Apple could owe over $8 billion in European taxes, new estimate indicates

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Comments

  • Reply 61 of 114
    I'm glad the Europeans have the guts to stand up to these corporations. It seems the US lawmakers and regulators are owned by them. 
  • Reply 62 of 114
    Oh government, they can't produce anything of their own so they use threat of force to steal money from people and corporations. 
    You mean, like build roads and bridges? Educate our children? Take care of us when we get old? No, government does a lot of good, a lot of good. 
    cnocbuidasanman69
  • Reply 63 of 114
    gwydiongwydion Posts: 1,083member
    tenly said:
    The EU is forcing Ireland to comply.
    So, hang on a sec...there are so many contradictions in this thread that I'm having trouble understanding what actually happened....

    It is my understanding that there were no closed door negotiations between Apple and the Irish government and that Apple designed and complied with the existing, published, Irish Tax rules, rates and procedures....  Is that not true?
    The tax breaks were offered to only some companies and in a secret way
    singularitycnocbuiasdasd
  • Reply 64 of 114
    tenlytenly Posts: 709member
    gwydion said:
    tenly said:
    So, hang on a sec...there are so many contradictions in this thread that I'm having trouble understanding what actually happened....

    It is my understanding that there were no closed door negotiations between Apple and the Irish government and that Apple designed and complied with the existing, published, Irish Tax rules, rates and procedures....  Is that not true?
    The tax breaks were offered to only some companies and in a secret way
    That definitely wasn't my understanding - and it does change things a little - but only a little.  Ireland is essentially an "authorized representative" of the EU and as such, any agreements they enter into - should be binding.  Consider this analogy we can all understand and tell me how you would react - let's say we are planning a wedding and we select a JW Marrriott hotel for the reception.  We strike up a conversation with the hotel manager and we negotiate a $1500 discount on the price of the ballroom/catering package because we promise to buy 100+ rooms for the night of the wedding to put up our out of town guests.  We follow through with the wedding - we honor our commitment to purchase 105 rooms.  We encourage our guests to book their rooms with the JW even though there is a Hilton directly next door that is half the cost!  But we keep our promise and that hotel does too.  We pay the discounted price for the ballroom and all is well.  Everybody is happy. So happy in fact that you book annual events at the same property and each year you encourage your guests to purchase their rooms from the more expensive Marriott because the hotel manager gives you a discount on the meeting rooms/catering.  BUT THEN --- out of the blue - 5 years after the initial wedding - you get a phone call from Marriott International explaining to you that their hotel manager actually did not have the authority to discounts the conference rooms you had rented and that you would now be required to retroactively pay the full price (plus interest) on all of your events over the past 5 years!

    I don't think that a single one of you would understand Marriott Internationals position and be willing to pay the retroactive charges.  Especially since the hotel enjoyed the benefit in revenue that they received when you fulfilled your side of the agreement and purchased large blocks of rooms for each event!  And I also don't think you would change your mind if they explained that other people whom had their weddings and events at the same venue did not receive any discount - so really you're just paying your fair share anyhow.

    This is exactly what is being demanded of Apple.  Internally within the EU - there should be an approval process in place to ratify/approve any "special" agreements - and if Ireland chooses to bypass that process - they should be held liable.  At the very, very least - the EU should not be allowed to go retroactive for more than a year.  If they can't be bothered to review the special arrangements being offered to certain large corporations within a year of the payment being charged/collected - it's pure and simple negligence on their part - or more than that collusion and deceit.  If the government knows that they can retroactively change the agreement going back 7 or more years - it's in their best financial interest to "let it slide" that long lest the companies move their operations to another jurisdiction!  It's slimey, it's corrupt, it's unethical and it's fraudulent.  Its criminal.

    SpamSandwich
  • Reply 65 of 114
    tenly said:
    cnocbui said:
    It wouldn't be legal to set up a 'sovereign' country.  It wouldn't be recognised  by legitimate countries.  Who would live in this country?  Companies can't exist without people.  Who in their right mind would want to live in this corporate hell?  Do you honestly think Apple could persuade it's employees to move there with their families?
    'Honey, great news, were not moving to Sydney after all, we're going to Corparia!'
    'No, YOU are moving to Corparia.  You can make yourself dinner, I need to talk to my lawyer.'

