I say make Apple Pay. They want heavy government spending, they should pay for it; their effective tax rate is too low for the biggest public company in the world.
This isn’t about making Apple pay. Ireland can change their corporate tax rate at will with passage of new Irish tax regulations.
The rate charged Apple was not a standard Irish corporate tax rate. It was a special and unique negotiated one. New tax regulations would not necessarily prevent the same result.
Apparently, the Commission failed to prove that to the court.
I'm not sure what you're asking. But Apple used Ireland as a base of operations in Europe for a number of reasons. One of those was the friendly nature of Irish tax policies. Ireland had, quite intentionally, set up its tax policy to be attractive to foreign businesses. As I indicated previously, the rule whereby non-Irish branches of Irish corporations weren't taxed on their earnings by Ireland was an outlier. It was a way by which Ireland competed with other taxing jurisdictions to attract economic activity. It allowed Apple and others to, quite legally, avoid taxation on meaningful portions of its foreign earnings.
The idea that Apple funneled profits through Ireland is just standard international tax policy stuff - nothing at all unusual or improper about that. That has to do with how governments - for a long time and for good reasons - have taxed income, as distinguishing between economic activity which occurs within their countries or as trade coming into and out of their countries. It isn't the result of loopholes, it has to do with that being the sensible way for countries to fairly tax income (as opposed to sales) without each country stepping all over the others when it comes to who gets to tax which economic activity.
The part which allowed Apple to effectively avoid a lot of taxation was Ireland's atypical tax rules and comparably low tax rate, not the fact that Apple used Ireland to 'sell into' rather than 'sell within' much of Europe. That later part is just trade, as distinguished from domestic economic activity.
Then you had a situation where the U.S. was still (quite inexplicably) extra-territorial when it came to income taxation. By that I mean, the U.S. still thought it was okay to tax economic activity that happened elsewhere if it was a U.S. company doing it. Most advanced economies had already abandoned such extra-territorial taxation policies. But even though the U.S. presumed to tax earnings made elsewhere, that taxation was deferred until those earnings were repatriated. So that allowed Apple to avoid (or defer) U.S. taxation of Irish earnings even though the effective rate those earnings had been taxed at by Ireland was quite low. Apple can't do that any more for a number of reasons.
Apple's only crime was essentially receiving stolen goods -- where Ireland undercut EU taxation rules.
But, if nothing else, this points out the absurdity of international taxation rules -- where a company can fabricate a "headquarters" in some low taxation environment and then operate in other, better established countries and take advantage of the societal advantages there -- societal advantages reaped from infrastructure and stability from a strong central government supported by an adequate revenue stream.
This is not new: companies have been locating fake headquarters in Caribbean tax havens for decades. In fact, that area featured prominently in the causes of the 2008 Great Recession where bad loans were packaged into highly rated CDO's in these Caribbean shelters and sold to unsuspecting buyers. Essentially, it is one country bypassing international rules to benefit itself -- much like any organized crime family does the same.
It is past time that international taxation conventions be modernized to insure that companies (not just Apple) pay for the benefits they receive in the countries they operate in.
I’m confused about what “international taxation rules” you are referring to. I believe each independent nation is entitled to establish their own tax laws and regulations - or did I miss something.
I must point out that Delaware has no corporate taxes and many US companies choose to place their headquarters in that state for that reason. I don’t see anyone screaming about how unfair that is.
Delaware is widely considered to be a tax haven, and there are plenty of people who are opposed to such practises.
OK. So a few are screaming about it. But Delaware violates no federal law and you’d need a constitutional amendment to change that. Similarly, the EU case is really about the limits of EU law over individual nation states within the EU.
I'm not sure what you're asking. But Apple used Ireland as a base of operations in Europe for a number of reasons. One of those was the friendly nature of Irish tax policies. Ireland had, quite intentionally, set up its tax policy to be attractive to foreign businesses. As I indicated previously, the rule whereby non-Irish branches of Irish corporations weren't taxed on their earnings by Ireland was an outlier. It was a way by which Ireland competed with other taxing jurisdictions to attract economic activity. It allowed Apple and others to, quite legally, avoid taxation on meaningful portions of its foreign earnings.
