>>70568409>why would it matter what Cover does next it’s not their business.Because then Google would be taking the wrong amount away from the money they owe the streamer/Cover and would be sending the incorrect amount of tax to whichever government they were sending it.
Corporations are (theoretically) usually taxed at a lower rate than individuals. And higher earners are usually taxed at higher rates. Additionally different countries have different tax rates with Japan's being relatively high compared to the US.
First, the tax rate for corporations in Japan is 23% or something. And for individuals, it ranges from 5-45% depending on the bracket. However non-residents, i.e. non-permanent residents, are subject to a flat rate of around 20%. And I have no idea how foreign talent living outside of Japan working for Cover as are classified.
So under your tax scheme, the talent's channel makes $x and then Google after taking their 30% cut, deducts taxes from the remainder based on the details of where they're sending the money. So in this case, Google deducts 23% because they are sending it to a Japanese corporation. So Cover receives $0.7 * 0.77x for the channel income.
Then, Cover gives 50% of that to the talent, along with whatever other remuneration earned through the talent's cut of merch, sponsorships, etc which we'll call $y.
Thus the talent's income is supposedly 0.7*0.77*0.5x + y =~ 0.27x + y, which they then report to wherever they live and pay the correct amount of tax on that income. Under such a system, all members' channel earnings actually ARE taxed twice. Once when google sends it to Cover, and once when they report their total income.
So for example, for Mori, as a Japanese non-resident, she is taxed at a flat rate of 20%, not including local municipal taxes.
That means that she is taking home a total of $ 0.80*(0.27x + y) after paying her Japanese taxes.
If Google didn't automatically take 23%, Mori would be taking home $ 0.80*(0.35x + y). So she is being taxed twice because part of her income is being unfairly taxed as corporate income.
Finally, the tax she pays to Japan is announced in her filing to the US and that amount is deducted from the amount she owes the IRS under the tax credit system established by treaties between the US and Japan. Mori did not know about this last step and thought she was being taxed by both the US and Japan, and that's what she was talking about when she said she was being double taxed.
TL;DR: Mori was wrong about being taxed twice by the US and Japan. However, if you are correct, and Google automatically deducts taxes from the amount it sends Cover, then Mori actually is being taxed twice on her channel earnings and thus only taking home around 22 cents per every dollar her channel earns. This is probably what she meant when she said that she was losing 70-80% in taxes for every superchat.