    People have families, they have children who need schooling, they have friends, their children have friends, they want nice places to live, amenities, culture, recreation, schools, medical care - by the time these insane corporations of yours have gotten around to trying to duplicate all a modern society has to offer and people expect, they will have had to spend every last penny they make, and still wont get anywhere close.

    What a completely daft idea.


    I disagree.  Especially if they start by purchasing a small country, province, state or area that already has a reasonable infrastructure in place.

    i also think it would be VERY easy to attract citizens.  Can you think of any people that live in a country in which they are not happy with their existing living conditions and/or government?

    The only obstacle is as you stated - other existing countries would refuse to recognize them.

    But I would go in a heartbeat - even if it were just for the self-driving cars!!!  /s
    How do you think this corporate country can offer infrastructure, schools, hospitals, security ... without taking any taxes. Who is going to pay for this. If every citizen can cherry pick for which service he wants to pay there will be no services available.
  • Reply 66 of 114
    tenly said:
    gwydion said:
    The tax breaks were offered to only some companies and in a secret way
    That definitely wasn't my understanding - and it does change things a little - but only a little.  Ireland is essentially an "authorized representative" of the EU and as such, any agreements they enter into - should be binding.  Consider this analogy we can all understand and tell me how you would react - let's say we are planning a wedding and we select a JW Marrriott hotel for the reception.  We strike up a conversation with the hotel manager and we negotiate a $1500 discount on the price of the ballroom/catering package because we promise to buy 100+ rooms for the night of the wedding to put up our out of town guests.  We follow through with the wedding - we honor our commitment to purchase 105 rooms.  We encourage our guests to book their rooms with the JW even though there is a Hilton directly next door that is half the cost!  But we keep our promise and that hotel does too.  We pay the discounted price for the ballroom and all is well.  Everybody is happy. So happy in fact that you book annual events at the same property and each year you encourage your guests to purchase their rooms from the more expensive Marriott because the hotel manager gives you a discount on the meeting rooms/catering.  BUT THEN --- out of the blue - 5 years after the initial wedding - you get a phone call from Marriott International explaining to you that their hotel manager actually did not have the authority to discounts the conference rooms you had rented and that you would now be required to retroactively pay the full price (plus interest) on all of your events over the past 5 years!

    I don't think that a single one of you would understand Marriott Internationals position and be willing to pay the retroactive charges.  Especially since the hotel enjoyed the benefit in revenue that they received when you fulfilled your side of the agreement and purchased large blocks of rooms for each event!  And I also don't think you would change your mind if they explained that other people whom had their weddings and events at the same venue did not receive any discount - so really you're just paying your fair share anyhow.

    This is exactly what is being demanded of Apple.  Internally within the EU - there should be an approval process in place to ratify/approve any "special" agreements - and if Ireland chooses to bypass that process - they should be held liable.  At the very, very least - the EU should not be allowed to go retroactive for more than a year.  If they can't be bothered to review the special arrangements being offered to certain large corporations within a year of the payment being charged/collected - it's pure and simple negligence on their part - or more than that collusion and deceit.  If the government knows that they can retroactively change the agreement going back 7 or more years - it's in their best financial interest to "let it slide" that long lest the companies move their operations to another jurisdiction!  It's slimey, it's corrupt, it's unethical and it's fraudulent.  Its criminal.

    Ireland are accused of offering a deal to Apple that is against EU law. 
    Ireland is not an "authorised representative" of the EU
    Thus any agreement IF found to be against EU laws will be null.
    IF found to be null Apple will be forced to pay back any tax that was unpaid.
    Currently the time period covered by the potential pay back period is the maximum period covered by EU law, there's no retroactive part. If there was then they could go back even further.
     


