or Connect
AppleInsider › Forums › General › General Discussion › European Commission to investigate Apple's Ireland tax haven - report
New Posts  All Forums:Forum Nav:

European Commission to investigate Apple's Ireland tax haven - report - Page 2

post #41 of 79
Quote:
Originally Posted by RichL View Post

Apple stays in California because it's easy to attract the calibre of employee they need to California. It's easy to move manufacturing jobs to Texas. because it's an employer's market. It's less easy to move engineering jobs because it's an employee's market.

California keeps its taxes high because it knows that it has more to offer than just low taxes. It's only shit-hole states that no-one wants to live in that have to lower their taxes to attract business.

The same applies to Europe. 

Just Ireland, in general European's pay more in tax's then the US does, do to our social programs, check out how much Sweden pays it will make your head spin.
When I looked up "Ninjas" in Thesaurus.com, it said "Ninja's can't be found" Well played Ninjas, well played.
Reply
When I looked up "Ninjas" in Thesaurus.com, it said "Ninja's can't be found" Well played Ninjas, well played.
Reply
post #42 of 79
Quote:
Originally Posted by Relic View Post

Just Ireland, in general European's pay more in tax's then the US does, do to our social programs, check out how much Sweden pays it will make your head spin.

Hungary is even 2% higher, @ 27%
http://en.wikipedia.org/wiki/Value_added_tax#EU_countries
I’d rather have a better product than a better price.
Reply
I’d rather have a better product than a better price.
Reply
post #43 of 79
Quote:
Originally Posted by RichL View Post
 

 

Apple stays in California because it's easy to attract the calibre of employee they need to California. It's easy to move manufacturing jobs to Texas. because it's an employer's market. It's less easy to move engineering jobs because it's an employee's market.

 

California keeps its taxes high because it knows that it has more to offer than just low taxes. It's only shit-hole states that no-one wants to live in that have to lower their taxes to attract business.

 

The same applies to Europe. 


Blah I meant to respond to this one too. Note that a large percentage of it is around Austin, which isn't a highly "conservative" (I hate that term, but I can't think of a better word here) area. It lacks the beautiful weather and nice beaches of California, and in terms of cities I prefer San Francisco. Seattle is a very nice city with a number of tech companies and other corporate hubs, yet it has a very low tax rate. There are a lot of things that contribute to these issues. Some of California's big cities have suffered severe mismanagement at times and wasteful spending on insolvent projects. Some of San Diego's construction projects come to mind. Los Angeles suffers from being extremely spread out combined with problems in trying to improve public transportation due to lack of space for more freeways. Most of them go around the important areas, and getting into downtown for either the garment or financial districts is a mess. They're not all easily solvable problems, but California has enough debt and expenses that they lack a viable alternative. The nice things about the state keep people here, but they aren't the direct cause of its tax rates. Another part you might not know is that California has unusually low property tax rates. They cannot rise more than 2% per year unless the property changes ownership. There was also some temporary relief in that area enacted around the time of the housing crisis. That is made up elsewhere via corporate and  personal state income tax as well as the state portion of sales tax (municipalities sometimes add onto that). It's also important to note that if you own a registered business, you typically owe local tax, even though many grant things like small business exemptions under an arbitrary level of gross receipts.

 

Blah that got pretty long, but I figured you may not be aware of all of that if you reside in the UK.

post #44 of 79
Quote:
Originally Posted by SpamSandwich View Post

Yes. Buy it, sell off the assets and shut it down.

That was my thought too ... 1biggrin.gif
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
Google Motto "You're not the customer. You're the product."
Reply
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
Google Motto "You're not the customer. You're the product."
Reply
post #45 of 79
Quote:
Originally Posted by Tallest Skil View Post

What, uh… what happens if Italy collapses?

Because I’ve heard things. Not about Italy–well, yes, about Italy, but that’s not what I mean–but about the EU in this regard.

What happens to the Eurozone if one, two, three of its members collapse?