The idea that Apple funneled profits through Ireland is just standard international tax policy stuff - nothing at all unusual or improper about that. That has to do with how governments - for a long time and for good reasons - have taxed income, as distinguishing between economic activity which occurs within their countries or as trade coming into and out of their countries. It isn't the result of loopholes, it has to do with that being the sensible way for countries to fairly tax income (as opposed to sales) without each country stepping all over the others when it comes to who gets to tax which economic activity.
The part which allowed Apple to effectively avoid a lot of taxation was Ireland's atypical tax rules and comparably low tax rate, not the fact that Apple used Ireland to 'sell into' rather than 'sell within' much of Europe. That later part is just trade, as distinguished from domestic economic activity.
Then you had a situation where the U.S. was still (quite inexplicably) extra-territorial when it came to income taxation. By that I mean, the U.S. still thought it was okay to tax economic activity that happened elsewhere if it was a U.S. company doing it. Most advanced economies had already abandoned such extra-territorial taxation policies. But even though the U.S. presumed to tax earnings made elsewhere, that taxation was deferred until those earnings were repatriated. So that allowed Apple to avoid (or defer) U.S. taxation of Irish earnings even though the effective rate those earnings had been taxed at by Ireland was quite low. Apple can't do that any more for a number of reasons.
That article isn't solely about the Irish. Did you read it because if you did not of course you don't know what I'm asking. If you did I've no idea why you're confused.
Two of the three Irish subsidiaries originally involved when the EU made it's initial tax inquiries are no longer based in Ireland, and for reasons explained in the article. They are now resident in Jersey off the coast of France. Why? That's in the article too. Why did one remain in Ireland? That's also explained in the article. What does it have to do with Apple and taxes? Everything as far as I can tell but that's why I was looking for your views on it. In your opinion does it serve to shield money held by them from any tax obligations whatsoever both abroad and in the US? If you're either a tax accountant or lawyer all the better.
I'm not sure what you're asking. But Apple used Ireland as a base of operations in Europe for a number of reasons. One of those was the friendly nature of Irish tax policies. Ireland had, quite intentionally, set up its tax policy to be attractive to foreign businesses. As I indicated previously, the rule whereby non-Irish branches of Irish corporations weren't taxed on their earnings by Ireland was an outlier. It was a way by which Ireland competed with other taxing jurisdictions to attract economic activity. It allowed Apple and others to, quite legally, avoid taxation on meaningful portions of its foreign earnings.
The idea that Apple funneled profits through Ireland is just standard international tax policy stuff - nothing at all unusual or improper about that. That has to do with how governments - for a long time and for good reasons - have taxed income, as distinguishing between economic activity which occurs within their countries or as trade coming into and out of their countries. It isn't the result of loopholes, it has to do with that being the sensible way for countries to fairly tax income (as opposed to sales) without each country stepping all over the others when it comes to who gets to tax which economic activity.
The part which allowed Apple to effectively avoid a lot of taxation was Ireland's atypical tax rules and comparably low tax rate, not the fact that Apple used Ireland to 'sell into' rather than 'sell within' much of Europe. That later part is just trade, as distinguished from domestic economic activity.
Then you had a situation where the U.S. was still (quite inexplicably) extra-territorial when it came to income taxation. By that I mean, the U.S. still thought it was okay to tax economic activity that happened elsewhere if it was a U.S. company doing it. Most advanced economies had already abandoned such extra-territorial taxation policies. But even though the U.S. presumed to tax earnings made elsewhere, that taxation was deferred until those earnings were repatriated. So that allowed Apple to avoid (or defer) U.S. taxation of Irish earnings even though the effective rate those earnings had been taxed at by Ireland was quite low. Apple can't do that any more for a number of reasons.
That article isn't solely about the Irish. Did you read it?
Not yet. Are you asking me to comment on its accuracy or the fairness of its characterizations?
I will if you want me to. But that doesn't seem all that important to me. What's important to me is the reality of the situation, e.g. how various aspects of tax policy work.