  • Reply 67 of 114
    cnocbuicnocbui Posts: 3,613member
    tenly said:
    cnocbui said:
    It wouldn't be legal to set up a 'sovereign' country.  It wouldn't be recognised  by legitimate countries.  Who would live in this country?  Companies can't exist without people.  Who in their right mind would want to live in this corporate hell?  Do you honestly think Apple could persuade it's employees to move there with their families?
    'Honey, great news, were not moving to Sydney after all, we're going to Corparia!'
    'No, YOU are moving to Corparia.  You can make yourself dinner, I need to talk to my lawyer.'

    People have families, they have children who need schooling, they have friends, their children have friends, they want nice places to live, amenities, culture, recreation, schools, medical care - by the time these insane corporations of yours have gotten around to trying to duplicate all a modern society has to offer and people expect, they will have had to spend every last penny they make, and still wont get anywhere close.

    What a completely daft idea.


    I disagree.  Especially if they start by purchasing a small country, province, state or area that already has a reasonable infrastructure in place.

    i also think it would be VERY easy to attract citizens.  Can you think of any people that live in a country in which they are not happy with their existing living conditions and/or government?

    The only obstacle is as you stated - other existing countries would refuse to recognize them.

    But I would go in a heartbeat - even if it were just for the self-driving cars!!!  /s
    How about Ireland, Switzerland, Australia, France New Zealand, Israel, Italy, Norway, Sweden, Monaco, Spain, Germany, Canada, etc.  Citizens in the EU have the right to go and live in any other EU country.  Guess what? the vast majority seem to like where they live and stay there.  Just because people in the US aren't happy living where they do, doesn't mean other people in other countries feel the same way.  Ironically, people in the US seem to be perpetually bitching about how much tax they pay while actually having one of  he lowest personal tax burdens, as a percentage of GDP, of any OECD countriy.  That is probably why the US has such a high corporate rate - to make up for the low personal rate. 



    As for buying somewhere that already has infrastructure of a high standard - that isn't going to happen.  No country would sel iteslef or a part theirof and there would be people already living there who wouldn't be too keen on the idea.

    The whole idea is up there with wanting to patent DNA.   It's basically a desire for the biggest tax doge ever.  The mindset behind it is exactly why almost every developed country has a problem with insufficient tax revenues.  Those who should be paying the most - because they earn the most - large multi-nationals - are paying amongst the least as a proportion of their income.  They are the only ones with the resources to construct and run these complicated tax avoidance schemes.
    edited January 2016 singularity
  • Reply 68 of 114
    tenlytenly Posts: 709member
    cnocbui said:
    tenly said:
    I disagree.  Especially if they start by purchasing a small country, province, state or area that already has a reasonable infrastructure in place.

    i also think it would be VERY easy to attract citizens.  Can you think of any people that live in a country in which they are not happy with their existing living conditions and/or government?

    The only obstacle is as you stated - other existing countries would refuse to recognize them.

    But I would go in a heartbeat - even if it were just for the self-driving cars!!!  /s
    How about Ireland, Switzerland, Australia, France New Zealand, Israel, Italy, Norway, Sweden, Monaco, Spain, Germany, Canada, etc.  Citizens in the EU have the right to go and live in any other EU country.  Guess what? the vast majority seem to like where they live and stay there.  Just because people in the US aren't happy living where they do, doesn't mean other people in other countries feel the same way.  Ironically, people in the US seem to be perpetually bitching about how much tax they pay while actually having amongst the lowest tax burden, as a percentage of GDP, of any OECD countriy.  That is probably why the US has such a high corporate rate - to make up for the low personal rate. 


    Your point?  I didn't suggest that an entire countries population is unhappy or would move.  But there are people in every company who are unhappy.  And I suggested that there would be enough worldwide to populate whatever hypothetical new country the corporations hypothetical create/found.

    The whole conversation is hypothetical and for me at least - tongue in cheek.  It will never happen.  It's just a silly tangent to the main issues in this thread.  If it were to happen - it would probably be a very small island or piece of land the size of Singapore or maybe even the Vatican - so it wouldn't take very many people to populate it!

