire. How many heads slashed with this battle?

  • jarjar Patron Provider, Top Host, Veteran

    @jenkki said:

    @jar said: I must admit, I've found that people in Europe don't like it when I respond to demands that I follow their laws with "Send troops." July 4, 1776, some people did something. Literally the short version of why any country has a military is to prevent other countries from imposing their own laws on them.

    Washington and others fight against taxes charged from the British empire. With active support from Russian empire. How many heads slashed with this battle?

    Let's face it, we all know Germany will start world war 3. Twice is a pattern.

    Someone is going to take this seriously, I should probably let them it'd be funny.

    Thanked by 1TimboJones
  • donlidonli Member
    edited October 2021

    @jar said:

    Let's face it, we all know Germany will start world war 3. Twice is a pattern.

    Well if you're gonna go there...

    (RIP Norm)

    Thanked by 3jar MannDude RIYAD
  • user54321user54321 Member
    edited October 2021

    @jar said:
    Interestingly they didn't say Hetzner US LLC though in the email. That's one of many reasons the language doesn't make sense.

    Well beeing customer of a other company from one invoice to the other without any notice would be rather questionable don't you think?
    Even Amazon, Google and so on do notify their users about this changes while doing their company shuffles to avoid taxes.

    Thanked by 1jar
  • @PUSHR_Victor said: It is indeed confusing. It is the opposite of what you state actually.

    I should change my initial post:

    I had a discussion with a friend of mine who supplies services to UK, now outside EU law, and he was confused whether he should charge VAT or not.

    Now we are both confused.

  • verovero Member, Host Rep

    @jar said:

    Let's face it, we all know Germany will start world war 3. Twice is a pattern.

    Bombing and running away won't work for you in case with taxes.

  • ArkasArkas Moderator
    edited October 2021

    @jar said: When you're in someone else's house you have to follow their rules. Hopefully tomorrow they'll let me know who thinks they're in what house and why. Stay tuned for the details ❤️

    Yes, but in the digital world, when are you considered to be in someone's house? At what exact point are you inside? When your IP is recorded? When your address is entered? When your CC is charged?
    Also, doesn't that make me a guest in said house and not a resident? Why am I then paying taxes?
    Man, I don't even know where I am anymore lol

    Thanked by 1jar
  • verovero Member, Host Rep

    More of fresh news from Hetzner..

    On the first of August 2021 we adjusted the price for newly created IPv4 Floating IPs, increasing it to €3€ (excl. VAT) per month. We did this to account for the increasing prices for buying and leasing IPv4 addresses which are driven by the global IPv4 shortage.

    Unfortunately, we also need to apply this pricing to Floating IPs (IPv4) created before that date.

  • ArkasArkas Moderator

    The news gets better each day...

  • @jar said: Let's face it, we all know Germany will start world war 3. Twice is a pattern.

    If 1813 and 1945 not enough for them, they can try out :smiley:

    Thanked by 1jar
  • vyas11vyas11 Member
    edited October 2021

    @jenkki said:
    Delaware state provide fake business registration for money. Remind me ReadyDedis Indian provider who register LLC in US even not a visiting they physically. And he will start charge taxes from US clients with it? That absurd.

    Interesting - by your logic, that makes Equinix also a fake company
    https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=EQIX

    And over 2/3 of Fortune 500 companies are fake. Apple and Cocal Cola included. Btw- Apple hoards money in Ireland - so are they a fraud Irish company who avoids paying billions of dollars in tax in the US?

    https://www.irishtimes.com/business/apple-s-cash-mountain-how-it-avoids-tax-and-the-irish-link-1.3281734

    Speaking of fakes, then there's Haliburton. Moved global HQ to Dubai to escape litigation? While still incorporated in... Delaware!!
    https://www.nytimes.com/2007/03/11/business/12halliburtoncnd.html

    Amazon in India is incorporated as Amazon Seller Services Private Limited.
    They charge me GST on purchases. I don't see Jeff Bezos physically visiting India (he last did in 2015) to set up office. Step outside the little ditch you hover in, or your head out of your ass, as the case may be. The world is far wider and complex that you think it is.

