Apple & Ireland's appeal of $16B EU tax ruling expected this fall, payments expected to st...

Posted:
in General Discussion edited April 24
Apple and the Irish government's appeal of a $16 billion European Commission ruling on back taxes should finally see action later this year, according to Ireland's finance minister.

European Competition Commissioner Margrethe Vestager


The case is likely to be heard in the fall, said Paschal Donohoe on Tuesday, quoted by Reuters. The minister didn't offer a precise date, or what legal strategy Ireland might adopt.

Apple is expected to start paying into the escrow fund in May, according to Politico. The Irish finance ministry said that it agreed on a "significant milestone" on Tuesday towards collecting the money, with the full amount expected by the end of the third calendar quarter of 2018.

In August 2016, the European Commission ordered Ireland to collect billions in back taxes, arguing that the country had extended preferential tax treatment to Apple. Under E.U. law, benefits offered to one company must be available to others -- otherwise, it can constitute illegal state aid.

Apple has funneled large sums of international revenue through Ireland, using loopholes to pay minimal taxes. According to the Commission, Apple paid 1 percent on profits in 2003, and as little as 0.005 percent in 2014. The Irish government is even accused of reverse-engineering rules on the fly to ensure Apple got favorable rates, presumably worried that the company would divert jobs and investments without white glove treatment.

In testimony and elsewhere Apple and Ireland have denied any wrongdoing, claiming they followed all applicable laws. Nevertheless the latter has begun closing some loopholes, and the Commission has proposed new tax rules that would scatter Apple's payments around the E.U.

Some critics have accused Apple of violating the spirit of the law, and/or depriving government services of badly-needed revenue. In France the company has been met with repeated protests along those lines.

Comments

  • Reply 1 of 10
    $16 billion - uhm - yes, that’s worth appealing
    jony0
  • Reply 2 of 10
    rob53rob53 Posts: 1,942member
    Some critics have accused Apple of violating the spirit of the law, and/or depriving government services of badly-needed revenue. In France the company has been met with repeated protests along those lines.
    In other words, the EU countries continue to demand foreign aid from the US, this time directly from a US-based company. Sounds normal to me. 
  • Reply 3 of 10
    xbitxbit Posts: 221member
    rob53 said:

    In other words, the EU countries continue to demand foreign aid from the US, this time directly from a US-based company. Sounds normal to me. 
    In other words, a US company has taken advantage of EU infrastructure and resources without paying its fair (according to the law and backed in several courts) amount of tax to each EU nation. The EU are seeking to end this corporate welfare scam.
    muthuk_vanalingamsingularityavon b7jony0propod[Deleted User]GeorgeBMac
  • Reply 4 of 10
    stukestuke Posts: 74member
    Of course ANY company will take advantage of tax breaks. Their a company first...to make money. Welfare to the state is defined BY THE STATE (government body) and if it had rules to which Apple effectively had to pay its taxes at 0.005% in 2014, then that’s what Apple did. 

    Do you opt to pay more than what the rules tell you in your personal taxes, in the name of welfare to the State?
    rob53jony0
  • Reply 5 of 10
    rob53rob53 Posts: 1,942member
    xbit said:
    rob53 said:

    In other words, the EU countries continue to demand foreign aid from the US, this time directly from a US-based company. Sounds normal to me. 
    In other words, a US company has taken advantage of EU infrastructure and resources without paying its fair (according to the law and backed in several courts) amount of tax to each EU nation. The EU are seeking to end this corporate welfare scam.
    We only have information on how much tax Apple paid as determined by the EU. I don't remember ever seeing any tax information from Ireland. The articles I've read all point to the EU commission as trying to force Apple to pay taxes on previous sales after altering the tax laws (or even bothering to apply it). If anyone is at fault, it's Ireland since they set the tax rate for Apple, which Apple has paid.

    As for giving preferential tax treatment, that's common in the US and is probably common throughout the EU. It doesn't matter if it's for a US company or foreign owned. Ireland gave Apple better tax rates along with any other large company that asked for them. The EU is going broke and is mismanaged so they're simply trying to find ways to collect from whoever they can.
  • Reply 6 of 10
    "The Irish government is even accused of reverse-engineering rules on the fly to ensure Apple got favorable rates, presumably worried that the company would divert jobs and investments without white glove treatment."

    WTF does that even mean?  I'm pretty sure Ireland wouldn't need to "reverse engineer" its own rules.  It might change them, but that's not what that term means.
    SpamSandwich
  • Reply 7 of 10
    singularitysingularity Posts: 1,329member
    rob53 said:

    As for giving preferential tax treatment, that's common in the US and is probably common throughout the EU. It doesn't matter if it's for a US company or foreign owned. Ireland gave Apple better tax rates along with any other large company that asked for them. The EU is going broke and is mismanaged so they're simply trying to find ways to collect from whoever they can.
    Preferential tax treatment has to be done according to the rules. The accusation is that the deal between Apple and Ireland wasn't and was "illegal" state aid.
    If Apple loses then Ireland gets the money not the EU.
    [Deleted User]
  • Reply 8 of 10
    nunzynunzy Posts: 662member
    Apple should just take its cash somewhere else, like the Maldives or the Cayman Islands.   Screw Ireland.
  • Reply 9 of 10
    avon b7avon b7 Posts: 2,908member
    stuke said:
    Of course ANY company will take advantage of tax breaks. Their a company first...to make money. Welfare to the state is defined BY THE STATE (government body) and if it had rules to which Apple effectively had to pay its taxes at 0.005% in 2014, then that’s what Apple did. 

    Do you opt to pay more than what the rules tell you in your personal taxes, in the name of welfare to the State?
    0,005% on what exactly?

    Part of the EU investigation determined that it was Apple itself that decided how much to make available for taxation.

    I wonder how many other Irish companies enjoyed that privilege.

    We need to wait for this to take its course and see how things eventually pan out.
    singularity
  • Reply 10 of 10
    GeorgeBMacGeorgeBMac Posts: 3,273member
    stuke said:
    Of course ANY company will take advantage of tax breaks. Their a company first...to make money. Welfare to the state is defined BY THE STATE (government body) and if it had rules to which Apple effectively had to pay its taxes at 0.005% in 2014, then that’s what Apple did. 

    Do you opt to pay more than what the rules tell you in your personal taxes, in the name of welfare to the State?
    Ahhh!  Nice argument -- but false....

    The question is not whether Apple played by the rules and obeyed the laws -- but WHICH rules and WHICH laws.   In this case Ireland, which had agreed to be bound by EU rules and laws decided to make up its own rules and laws.   Apple took advantage those rules -- and they (Apple and Ireland) got busted.

    The analogy is:  California deciding how much Federal Tax Apple should pay -- Let's make it:  0.005%
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