    Also, you seem to think I'm a citizen or resident of the US.  I'm not.
  • Reply 69 of 114
    Its about time. I hope every US company using this elaborate tax dodge is fined to the hilt. Makes a change when a US firm is hit. Interesting the billions the US has made fining UK banks compared to US banks and when BP had to pay $30 billion when Halliburton f* up.  
    singularitycnocbui
  • Reply 70 of 114
    US Tax Laws allow foreign Companies who earn monies outside the US and being those earnings into US to not pay any taxes on said earnings, hence the reason Pfizer bought Allergen PLC (Domiciled in Ireland) where Allergen can bring all earned income they make in Ireland and elsewhere into US and out spend companies like Pfizer on R&D, where Pfizer who currently is Domiciled in US and if a Global Company (Ireland) pays Taxes in Ireland and also is forced to pay earned income taxes on same money here in US allowing Companies like Allergen to have nearly a 20% earnings Tax advantage over all US Domiciled Companies hence reason Pfizer is buying Allergen to move their Domicile to Ireland. Perhaps Apple should follow suit if our Dearly elected decides to not restructure our Tax laws in line with Countries like say Ireland for instance... Secondly that's the reason companies like Apple who are Cash Rich will not bring their earned income back to US where they'd have to pay upwards of 40% more in Taxes on same earned income they've already been Taxed, as Tim Cook noted during his interview on 60 Minutes "That would be crazy for us to pay 40% taxes for Share holds..." (Disclaimer I own Apple) and Tim Cook is right. The better idea right now is to simply borrow against all that Cash Apple has overseas to use back home in States when interest rates are so cheap (0%) for all intense and purposes why the hell wouldn't Apple/Others borrow against they're oversea's Cash piles ??? Makes sense to me, and makes sense to move your Domicile overseas via M&A Buying up some some small Companies Address in countries like Ireland, Brilliant !!!!
    tenly
  • Reply 71 of 114
    gwydiongwydion Posts: 1,083member
    tenly said:
    This is exactly what is being demanded of Apple.  

      It's slimey, it's corrupt, it's unethical and it's fraudulent.  Its criminal.

    No, it is no what is demanded of Apple (and other companies) and no, it is not corrupr, unethical or fraudulent, it is how law is applied and it is ethical and lawful
    singularity
  • Reply 72 of 114
    cnocbuicnocbui Posts: 3,613member
    gwydion said:
    tenly said:

    No, it is no what is demanded of Apple (and other companies) and no, it is not corrupr, unethical or fraudulent, it is how law is applied and it is ethical and lawful
    Oh it is certainly unethical.  Dodging a social responsibility and shifting a tax burden to others because you have found a clever legal work-around isn't being ethical.
    singularity
  • Reply 73 of 114
    tenly said:
    That definitely wasn't my understanding - and it does change things a little - but only a little.  Ireland is essentially an "authorized representative" of the EU and as such, any agreements they enter into - should be binding.  Consider this analogy we can all understand and tell me how you would react - let's say we are planning a wedding and we select a JW Marrriott hotel for the reception.  We strike up a conversation with the hotel manager and we negotiate a $1500 discount on the price of the ballroom/catering package because we promise to buy 100+ rooms for the night of the wedding to put up our out of town guests.  We follow through with the wedding - we honor our commitment to purchase 105 rooms.  We encourage our guests to book their rooms with the JW even though there is a Hilton directly next door that is half the cost!  But we keep our promise and that hotel does too.  We pay the discounted price for the ballroom and all is well.  Everybody is happy. So happy in fact that you book annual events at the same property and each year you encourage your guests to purchase their rooms from the more expensive Marriott because the hotel manager gives you a discount on the meeting rooms/catering.  BUT THEN --- out of the blue - 5 years after the initial wedding - you get a phone call from Marriott International explaining to you that their hotel manager actually did not have the authority to discounts the conference rooms you had rented and that you would now be required to retroactively pay the full price (plus interest) on all of your events over the past 5 years!

    I don't think that a single one of you would understand Marriott Internationals position and be willing to pay the retroactive charges.  Especially since the hotel enjoyed the benefit in revenue that they received when you fulfilled your side of the agreement and purchased large blocks of rooms for each event!  And I also don't think you would change your mind if they explained that other people whom had their weddings and events at the same venue did not receive any discount - so really you're just paying your fair share anyhow.