    If you have an axe to grind, or have a problem with the laws, take it up with your elected representatives to change the damn laws.
    https://thehustle.co/why-delaware-is-the-sexiest-place-in-america-to-incorporate-a-company/

    Thanked by 2raindog308 adly
  • yoursunnyyoursunny Member, IPv6 Advocate

    Change your billing address to Antarctica.
    No sales tax here.

  • vyas11vyas11 Member
    edited October 2021

    @yoursunny said:
    Change your billing address to Antarctica.
    No sales tax here.

    Interesting point- but Income Tax is not exempt

    UK: https://www.bas.ac.uk/wp-content/uploads/2015/04/bat-tax-faqs.pdf

    US:
    Antarctica workers frozen out of US tax break

    WASHINGTON: Antarctica may be a great place to avoid the heat and the crowds. For US citizens living there, one thing can’t be avoided: taxes.

    The US Tax Court ruled that the approximately 1,100 workers at the Amundsen-Scott South Pole Station, McMurdo Station or other areas on the southern continent don’t qualify for a longstanding exemption for Americans living abroad.

    At issue in the tax cases is whether Antarctica qualifies as a foreign country for purposes of a 50-year-old law that allows Americans living abroad to exclude part of their income from US tax. Most of the cases date to 2001 and 2002, when the exclusion amount was capped at $80,000; the amount is now indexed for inflation and was $82,400 in 2006.

    “As Antarctica is not a foreign country for purposes of the code, we conclude that petitioner is not entitled to exclude the wage income he earned in Antarctica,” Judge Juan F Vasquez wrote in one of 15 cases with identical rulings released in the last month.

    As far back as the 1960s, US tax courts have held that Americans working in Antarctica must pay taxes as if they were in the continental United States, Vasquez said in his ruling. Tax regulations classify work in Antarctica as “space or ocean-related” activity.

    The US generally taxes citizens on their worldwide income. To qualify for what is known as a Section 911 exemption, US citizens must live outside the country for an entire tax year, or 330 days in any 12-month period. US citizens are required to pay taxes in the country where they are living.

    The IRS decision particularly vexes some Raytheon Co workers who also filed claims in labour court demanding overtime pay. That court ruled that Antarctica is a foreign country, and is therefore not subject to the US Fair Labour Standards Act.

    “There can be no disagreement over the proposition that Antarctica is ‘foreign’ to the United States,” the 2004 ruling by US District Judge Joseph Tauro said. That case cited an earlier Supreme Court ruling that said the “ordinary meaning of ‘foreign country’ includes Antarctica, even though it has no recognised government.”

    “So, according to US law, Antarctica is not a foreign country, allowing taxes to be collected. But Antarctica is a foreign country when it comes to giving Raytheon a break in labour costs,” said Nicholas Johnson, who was a party in both lawsuits. Johnson says he’s returning to Antarctica tomorrow for another year of work.

    Seven countries — the United Kingdom, New Zealand, Australia, Norway, Chile, France and Argentina — have made territorial claims in Antarctica, said Christopher Joyner, a government professor at Georgetown University who has written several books about Antarctica. None have been recognised by any other country. In 1959, 12 states agreed in a treaty to use Antarctica only for peaceful purposes. Since then, 33 other nations have signed on. Since there is no recognised government, no taxes are levied in Antarctica.

    The cases were almost all filed by Colorado residents working for Raytheon Support Services Co., under contract with the National Science Foundation at McMurdo Station on Ross Island in Antarctica.

    Larry D Harvey, an Englewood, Colorado, attorney who filed about 160 of the cases, said he was disappointed by the courts’ rulings. “I thought we had reasonably good arguments,” he said in an interview.

    The cases have parallels to a batch filed by Raytheon employees earlier in the decade who had worked on Johnston Island, a 591-acre, US-owned South Pacific atoll located about 700 miles southwest of Hawaii. Courts ruled against those workers.

  • yoursunnyyoursunny Member, IPv6 Advocate

    @vyas11 said:

    @yoursunny said:
    Change your billing address to Antarctica.
    No sales tax here.

    Interesting point- but Income Tax is not exempt

    Income tax is applicable if only you are US/UK citizen.
    Antarctica citizen or Jupiter citizen doesn't pay income tax.

