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Work
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Where Am I Working?

I am sitting in New Zealand writing this. It started as an idea in my head and was typed into a local file on my computer. I copied it to WordPress (my blog hosting software of choice) and saved a draft to my People First server.

The words were then sitting on a server in Iowa, USA.

From this point on, as I edit the draft, I am in New Zealand, the words I am editing are in Iowa - where am I working?

By the time you read this post, I will have published and anybody in the world can read it.

Example, a visitor in Kenya pulls up this web site in their browser and these words are 'automagically' read in Kenya.

Question

Where is ‘the work’ done?

  • New Zealand, because that is where I tapped the original words into the computer?
  • New Zealand, because that is where I cut and paste those words into WordPress?
  • Iowa, because that is where the People First servers are?
  • Where you are reading this because until those words delivered value (you reading them), no work was done.

I ask because once you know where the work was done, you should have an idea on where you should be taxed and arguably where you should be licensed to work.

This conversation doesn’t seem to be a major part of public discourse, because the scenario is an edge case. But for how much longer?

New York has a law that says anybody working IN NEW YORK pays New York Taxes and from that emerges things like the NY, NJ and CT tri-state tax agreement.

“Like all states with broad-based income taxes, New York has asserted the right to tax nonresident income earned within its borders. But unlike most other jurisdictions with significant cross-border commuter flows—such as Illinois and Indiana or Virginia and Maryland—New York has never given nonresidents a tax pass in the form of ‘reciprocity’ with their home states.”

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But if my servers are in Iowa, my customers are in Europe, my bank account is in California and I only live in New York, should I pay New York taxes?

I write more about where we work in this week's newsletter.

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Work
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physical presence - generated by craiyon

Netflix to pay $59M to settle a tax dispute in Italy, where prosecutors claimed cables and servers used by Netflix amounted to a physical presence in the country.

If you are wondering why I put this under the ‘Work’ category - it is because I think there is a court fight waiting to happen as to where work happens.

The thinking behind this case will be funneled into the new case.

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People First
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The Future of Remote Work

Over on the podcast and in the newsletter - oh and in the People First network, I have been ruminating about remote work.

Photo by Christine Roy on Unsplash

Specifically about work visas and wondering where work is done and once you know where it is done - then - do you need a work visa?

Quick example. You LIVE in P0rtugal. You connect to servers in the US. You are paid in London. Your value is delivered (eg where the code (for example) is rendered and turned into something that can be charged for in Canada.

Where do you work?

Seems like I am not the only one, Adam Ozimek from Upwork shares his ideas about nomadic workforces with Matt Yglesias. He is really only talking about the US - but still raising valid and related questions about the other side of the where do you work equation - where do you go if you cant work. Which state?

They discuss the implications for migration, local governance, and the elusive concept of work/life balance. (Where have I heard that one before?)

Adam argues strongly for the whole work thing in America to be Federalized.

Listen to the podcast here. If you don’t have a full 60 minutes to listen - scoot through to minute 4o for the pertinent stuff.

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Work
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Where Do You Work

A response to a recent newsletter. Specifically one where I explored Work Location. (You might want to click in and have a read to get the context.)

Sometimes people have a lot to say, but they don’t join into the dialogue - nor even make comments. I get it. I really do. Another post from an anonymous reader, this time answering something I wrote in a newsletter and again - reproduced with permission from the original writer.

Photo by Kevin Bhagat on Unsplash...

Now, this is a subject that really gets to me!!

I have long argued that the biggest conflict in the world today is that between global and tribal politics. I have met anthropologists who maintain that the human-animal is basically tribal - pre-programmed by history, if not genetics, 'to want to belong'. They argue that this is at the root of all sorts of things we see today - including racism/xenophobia at the most serious level and, more prosaically, things like fashion fads, football fans, pop group mania, etc., at the daily level. However, there is, in my eyes at least, clear evidence of emerging subsets of humans who want to throw all that away in favour of seeing the world, and our species, holistically.

One rather crude indicator of this - a frequent topic in my Operations and Supply Chain Management consultancy and teaching - is the tension between global companies (not of all which are the spawn of the devil, planet-destroying, secret cabal members, but simply businesses whose raw materials, skill-base and customers cannot be defined by random, historical, “lines on the ground") and national Governments, most obviously over issues like differing tax regimes (and where it’s paid) and customs (import/export) processes.

Extend this to the individual with the option of working at very long distance from 'the office', and we see similar issues. Some 6 years ago, I did a piece of work for a Greek client, itself funded by the EU, whose direct customers were mainly from the new Eastern EU member states. HMRC was out of the traps like a top greyhound: within days I was in receipt of paperwork explaining what I needed to do to make sure that my work was taxed (and subject to National Insurance) 'here in the UK' (despite me NOT actually being in the UK), rather than in Greece. I presume the argument would be that we are a UK-registered company, I am a UK citizen and the education/experience that enabled me to win the contract were gained in the UK, some of it at University, at the taxpayer's expense. That’s fair enough. However, many of the people who would say “quite right too” are EXACTLY the same people who complain when a US company, say, elects not to be taxed in the UK on earnings made here. Yet, those companies are employing UK people, who pay (quiet a lot) of tax, when you take NI, VAT, duty etc., into account as well as direct PAYE, they are renting or buying UK property, and paying local tax on it, they are consuming UK products and services that create more jobs and tax, etc. If they moved all their operations out of the UK, would we win or lose? It’s not such an easy calculation as the 'red top fury' suggests.

So, back to your individual, living where (s)he wants to live but working for a company 'back home', or, in the extreme, in the economy that places the highest monetary value on her/his skills. Would (s)he pay tax in the country of residence, the country of origin, the country employment, or several of these? Would the value of the residence (shopping local tax, etc.) be offset against the value of direct employment taxation in deciding policy?

Or is this another nail in the coffin of nationalistic division?

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Work
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Digital Nomads

The War For Digital Nomads Heats Up As Greece Passes New Tax Law