Dude, if Apple bought it Tim would be running things ... no worries. 1smoking.gif
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
Google Motto "You're not the customer. You're the product."
Reply
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
Google Motto "You're not the customer. You're the product."
Reply
post #46 of 79
Quote:
Originally Posted by gimarbazat View Post

When you have so much money that you don't know what to do with and only pay 2% tax there's something wrong
The 2% is more myth than fact.

It is more like 0.25%.
post #47 of 79
Quote:
Originally Posted by PhilBoogie View Post

Hungary is even 2% higher, @ 27%
http://en.wikipedia.org/wiki/Value_added_tax#EU_countries

Wow, Budapest is defiantly one of my favorite cities. Because going to the dentist is so freaken expensive here, we have what we call holiday teeth repair trips, in which you go for a three day vacation in Budapest for the sole purpose of seeing the dentist. When I was healthier I used to go twice a year with the kids.
When I looked up "Ninjas" in Thesaurus.com, it said "Ninja's can't be found" Well played Ninjas, well played.
Reply
When I looked up "Ninjas" in Thesaurus.com, it said "Ninja's can't be found" Well played Ninjas, well played.
Reply
post #48 of 79
Quote:
Originally Posted by hmm View Post

 

Blah that got pretty long, but I figured you may not be aware of all of that if you reside in the UK.

 

I wasn't so thanks!

post #49 of 79
Quote:
Originally Posted by digitalclips View Post

Apple should just buy the EU. 1wink.gif

 

Apple does not want to choke to death. 1wink.gif

post #50 of 79
Quote:
Originally Posted by Tallest Skil View Post
 

What happens to the Eurozone if one, two, three of its members collapse?

 

They won't let that happen. See the example of Greece.

post #51 of 79
Quote:
Originally Posted by Relic View Post


Wow, Budapest is defiantly one of my favorite cities. Because going to the dentist is so freaken expensive here, we have what we call holiday teeth repair trips, in which you go for a three day vacation in Budapest for the sole purpose of seeing the dentist. When I was healthier I used to go twice a year with the kids.


Off topic: I heard the same thing about some Balkan countries as well. Much cheaper than EU zone, but also (much?) more risky from a sanitary point of view. What about Hungary? Is it considered good enough by EU standards in this sector?

post #52 of 79
Quote:
Originally Posted by hmm View Post

That is an overly simplified view of it, because demand isn't entirely elastic. Using a rather extreme example, Apple could in theory price each iphone at $10k today. This would offer a higher gross margin per device, but it's unlikely that they would sell enough of them to maintain a viable product line. Changes in taxes can affect the price paid, but it isn't the only factor. They do in fact have to balance what is considered an acceptable margin against how many would sell at that price. It would be different if the devices were right on the edge of being profitable where a few percentage points could push them into a loss. That isn't the case here, so they have a certain amount of leeway when it comes to pricing structure. Apple much like other companies also rounds to certain price points, so any impact on costs must be great enough to motivate a pricing difference of $50 or $100 depending on the price range of that product.

How is it a simplified view? Sales tax is added as a percentage of the sellers price, and the customer pays it, no matter what the price is, the customer pays the sales tax
post #53 of 79
Quote:
Originally Posted by jfanning View Post


How is it a simplified view? Sales tax is added as a percentage of the sellers price, and the customer pays it, no matter what the price is, the customer pays the sales tax


Oh sorry I thought we were including other taxes as well given the discussion. By that I mean that people often mention that people are the ones who pay corporate tax, which is why I said it's one of many factors in determining final pricing. Anyway you are correct. Sales tax is paid for directly by the consumer, although it sometimes influences purchasing habits. I didn't mean to imply otherwise.

post #54 of 79
Quote:
Originally Posted by jfanning View Post

For the hardware Apple doesn't pay tax, the customer does. Same with income tax, the employees pay that.