I say make Apple Pay. They want heavy government spending, they should pay for it; their effective tax rate is too low for the biggest public company in the world.
It was Ireland who broke the law, not Apple. Apple reaped the benefits of the scheme (as did Ireland). But it was Ireland who committed the crime -- Apple basically simply received the stolen goods.
Funny how the article is about a court deciding that no crime was committed. Perhaps you didn't read it.
That decided that there wasn't sufficient evidence that rules were broken. And that decision is appealable, where more evidence can be provided. Not quite the same.
After 4+ years if they haven’t compiled enough evidence I doubt they will find more at this point. Lame and desperate hopefulness after years of being wrong on this issue with wishful and capri-cious thinking
I'm not sure what you're asking. But Apple used Ireland as a base of operations in Europe for a number of reasons. One of those was the friendly nature of Irish tax policies. Ireland had, quite intentionally, set up its tax policy to be attractive to foreign businesses. As I indicated previously, the rule whereby non-Irish branches of Irish corporations weren't taxed on their earnings by Ireland was an outlier. It was a way by which Ireland competed with other taxing jurisdictions to attract economic activity. It allowed Apple and others to, quite legally, avoid taxation on meaningful portions of its foreign earnings.
The idea that Apple funneled profits through Ireland is just standard international tax policy stuff - nothing at all unusual or improper about that. That has to do with how governments - for a long time and for good reasons - have taxed income, as distinguishing between economic activity which occurs within their countries or as trade coming into and out of their countries. It isn't the result of loopholes, it has to do with that being the sensible way for countries to fairly tax income (as opposed to sales) without each country stepping all over the others when it comes to who gets to tax which economic activity.
The part which allowed Apple to effectively avoid a lot of taxation was Ireland's atypical tax rules and comparably low tax rate, not the fact that Apple used Ireland to 'sell into' rather than 'sell within' much of Europe. That later part is just trade, as distinguished from domestic economic activity.
Then you had a situation where the U.S. was still (quite inexplicably) extra-territorial when it came to income taxation. By that I mean, the U.S. still thought it was okay to tax economic activity that happened elsewhere if it was a U.S. company doing it. Most advanced economies had already abandoned such extra-territorial taxation policies. But even though the U.S. presumed to tax earnings made elsewhere, that taxation was deferred until those earnings were repatriated. So that allowed Apple to avoid (or defer) U.S. taxation of Irish earnings even though the effective rate those earnings had been taxed at by Ireland was quite low. Apple can't do that any more for a number of reasons.
That article isn't solely about the Irish. Did you read it?
Not yet. Are you asking me to comment on its accuracy or the fairness of its characterizations?
I will if you want me to. But that doesn't seem all that important to me. What's important to me is the reality of the situation, e.g. how various aspects of tax policy work.
That article has everything to do with Apple's tax policy and the reality of the situation regarding the repatriation of funds and the US taxes due on those profits. Why would you think it unimportant?
I'm not sure what you're asking. But Apple used Ireland as a base of operations in Europe for a number of reasons. One of those was the friendly nature of Irish tax policies. Ireland had, quite intentionally, set up its tax policy to be attractive to foreign businesses. As I indicated previously, the rule whereby non-Irish branches of Irish corporations weren't taxed on their earnings by Ireland was an outlier. It was a way by which Ireland competed with other taxing jurisdictions to attract economic activity. It allowed Apple and others to, quite legally, avoid taxation on meaningful portions of its foreign earnings.
The idea that Apple funneled profits through Ireland is just standard international tax policy stuff - nothing at all unusual or improper about that. That has to do with how governments - for a long time and for good reasons - have taxed income, as distinguishing between economic activity which occurs within their countries or as trade coming into and out of their countries. It isn't the result of loopholes, it has to do with that being the sensible way for countries to fairly tax income (as opposed to sales) without each country stepping all over the others when it comes to who gets to tax which economic activity.
The part which allowed Apple to effectively avoid a lot of taxation was Ireland's atypical tax rules and comparably low tax rate, not the fact that Apple used Ireland to 'sell into' rather than 'sell within' much of Europe. That later part is just trade, as distinguished from domestic economic activity.