  • jenkkijenkki Member
    edited October 2021

    @vyas11

    If you join Antarctic penguin's team there no tax for you. Only fresh fish every day.

    Thanked by 2yoursunny tux
  • vyas11vyas11 Member
    edited October 2021

    @jenkki said:
    @vyas11

    If you join Antarctic penguin's team there no tax for you. Only fresh fish every day.

    Wrong again. You really need to get your head out of your ass to understand how economics, labor laws and taxation works.


    I. If the fish are handed out for gratis by a government agency, it will be construed a doleout. And doleouts are added to income therefore taxable.

    II.
    If handed over by a private sector entity, then they will claim it as
    a. Goodwill
    or
    b. Tax exempt charity
    or
    c. Expense it under Corporate Social Responsibility

    Therefore the recipient of the fish will actually get less fish than they should have. i.e. taxed again!

    III.
    If the Private sector company (or government agency or NGO) claims the fish was paid as compensation (either as other guaranteed compensation or on the job perks) then the taxman/woman will assess a fair market value of the fish and demand that you either:
    a. Pay them the proportionate amount of fish as tax
    b. Monetary equivalent of the fish

    IV. If you declare no income and expect the fish "for free forever" then... well that's how most people do or expect, therefore there will be a lot of competition for the fish. Chances of getting a fresh fish everyday are low.
    Frozen, maybe - depending on the season. But fresh- no.

    V. If you catch the fish yourself, depending on the species- Gentoo, Emperor... the income level will be assessed similar to point III. Kaching ! for the taxman.

    Only possible options remains to register as a fish selling business, don't make sales, take a writeoff, eat the fish, carry forward the losses... you get the picture. I may have to hire a former banker or an airline executive to pull this off. In addition to a lawyer and an accountant. Who will pay them? Unless they accept fish in lieu of services offered. You see, very, very fishy business.

    All said and done, my dog loves fish so he will eat it happily. Unless someone mines bitfish.

  • jenkkijenkki Member
    edited October 2021

    @vyas11 said: vyas11

    Don't forget about natural arse-cooling.
    Warning: When they cook fish, they sometimes burn it

  • raindog308raindog308 Administrator, Veteran

    @jenkki said: Delaware state provide fake business registration for money.

    No they don't.

    You can register a foreign (as in out of state) corporation in Delaware...just as you can in all 50 states to my knowledge.

    There are certain advantages to registering in Delaware, mostly around tax advantages and lots of expertise dealing with thorny corporate cases (i.e., since Delaware has such a huge number of large companies registered there, their court system are well-equipped to handle issues that arise typically in large companies, as opposed to some other random state).

    No, you can't legally commit fraud in Delaware which is what you're implying.

    Thanked by 2adly bulbasaur
  • raindog308raindog308 Administrator, Veteran

    @vyas11 said: All said and done, my dog loves fish so he will eat it happily.

    Holy crap (crappie?), so does mine. And the two before her. The stinkier, gamier, smellier the better. All of my dogs (all German Shepherd Dogs) have preferred fish over any other kind of meat.

    Used some anchovies in the kitchen once with my previous dog and wasn't sure I was going to make it out of there alive.

    Thanked by 1vyas11
  • jenkkijenkki Member
    edited October 2021

    @raindog308 said: No, you can't legally commit fraud in Delaware which is what you're implying.

    No, I don't commit fraud or implying. Just talking about a facts. Why hosting companies from India and few other countries went to register their business in US when even never physically visiting country of registration. And brave with it in first place. Make sounds bigger or still under colonization with no national pride?

  • vyas11vyas11 Member
    edited October 2021

    @raindog308 said:

    @vyas11 said: All said and done, my dog loves fish so he will eat it happily.

    Holy crap (crappie?), so does mine. And the two before her. The stinkier, gamier, smellier the better. All of my dogs (all German Shepherd Dogs) have preferred fish over any other kind of meat.

    Used some anchovies in the kitchen once with my previous dog and wasn't sure I was going to make it out of there alive.

    Cool! I have a lab/Shepherd mix. Indeed - the stinkier, the smellier, the better! Fortunately he is not allowed in the kitchen's cooking area so I may be tempted to experiment with anchovies.

    (So long and) Thanks for (all) the fish tip!

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