I meant corporate income tax. Of course they give sale tax back to the appropriate gov.
post #55 of 79
Maybe the better way is for nation states to sell access to its consumers, like apple does to its developers. Charge, say 30% for each transaction executed by an organisation against one of its citizens and be done with it.
post #56 of 79

It could become a problem for such companies in the UK. A well known coffee chain recently had to give in over this in response to public opinion, once their tax evasion 'scam' was given publicity in the press. As 'gimarbazat' says, it's not as if Apple is short of cash.

post #57 of 79
Quote: @herbapou
 

"For hardware, the way I understand it Apple pays its tax in every EU countries then send the money into Ireland. So its a cash placeholder and it affects US Tax not EU tax. Ireland is a good place to hold cash because Apple can invest its cash and only pay 2% in tax to Ireland on the interest it makes.

For software and services, its another story, it looks like Apple is dodging EU taxes for everything itunes related.

The EU may have a case on itunes sales, but on hardware sales I dont see anything wrong with this."

 

It's not about hardware vs. software, nor is it "dodging" ...It's about physical location of sales. As far as VAT anyway, the following holds true (and I would imagine that other taxes would be similar) :

 

If the location of sales is a physical store within an EU country -- ie, a brick-and-mortar Apple Store or reseller, then the sale is booked in that country. If the sale is online, then it doesn't matter what country the buyer is in: the sale is made where the vendor has set up for the region (in this case, Ireland -- and the product is shipped from Ireland, anyway). It is not "dodging" to say that your online sales mechanism is based in and originates in Ireland. And of course, most of Apple's EU sales will be online sales, not made at physical stores.

 

I have a business in the Netherlands. I offer web services, and my business is conducted online. I have customers around the globe. If my customer is based in the EU, then I am obligated, as a Dutch resident, to charge him VAT -- at the Netherlands rate, for the Netherlands, not at my customer's national rate. My UK customer is contributing to VAT for the Netherlands. If my customer is outside EU, I do not add VAT. Just because Apple has an /nl online store doesn't mean it has anything to do with the Netherlands physically; whereas my "UK" services are subject to NL tax, because that is where I reside. Likewise, I file and pay corporate tax in NL, not in UK, even if I have customers there... because I do my work in the Netherlands, (even if I host a site in the UK -- in which case the host is subject to UK tax).

 

As an EU resident, you pay the VAT in the vendor's location. This is an EU wide agreement. Likewise, wouldn't the vendor pay corporate tax only in his location? It seems very simple.


Edited by krabbelen - 6/11/14 at 7:45am
post #58 of 79
Quote:
Originally Posted by Misa View Post


If that's the case, then that seems to explain the "region locking" by store pushed by Apple, Nintendo, Microsoft, Steam, etc is to force the taxes and royalties to be paid to the correct countries media monopoly and tax system. Think about it. If the taxes are the lowest in Ireland, everyone in the EU would buy from the Ireland iTunes store.

It isn't that simple.  Legally the iTunes Store for the EU is in Luxembourg, because in Luxembourg the VAT is the lowest in the EU.  Everybody is the EU buys from the same iTunes Store in Luxembourg.  But in order to minimize taxes on the profits made, Apple Luxembourg is not the "owner" of the iTunes Store, it is a reseller with minimal margin from Apple Ireland.  So the profit is made in Apple Ireland. Ireland has a loophole in its tax laws for non tangible goods, saying the profits are only taxed in the country of production, which is the US.  But because the profit never is booked in the US, no US taxes are imposed.

 

Conclusion: Apple (and other companies), evade on a legal manner taxes on the profit of Software goods sold in the EU.  Apple is perfectly allowed to do this, but whether this is morally acceptable or not, is another matter.

post #59 of 79
Quote:
Originally Posted by cropr View Post
 

Conclusion: Apple (and other companies), evade on a legal manner taxes on the profit of Software goods sold in the EU.  Apple is perfectly allowed to do this, but whether this is morally acceptable or not, is another matter.