    This is exactly what is being demanded of Apple.  Internally within the EU - there should be an approval process in place to ratify/approve any "special" agreements - and if Ireland chooses to bypass that process - they should be held liable.  At the very, very least - the EU should not be allowed to go retroactive for more than a year.  If they can't be bothered to review the special arrangements being offered to certain large corporations within a year of the payment being charged/collected - it's pure and simple negligence on their part - or more than that collusion and deceit.  If the government knows that they can retroactively change the agreement going back 7 or more years - it's in their best financial interest to "let it slide" that long lest the companies move their operations to another jurisdiction!  It's slimey, it's corrupt, it's unethical and it's fraudulent.  Its criminal.

    Ireland are accused of offering a deal to Apple that is against EU law. 
    Ireland is not an "authorised representative" of the EU
    Thus any agreement IF found to be against EU laws will be null.
    IF found to be null Apple will be forced to pay back any tax that was unpaid.
    Currently the time period covered by the potential pay back period is the maximum period covered by EU law, there's no retroactive part. If there was then they could go back even further.
     


    The problem with your theory:  Ireland isn't on the hook for anything. THEY don't owe the EU billions in back taxes. Apple does! That's fraud on the part of Ireland committed against Apple and extortion of Apple by the EU! For their part, Apple legally took advantage of the tangle of Inconsustently applied, BUT STILL LEGAL, EU laws. Everyone knew about it.
    edited January 2016 tenly
  • Reply 74 of 114
    sumergo said:
    cnocbui said:
    If they appeal, I as a put-upon tax payer will ask them loudly why they are doing so as it isn't in my interests nor those of other Irish tax payers that the large US multinationals continue to get away with this unbelievable rort.

    This shouldn't just be about Apple, but all the companies that have had their snouts in the trough.
    A pause for thought here.  If the Irish Government offers tax havens to off-shore companies (as several other governments do) and companies like Apple take the Irish government up on their offer in good faith and invest in the country, providing local jobs etc., for a tax-break, they are not to blame.  If you don't like it, as a put-upon Irish tax payer, don't whine about the companies (and the corporate investment that your government tries to acquire from them) - vote to change this despicable "snout-in-the-trough" government that enables this behaviour.  Sure, be a put-upon Irish tax payer without a job - or maybe, just wake up to the world you actually inhabit.
    Apple, like many other off-shore companies, uses multiple countries as tax havens that are used in complex schemes where money is constantly ferried between accounts in these different countries. Not too long ago there was a really interesting documentary about that here in the Netherlands. One of the things that struck me was that the economic benefit to countries used as tax havens in terms of local jobs and income is marginal. Ireland is the exception here.
  • Reply 75 of 114
    I follow the arguments that Apple hasn't done anything illegal but Ireland, Netherlands and Luxembourg have been skimming off corporation tax revenues due to individual countries in the EU by allowing them to place their sales through a low tax country.  All the big US companies have been playing the game including Amazon, Facebook, Google, Starbucks, GE, Twitter, Hewlett-Packard, Microsoft, Dell, McDonalds, Coca-Cola, the pharmaceuticals...

    Our local bookshop (with just three tiny outlets) paid more UK corporation tax than the whole of Amazon with its £7.6 billion ($10.8 billion) UK turnover.   

    I'm an Apple shareholder with one heck of a lot of my savings in Apple stock but I have to look at the bigger picture and what's fair and equitable, and the current situation with accounting games being played is JUST NOT ON.
  • Reply 76 of 114
    ilondoner said:
    I follow the arguments that Apple hasn't done anything illegal but Ireland, Netherlands and Luxembourg have been skimming off corporation tax revenues due to individual countries in the EU by allowing them to place their sales through a low tax country.  All the big US companies have been playing the game including Amazon, Facebook, Google, Starbucks, GE, Twitter, Hewlett-Packard, Microsoft, Dell, McDonalds, Coca-Cola, the pharmaceuticals...

    Our local bookshop (with just three tiny outlets) paid more UK corporation tax than the whole of Amazon with its £7.6 billion ($10.8 billion) UK turnover.   