Then you had a situation where the U.S. was still (quite inexplicably) extra-territorial when it came to income taxation. By that I mean, the U.S. still thought it was okay to tax economic activity that happened elsewhere if it was a U.S. company doing it. Most advanced economies had already abandoned such extra-territorial taxation policies. But even though the U.S. presumed to tax earnings made elsewhere, that taxation was deferred until those earnings were repatriated. So that allowed Apple to avoid (or defer) U.S. taxation of Irish earnings even though the effective rate those earnings had been taxed at by Ireland was quite low. Apple can't do that any more for a number of reasons.
That article isn't solely about the Irish. Did you read it?
Not yet. Are you asking me to comment on its accuracy or the fairness of its characterizations?
I will if you want me to. But that doesn't seem all that important to me. What's important to me is the reality of the situation, e.g. how various aspects of tax policy work.
That article has everything to do with Apple's tax policy and the reality of the situation regarding the repatriation of funds and the US taxes due on those profits. Why would you think it unimportant?
It's not important to me - it may well be important to others - because I already understand the issues we're talking about. I don't need to go to an article by someone I know nothing about to find an explanation of the situation. For one, I wouldn't know whether I could trust their characterizations - so often what people write is nonsense.
If it was an issue I needed to figure out, I might take the time to read what others have written and then have to judge its accuracy and fairness. More likely I'd look for hard sources to figure out how things work, rather than having to rely on the opinions or explanations of others - people whom I don't know whether I should trust or not. If I really want to understand something, I'll do the work to sort it out for myself. Otherwise I can't be sure my understanding is fair and accurate. There are plenty of things I don't understand because I haven't done the work to sort them out.
EDIT: I should probably be clear here on what I'm saying and not saying. An article like that is of little use to me, because I have no way of knowing whether something they say is accurate. It doesn't include any links to source materials, so I can't judge the fairness of anything they say - and I don't know the author from Adam. It either says something I already know or it says something I don't know but which I can't rely on. If they're going to defer to what others have said or what certain documents show, then what they say only has real value to me if they link to such things. To the extent it's just an overview of the situation, I don't really need that. I need specific information that might add to my understanding. To the extent it's a piece trying to push a narrative, I also don't have much use for that.
I think this was a no-brainer, Apple and Ireland should have won this appeal. The European Commission's decision never demonstrated what it claimed it did and what it needed to in order to justify the action it took.
That said, I'm quite surprised that Ireland and Apple did win.
Let’s wait to see if the EC goes to the Court of Justice for a final verdict.
I suspect the EU will ultimately win. I'm surprised Apple and Ireland even won at this stage though.
The EU's case presentation was apparently less than stellar, losing on the preparation but not yet on the facts. I tend to agree with you that in the end Ireland (and by extension Apple) won't win this one.
On what basis except perhaps this is what you have always believed.
I'm not sure what you're asking. But Apple used Ireland as a base of operations in Europe for a number of reasons. One of those was the friendly nature of Irish tax policies. Ireland had, quite intentionally, set up its tax policy to be attractive to foreign businesses. As I indicated previously, the rule whereby non-Irish branches of Irish corporations weren't taxed on their earnings by Ireland was an outlier. It was a way by which Ireland competed with other taxing jurisdictions to attract economic activity. It allowed Apple and others to, quite legally, avoid taxation on meaningful portions of its foreign earnings.
The idea that Apple funneled profits through Ireland is just standard international tax policy stuff - nothing at all unusual or improper about that. That has to do with how governments - for a long time and for good reasons - have taxed income, as distinguishing between economic activity which occurs within their countries or as trade coming into and out of their countries. It isn't the result of loopholes, it has to do with that being the sensible way for countries to fairly tax income (as opposed to sales) without each country stepping all over the others when it comes to who gets to tax which economic activity.
The part which allowed Apple to effectively avoid a lot of taxation was Ireland's atypical tax rules and comparably low tax rate, not the fact that Apple used Ireland to 'sell into' rather than 'sell within' much of Europe. That later part is just trade, as distinguished from domestic economic activity.