 

Avoid, not evade.  A linguistically subtle, but semantically important difference.

censored

Reply

censored

Reply
post #60 of 79
Quote:
Originally Posted by cropr View Post

It isn't that simple.  Legally the iTunes Store for the EU is in Luxembourg, because in Luxembourg the VAT is the lowest in the EU.  Everybody is the EU buys from the same iTunes Store in Luxembourg.  But in order to minimize taxes on the profits made, Apple Luxembourg is not the "owner" of the iTunes Store, it is a reseller with minimal margin from Apple Ireland.  So the profit is made in Apple Ireland. Ireland has a loophole in its tax laws for non tangible goods, saying the profits are only taxed in the country of production, which is the US.  But because the profit never is booked in the US, no US taxes are imposed.

Conclusion: Apple (and other companies), evade on a legal manner taxes on the profit of Software goods sold in the EU.  Apple is perfectly allowed to do this, but whether this is morally acceptable or not, is another matter.

According to whose morals?
post #61 of 79
Originally Posted by gimarbazat View Post
When you have so much money that you don't know what to do with and only pay 2% tax there's something wrong

 

Yes, with you, and your comprehension of the situation.

 

Originally Posted by PB View Post

They won't let that happen. See the example of Greece.

 

It’s not a question of “letting” it happen. There will be no stopping it. Greece and Spain have fallen. If Italy falls, Germany and France won’t be ABLE to stop it.

post #62 of 79
Quote:
Originally Posted by jungmark View Post


According to whose morals?

 

Everyone who wants to have an opinion on it?  What sort of question is that?

censored

Reply

censored

Reply
post #63 of 79
Originally Posted by Crowley View Post

Everyone who wants to have an opinion on it?  What sort of question is that?

 

What sort of answer is that?

post #64 of 79
One not directed at you.

censored

Reply

censored

Reply
post #65 of 79
Quote:
Originally Posted by Tallest Skil View Post

Yes, with you, and your comprehension of the situation.


It’s not a question of “letting” it happen. There will be no stopping it. Greece and Spain have fallen. If Italy falls, Germany and France won’t be ABLE to stop it.

France can't stop anything.
Quote:
Originally Posted by Crowley View Post

Everyone who wants to have an opinion on it?  What sort of question is that?
What sort of answer is that? 1smile.gif

Not everyone has the same morals. That's why we have laws. It's perfectly legal for Apple and others to avoid taxes this way.
post #66 of 79
Quote:
Originally Posted by greatrix View Post

It could become a problem for such companies in the UK. A well known coffee chain recently had to give in over this in response to public opinion, once their tax evasion 'scam' was given publicity in the press. As 'gimarbazat' says, it's not as if Apple is short of cash.

It's blackmail and Apple should tell the EU to FOAD.

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #67 of 79
Quote:
Originally Posted by SpamSandwich View Post

It's blackmail and Apple should tell the EU to FOAD.

The EU is not after Apple. It's all explained in the other thread.
http://forums.appleinsider.com/t/180559/european-union-announces-tax-evasion-investigations-of-apple-fiat-starbucks#post_2548839
melior diabolus quem scies
Reply
melior diabolus quem scies
Reply
post #68 of 79
Quote:
Originally Posted by Tallest Skil View Post
 

It’s not a question of “letting” it happen. There will be no stopping it. Greece and Spain have fallen. If Italy falls, Germany and France won’t be ABLE to stop it.

 

This is what I thought also but the European reality has been proved much more complex.

post #69 of 79
Quote:
Originally Posted by SpamSandwich View Post

It's blackmail and Apple should tell the EU to FOAD.
The case being referred to was not blackmail by the government, it was pressure from a public backlash that threatened sales. If a similar backlash were to raise against Apple then they could tell the buying public to FOAD if they want, but I doubt it'd work out well for them.

censored

Reply

censored

Reply
post #70 of 79
Quote:
Originally Posted by jungmark View Post

Not everyone has the same morals. That's why we have laws. It's perfectly legal for Apple and others to avoid taxes this way.
No one claimed otherwise, and the post you quoted explicitly said the exact same thing about legality, which is why it was a redundant question.

censored

Reply

censored

Reply
post #71 of 79
Originally Posted by Crowley View Post
One not directed at you.

