Re: [Debconf-team] [Debconf13-localteam] DebConf 13 legal association

[Daniel Pocock <daniel@pocock.com.au>]

On 31/08/12 13:56, Holger Levsen wrote:
> On Freitag, 31. August 2012, Daniel Pocock wrote:
>> In Switzerland, DebConf's worst case scenario is that every foreign
>> sponsor and every person paying the professional rate will be charged
>> VAT (about 8%).  Swiss companies who sponsor DebConf will get a rebate
>> of the 8% VAT on their tax return, but foreign sponsors can't get that
>> money back, so it is just lost and the fundraising people have to work
>> harder to get more sponsors.
> 
> ouch.


I'm not suggesting it is inevitable - I'd just like to see the situation
documented

If there is an unavoidable tax on all sponsors, it may fall under the
theory of tax incidence:

  http://en.wikipedia.org/wiki/Tax#Deadweight_costs_of_taxation

"This causes fewer transactions to occur, which reduces economic
welfare; the individuals or businesses involved are less well off than
before the tax."

In other words, if a sponsorship package costs 10,000 CHF, we might get
20 sponsors if the tax did not exist, but if a tax does exist, "fewer
transactions" means we only get 17 or 18 sponsors - yet under this
theory, not only is there less money in the bank, but the fundraising
volunteers are making exactly the same amount of effort as in the
scenario where 20 sponsors are found.

So looking a little deeper into the tax situation and maybe even paying
for some consultant, if necessary, may be helpful.

That said, most countries also offer subsidies (which are obviously the
opposite of taxes) to bring in international events - so if there is a
tax, but there is also some subsidy, and if they balance out, it is all OK.