Then you had a situation where the U.S. was still (quite inexplicably) extra-territorial when it came to income taxation. By that I mean, the U.S. still thought it was okay to tax economic activity that happened elsewhere if it was a U.S. company doing it. Most advanced economies had already abandoned such extra-territorial taxation policies. But even though the U.S. presumed to tax earnings made elsewhere, that taxation was deferred until those earnings were repatriated. So that allowed Apple to avoid (or defer) U.S. taxation of Irish earnings even though the effective rate those earnings had been taxed at by Ireland was quite low. Apple can't do that any more for a number of reasons.
That article isn't solely about the Irish. Did you read it?
Not yet. Are you asking me to comment on its accuracy or the fairness of its characterizations?
I will if you want me to. But that doesn't seem all that important to me. What's important to me is the reality of the situation, e.g. how various aspects of tax policy work.
That article has everything to do with Apple's tax policy and the reality of the situation regarding the repatriation of funds and the US taxes due on those profits. Why would you think it unimportant?
I should probably be clear here on what I'm saying and not saying. An article like that is of little use to me, because I have no way of knowing whether something they say is accurate.
It doesn't include any links to source materials I don't know the author from Adam. If they're going to defer to what others have said or what certain documents show, then what they say only has real value to me if they link to such things. I need specific information that might add to my understanding.
Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho. I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law. I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
This has been gone over many times, there is no retroactive changing of the law, the law came into force in 1992 (I believe it was Maastricht) and Ireland should have adjusted its tax relationship with Apple at the time. Just because it has taken a number of years for the case to be brought doesn't mean the law has been changed in any way. It is Ireland that is accused of breaking EU law, not Apple; Apple was merely the beneficiary. Also, the EU will not "get" anything much from this - if Apple and Ireland loses the case then the money held in escrow is payable to the tax authorities in Ireland, not the EU.
Again, this has been covered many times. Please stop spreading misinformation.
You're the one spreading misinformation, I am afraid. If the money gets credited to Ireland, that is money in the bank for the EU since they will have to send a smaller annual check to the country (Ireland is a net recipient of EU largesse).
The irony that you are accusing someone of spreading misinformation. Ireland has been a net CONTRIBUTOR to the EU for the past few years.
Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho. I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law. I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
This has been gone over many times, there is no retroactive changing of the law, the law came into force in 1992 (I believe it was Maastricht) and Ireland should have adjusted its tax relationship with Apple at the time. Just because it has taken a number of years for the case to be brought doesn't mean the law has been changed in any way. It is Ireland that is accused of breaking EU law, not Apple; Apple was merely the beneficiary. Also, the EU will not "get" anything much from this - if Apple and Ireland loses the case then the money held in escrow is payable to the tax authorities in Ireland, not the EU.
Again, this has been covered many times. Please stop spreading misinformation.
You're the one spreading misinformation, I am afraid. If the money gets credited to Ireland, that is money in the bank for the EU since they will have to send a smaller annual check to the country (Ireland is a net recipient of EU largesse).
Moreover, if Apple had lost, the long run consequences for Ireland, by making is less competitive as a destination for US tech investment, might have been for more onerous. You're ignoring some basic facts here.
Ireland is a net contributor to the EU, and has been for a while.
As for the comment you were replying to, the law used against Ireland was state aid, not that they had too low a taxation level. Which isn't something that is a competency of the EU.
Ireland didn't turn positive in its net contributions to the EU until recently (2018, I think). During the period 2014-2016 (when the case was being brought), Ireland was a net recipient (see below for actual EU -- not Irish Times -- data). Ireland was even more of a net recipient during the period of the supposed "preferential tax treatment", i.e., the period that is actually being litigated (which I believe was the 2000s through the early 2010s).
I recall discussion in the media then about how, if the EU won the case, Ireland might have had to fork over the money to the EU because of its cumulative net recipient status.
+
Dont know where that map came from, do you have a source? In any case its from 2014-2016.
This has nothing to do with Ireland’s general tax rate, it has to do with special arrangements, where the accusation is that Apple were afforded circumstances that weren’t available to other companies.
Apple's only crime was essentially receiving stolen goods -- where Ireland undercut EU taxation rules.
