On way the American government disincentivizes hiring Americans: If I hire a remote US employee, I have to pay payroll taxes, their healthcare, and may deal with multi-state nexus issues. If I hire a remote foreign employee, there are no employer side payroll or tax issues.
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Depends on the other country though. If you hire a German he will price in these things into the salary he asks for because he has to pay them in Germany. So isn't it more about tax evasion in other countries and the reserve currency effect?
I don’t think so. Healthcare is cheaper in Germany and since the typical remote worker countries are not Germany, they are countries where tax evasion is the norm, the US should do something about this for their citizens.
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About tax evasion specifically, the receiving country’s policies are kind of irrelevant. The us has an obligation to put its own people on at least equal footing tax wise.
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That's true, but how would you achieve that? Historically the USA would try to influence policy in other countries via the IMF/World Bank but i think that's less of an option now. Local policy-wise, you could put a tariff on remote work. Is there any other way?
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I agree that Germany is atypical and tax evading countries are more typical. But i don't think the overall tax burden is less in Germany even though healthcare specifically is cheaper.
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It's less for the US company, that's for sure.
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