 

Good for you. Maybe you shouldn’t have posted it publicly, then.

 

Originally Posted by jungmark View Post
France can't stop anything.

 

You know, I’ve heard that. Germany seems to be pulling the dead weight of the entire Eurozone behind them. How much longer will they put up with that?

post #72 of 79

If the commission is just looking to get in on Apple's cash then the right thing to do is to legislate, not try to rob them after they followed the laws that had been set up.  If you expect corporations to not seek the setup with the lowest tax burden then you operate under a world view that is strange to me.

 

I still have never been able to understand why some people think it's ok to look at a successful person or business and think to themselves, "I deserve the reward for their work, simply because I have less than they do."  Wanting it is envy.  Thinking you deserve it is a breakdown of some mental faculty.

You did not come into the world to fail. You came into the world to succeed.

- Gordon Hinckley

Reply

You did not come into the world to fail. You came into the world to succeed.

- Gordon Hinckley

Reply
post #73 of 79
Quote:
Originally Posted by jinglesthula View Post

If the commission is just looking to get in on Apple's cash then the right thing to do is to legislate, not try to rob them after they followed the laws that had been set up.
http://forums.appleinsider.com/t/180547/european-commission-to-investigate-apples-ireland-tax-haven-report/40#post_2549051
melior diabolus quem scies
Reply
melior diabolus quem scies
Reply
post #74 of 79
Quote:
Originally Posted by greatrix View Post
 

it's not as if Apple is short of cash.

 

if someone has 'enough' then it's ok to take it from them by force?

You did not come into the world to fail. You came into the world to succeed.

- Gordon Hinckley

Reply

You did not come into the world to fail. You came into the world to succeed.

- Gordon Hinckley

Reply
post #75 of 79
Quote:
Originally Posted by Tallest Skil View Post

Good for you. Maybe you shouldn’t have posted it publicly, then.
Why not? It hasn't brought me any harm. I'm not offended by you answering me with your usual snide and clueless condescension, I just have no interest in engaging with you.

Toodles!

censored

Reply

censored

Reply
post #76 of 79
The problem for the EU is that if these companies like Starbucks continue to be allowed to trade, the whole tax regime folds.

They need to get serious. Interestingly, because of the large scale tax evasion a good percentage of the UK population rightly boycott Starbucks. The reason being that Starbucks undermines the UK economy.
post #77 of 79

It is the duty of all citizens, businesses and corporations to pay their taxes. See eBeliefSystem's comment, above. Also, could those childish commentator's making inane, rude even, remarks, please desist, it doesn't reflect well on them and annoys everyone else.

post #78 of 79
Quote:
Originally Posted by greatrix View Post

It is the duty of all citizens, businesses and corporations to pay their taxes. See eBeliefSystem's comment, above. Also, could those childish commentator's making inane, rude even, remarks, please desist, it doesn't reflect well on them and annoys everyone else.

Depends on which special interest has pushed through their tax increase or exemption, doesn't it?

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #79 of 79

Here is an ABC of the situation.

The special interests concerned in this case are the US treasury, The Irish and British Governments and Apple, an incredibly rich, highly sophisticated  knowledge based company that operates in all three countries.

Each of those countries, for better or worse, have their own tax laws. Apple is not alone amongst large trading companies in seeking to find ways of avoiding paying taxes in the countries it operates in, largely through loop holes in the taxation laws of those countries. The bigger the company, the more they can spend on lawyers in order to avoid paying tax. Little people like me and, I assume, you, do not have that facility. It is us, the little people, who have to pay taxes through the nose for public services, pensions, the military and police, etc. out of our own pockets. Don't get me wrong, Apple products are all over my desk. They are great products, but that does not mean that Apple et al

should be able to get away with avoiding paying their dues.

OK?

New Posts  All Forums:Forum Nav:
  Return Home
  Back to Forum: General Discussion
AppleInsider › Forums › General › General Discussion › European Commission to investigate Apple's Ireland tax haven - report