But, if nothing else, this points out the absurdity of international taxation rules -- where a company can fabricate a "headquarters" in some low taxation environment and then operate in other, better established countries and take advantage of the societal advantages there -- societal advantages reaped from infrastructure and stability from a strong central government supported by an adequate revenue stream.
This is not new: companies have been locating fake headquarters in Caribbean tax havens for decades. In fact, that area featured prominently in the causes of the 2008 Great Recession where bad loans were packaged into highly rated CDO's in these Caribbean shelters and sold to unsuspecting buyers. Essentially, it is one country bypassing international rules to benefit itself -- much like any organized crime family does the same.
It is past time that international taxation conventions be modernized to insure that companies (not just Apple) pay for the benefits they receive in the countries they operate in.
I’m confused about what “international taxation rules” you are referring to. I believe each independent nation is entitled to establish their own tax laws and regulations - or did I miss something.
I must point out that Delaware has no corporate taxes and many US companies choose to place their headquarters in that state for that reason. I don’t see anyone screaming about how unfair that is.
Delaware is widely considered to be a tax haven, and there are plenty of people who are opposed to such practises.
OK. So a few are screaming about it. But Delaware violates no federal law and you’d need a constitutional amendment to change that. Similarly, the EU case is really about the limits of EU law over individual nation states within the EU.
That's correct. Different states tax different things, e.g., sales, property, incomes, corporate profits and in different combinations, in order to manage their budgets. Delaware is is the corporate favorite for incorporation (70% of Fortune 500 companies are incorporated there) primarily because: (i) all corporate law in the US is at the state level (i.e., not federal); (ii) rulings on corporate law by the widely-respected Delaware Chancery has become the de facto US corporate law; (iii) the state of Delaware gets a fair amount of annual revenue from incorporation fees.
Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho. I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law. I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
This has been gone over many times, there is no retroactive changing of the law, the law came into force in 1992 (I believe it was Maastricht) and Ireland should have adjusted its tax relationship with Apple at the time. Just because it has taken a number of years for the case to be brought doesn't mean the law has been changed in any way. It is Ireland that is accused of breaking EU law, not Apple; Apple was merely the beneficiary. Also, the EU will not "get" anything much from this - if Apple and Ireland loses the case then the money held in escrow is payable to the tax authorities in Ireland, not the EU.
Again, this has been covered many times. Please stop spreading misinformation.
You're the one spreading misinformation, I am afraid. If the money gets credited to Ireland, that is money in the bank for the EU since they will have to send a smaller annual check to the country (Ireland is a net recipient of EU largesse).
The irony that you are accusing someone of spreading misinformation. Ireland has been a net CONTRIBUTOR to the EU for the past few years.
I'll say it one more time: NOT DURING THE TIME OF THE DEVELOPMENT AND FILING OF THE CASE (2014-16) NOR DURING THE TIME PERIOD OF THE TAXES IN DISPUTE (I.E., 2000s and the 2010s).
Also, I provided the data to back up my assertion, sourced directly from the EU. Either read the thread, or look it up.
I've always wondered why Apple was singled out for prosecution, since I've seen no evidence (I have not reviewed every scrap of presented evidence but have reviewed the reports on the case over the years) that Ireland conspired to cut a special and exclusive deal just for Apple. The "double Irish" is a tax loophole that a number of tech and non-tech companies took advantage of. To me, this puts any guilt clearly in one lap: Ireland's. So why wasn't (for example) Starbucks also prosecuted?
Publicly traded companies have a fiducisary responsibility to pay only the minimum legal tax they owe. The flaws here are in either Ireland's or the EU's own tax laws. There has never been a charge related to this case that Apple didn't pay what the law required, and so what I would hope would happen for the final appeal is the the court orders Ireland to close its loopholes and be in compliance with standard EU tax rates, but takes Apple off the table since there was no law actually broken at any point here by the company.
Cook has said repeatedly that he's fine with a uniform tax code that might result in higher taxes for Apple to pay, but in order for that to be effective it needs to be uniform throughout the EU so there aren't any "havens." If there are legal tax havens, companies are essentially required by their stockholders to use them. Customers already pay a rather high VAT (not to mention an unfavourable price due to exchange rates) on goods made outside the EU and UK; a uniform EU corporate tax would be welcome but would still need to be fairly low in order to make foreign sales tenable.
Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho. I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law. I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
This has been gone over many times, there is no retroactive changing of the law, the law came into force in 1992 (I believe it was Maastricht) and Ireland should have adjusted its tax relationship with Apple at the time. Just because it has taken a number of years for the case to be brought doesn't mean the law has been changed in any way. It is Ireland that is accused of breaking EU law, not Apple; Apple was merely the beneficiary. Also, the EU will not "get" anything much from this - if Apple and Ireland loses the case then the money held in escrow is payable to the tax authorities in Ireland, not the EU.
Again, this has been covered many times. Please stop spreading misinformation.
You're the one spreading misinformation, I am afraid. If the money gets credited to Ireland, that is money in the bank for the EU since they will have to send a smaller annual check to the country (Ireland is a net recipient of EU largesse).
The irony that you are accusing someone of spreading misinformation. Ireland has been a net CONTRIBUTOR to the EU for the past few years.
I'll say it one more time: NOT DURING THE TIME OF THE DEVELOPMENT AND FILING OF THE CASE (2014-16) NOR DURING THE TIME PERIOD OF THE TAXES IN DISPUTE (I.E., 2000s and the 2010s).
Also, I provided the data to back up my assertion, sourced directly from the EU. Either read the thread, or look it up.
That’s nice, but your claim is that the EU would just „cut a smaller check to Ireland“, because they are a net recipient.
a) that’s not how the EU works, as the money coming from EU funds is a bunch of little parcels tied to specific projects, regions, or purposes, so withholding those from a certain country isn’t easily possible, since they aren’t necessarily granted to a „country“, per se, as I understand it.
b) Ireland is not a net recipient of EU funds; it is a net contributor. It has been a net recipient in the past, but why that should affect a statement about today and future payments is not apparent to me.
It is possible that Ireland may be required to contribute more to the EU budget, since gross national income is part of how that contribution is calculated. But who knows how the different regional economies will have fared in a Covid world? We’re all tumbling right now.
I wonder if the EU's halfhearted effort to prosecute this has to do with the fact that Ireland is at the front line of Brexit. No need to pile on the small loyal state that will need all the help it can past December 31st. At this time there is a high chance of a closed border between NI and Ireland once the looming hard Brexit comes true. With that would come societal pain, economic pain, geographic isolation, and need for assistance. And hopefully no violence added to the mix. Instead the EU is probably more focused on being more vigilant in preventing such deals in the future. The investigation into this matter started before the Brexit vote, it is a different set of circumstances for Ireland now. Let's see if there is any Brexit deal at all and then how hard the EU appeals this.
Thankfully this isn’t a final decision and the EU will appeal, and it’s widely expected for the top EU court to rule against Apple, you cannot lay 0.005% corporate tax when the standard is 12% the country and claim you thought it was normal. That’s a clear abuse of state aide rules and also so is having an office that exists in paper only. They also have a PO Box in the Netherlands for all iTunes sales.. If Apple doesn’t want to pay its taxes then it can’t use roads, emergency services, bin collection, all other services provided by the local councils etc etc and the people of Ireland shouldn’t be made to pay for Apples shortfall either. The only money the government has it was it gets in taxes, and 12 billion is a noticeable dent in that.
Comments
The idea that Apple funneled profits through Ireland is just standard international tax policy stuff - nothing at all unusual or improper about that. That has to do with how governments - for a long time and for good reasons - have taxed income, as distinguishing between economic activity which occurs within their countries or as trade coming into and out of their countries. It isn't the result of loopholes, it has to do with that being the sensible way for countries to fairly tax income (as opposed to sales) without each country stepping all over the others when it comes to who gets to tax which economic activity.
The part which allowed Apple to effectively avoid a lot of taxation was Ireland's atypical tax rules and comparably low tax rate, not the fact that Apple used Ireland to 'sell into' rather than 'sell within' much of Europe. That later part is just trade, as distinguished from domestic economic activity.