    I'm an Apple shareholder with one heck of a lot of my savings in Apple stock but I have to look at the bigger picture and what's fair and equitable, and the current situation with accounting games being played is JUST NOT ON.
    "Fair and equitable" are concepts that do not apply to taxation. Taxes are (and always have been) unequally applied and feed corruption in government or are "income redistribution", which is just plain theft.
  • Reply 77 of 114
    cnocbui said:
    Citizens in the EU have the right to go and live in any other EU country.  Guess what? the vast majority seem to like where they live and stay there.  
    Really?  So why is London the sixth largest French city in the world after Paris, Marseille, Lyon, Toulouse and Nice with between 300,000 and 400,000 French inhabitants?   (Source: http://www.bbc.co.uk/news/magazine-18234930 )

    Currently there are just over 2 million EU-born citizens in legal employment in the UK and one heck of a pile more 'living under the radar'.
    edited January 2016
  • Reply 78 of 114
    ilondoner said:
    ...I'm an Apple shareholder with one heck of a lot of my savings in Apple stock but I have to look at the bigger picture and what's fair and equitable, and the current situation with accounting games being played is JUST NOT ON.
    "Fair and equitable" are concepts that do not apply to taxation. Taxes are (and always have been) unequally applied and feed corruption in government or are "income redistribution", which is just plain theft.
    My 'fair and equitable' comment wasn't aimed at taxation but the relationship between countries which are supposed to be in an EU partnership.  It is not 'fair and equitable' for Ireland, Netherlands and Luxembourg to 'steal' the tax revenues of their EU partners by offering low rates in order to attract US companies to set up headquarters in their tax havens, nor is it 'fair and equitable' for US companies to effectively cheat their hosts out of taxes by creaming off their revenues in this way.   These companies have established multi-billion pound enterprises in the UK, Germany and France and their hosts are being rewarded with nothing.

    It may not be illegal but it IS immoral and is pretty indefensible.
  • Reply 79 of 114
    asdasdasdasd Posts: 5,668member
    Ireland are accused of offering a deal to Apple that is against EU law. 
    Ireland is not an "authorised representative" of the EU
    Thus any agreement IF found to be against EU laws will be null.
    IF found to be null Apple will be forced to pay back any tax that was unpaid.
    Currently the time period covered by the potential pay back period is the maximum period covered by EU law, there's no retroactive part. If there was then they could go back even further.
     


    The problem with your theory:  Ireland isn't on the hook for anything. THEY don't owe the EU billions in back taxes. Apple does! That's fraud on the part of Ireland committed against Apple and extortion of Apple by the EU! For their part, Apple legally took advantage of the tangle of Inconsustently applied, BUT STILL LEGAL, EU laws. Everyone knew about it.
    Ireland will be fined. As it so happens that fine will be less than the tax due to Ireland by Apple but that might not have been the case. As for the legality of it all that's what is being investigated but if Apple and Ireland are found to be in breach of the EU laws on competition - which looks likely - then I can't imagine how you think theses laws are legal but inconsistently applied.  If Apple has to pay back taxes it will be found to have acted illegally.  
  • Reply 80 of 114
    asdasdasdasd Posts: 5,668member
    ilondoner said:
    "Fair and equitable" are concepts that do not apply to taxation. Taxes are (and always have been) unequally applied and feed corruption in government or are "income redistribution", which is just plain theft.
    My 'fair and equitable' comment wasn't aimed at taxation but the relationship between countries which are supposed to be in an EU partnership.  It is not 'fair and equitable' for Ireland, Netherlands and Luxembourg to 'steal' the tax revenues of their EU partners by offering low rates in order to attract US companies to set up headquarters in their tax havens, nor is it 'fair and equitable' for US companies to effectively cheat their hosts out of taxes by creaming off their revenues in this way.   These companies have established multi-billion pound enterprises in the UK, Germany and France and their hosts are being rewarded with nothing.

    It may not be illegal but it IS immoral and is pretty indefensible.
    The unfairness here is the extra deal which at 2% is less than the 12.5%, not the 12.5%. That's considered an internal subsidy.

    The U.K. has a higher corporate rate than Ireland but lower than many other EU countries.
    i don't think there's any desire in the UK  to equalise tax rates across the EU. 
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