Then you had a situation where the U.S. was still (quite inexplicably) extra-territorial when it came to income taxation. By that I mean, the U.S. still thought it was okay to tax economic activity that happened elsewhere if it was a U.S. company doing it. Most advanced economies had already abandoned such extra-territorial taxation policies. But even though the U.S. presumed to tax earnings made elsewhere, that taxation was deferred until those earnings were repatriated. So that allowed Apple to avoid (or defer) U.S. taxation of Irish earnings even though the effective rate those earnings had been taxed at by Ireland was quite low. Apple can't do that any more for a number of reasons.
Two of the three Irish subsidiaries originally involved when the EU made it's initial tax inquiries are no longer based in Ireland, and for reasons explained in the article. They are now resident in Jersey off the coast of France. Why? That's in the article too. Why did one remain in Ireland? That's also explained in the article. What does it have to do with Apple and taxes? Everything as far as I can tell but that's why I was looking for your views on it. In your opinion does it serve to shield money held by them from any tax obligations whatsoever both abroad and in the US? If you're either a tax accountant or lawyer all the better.
I will if you want me to. But that doesn't seem all that important to me. What's important to me is the reality of the situation, e.g. how various aspects of tax policy work.
If it was an issue I needed to figure out, I might take the time to read what others have written and then have to judge its accuracy and fairness. More likely I'd look for hard sources to figure out how things work, rather than having to rely on the opinions or explanations of others - people whom I don't know whether I should trust or not. If I really want to understand something, I'll do the work to sort it out for myself. Otherwise I can't be sure my understanding is fair and accurate. There are plenty of things I don't understand because I haven't done the work to sort them out.
EDIT: I should probably be clear here on what I'm saying and not saying. An article like that is of little use to me, because I have no way of knowing whether something they say is accurate. It doesn't include any links to source materials, so I can't judge the fairness of anything they say - and I don't know the author from Adam. It either says something I already know or it says something I don't know but which I can't rely on. If they're going to defer to what others have said or what certain documents show, then what they say only has real value to me if they link to such things. To the extent it's just an overview of the situation, I don't really need that. I need specific information that might add to my understanding. To the extent it's a piece trying to push a narrative, I also don't have much use for that.
Got your drift.
How about this one that includes lots of links and sources and specific information? It should cover all your stated objections to reading the other one.
https://www.nytimes.com/2017/11/06/world/apple-taxes-jersey.html
And if you doubt the professionalism of the writer:
https://www.nytimes.com/by/jesse-drucker
Still not interested? Then you only think you already know it all if you're being genuine in your comments.
Why bother with arcane nonsense like facts...
I just give up.
Also, I provided the data to back up my assertion, sourced directly from the EU. Either read the thread, or look it up.
Cook has said repeatedly that he's fine with a uniform tax code that might result in higher taxes for Apple to pay, but in order for that to be effective it needs to be uniform throughout the EU so there aren't any "havens." If there are legal tax havens, companies are essentially required by their stockholders to use them. Customers already pay a rather high VAT (not to mention an unfavourable price due to exchange rates) on goods made outside the EU and UK; a uniform EU corporate tax would be welcome but would still need to be fairly low in order to make foreign sales tenable.
I wonder if the EU's halfhearted effort to prosecute this has to do with the fact that Ireland is at the front line of Brexit. No need to pile on the small loyal state that will need all the help it can past December 31st. At this time there is a high chance of a closed border between NI and Ireland once the looming hard Brexit comes true. With that would come societal pain, economic pain, geographic isolation, and need for assistance. And hopefully no violence added to the mix. Instead the EU is probably more focused on being more vigilant in preventing such deals in the future. The investigation into this matter started before the Brexit vote, it is a different set of circumstances for Ireland now. Let's see if there is any Brexit deal at all and then how hard the EU appeals this.
If Apple doesn’t want to pay its taxes then it can’t use roads, emergency services, bin collection, all other services provided by the local councils etc etc and the people of Ireland shouldn’t be made to pay for Apples shortfall either. The only money the government has it was it gets in taxes, and 12 billion is a noticeable dent in that.