With $231B in cash, Apple's $14.5B EU tax hit doesn't concern Wall Street

13

Comments

  • Reply 41 of 67
    latifbplatifbp Posts: 544member
    knowitall said:
    Apple can pay that amount, that's clear to anyone, but moral damage could be far worse.
    If Apple isn't perceived as a morally right company but instead as a money machine only, people could boycot Apple and search for (much cheaper) alternatives.
    Microsoft got hammered by the EU (also a multi billion case) and wasn't the better for it; once convicted always a criminal.

    A good example is AH in holland (very big in the US also) they got into 'extorting' the suppliers because they had all the power.
    At some point the public became aware of that and boycotted AH (by not buying); AH reversed its 'policy' almost immediately ...
    It's the EU who's looking like a greedy money grubbing welfare hog
    Capriguy
  • Reply 42 of 67
    latifbplatifbp Posts: 544member
    cnocbui said:
    If I go into a shop and buy an iPhone, I will pay 23% vat.  Apple is asked to pay 12.5%, but they are the ones being 'robbed'.  Amazing.
    It'll keep going up for you even more once Apple has to increase prices in Europe if this ever goes through. You can bet Apple's money will not be invested further than they already are there in Europe. Can't wait until you feel the effects
    Capriguy
  • Reply 43 of 67
    crowleycrowley Posts: 9,111member
    latifbp said:
    knowitall said:
    Apple can pay that amount, that's clear to anyone, but moral damage could be far worse.
    If Apple isn't perceived as a morally right company but instead as a money machine only, people could boycot Apple and search for (much cheaper) alternatives.
    Microsoft got hammered by the EU (also a multi billion case) and wasn't the better for it; once convicted always a criminal.

    A good example is AH in holland (very big in the US also) they got into 'extorting' the suppliers because they had all the power.
    At some point the public became aware of that and boycotted AH (by not buying); AH reversed its 'policy' almost immediately ...
    It's the EU who's looking like a greedy money grubbing welfare hog
    Even though the tax repayment won't be to the EU, but to Ireland?

    Show an ounce of logic, please.
    cnocbuisingularity
  • Reply 44 of 67
    e1618978e1618978 Posts: 6,075member
    What happens to Ireland if they refuse to tax Apple?  i.e. what is the "or else" part of this demand that gives the EU power?
    anantksundaramCapriguy
  • Reply 45 of 67
    crowley said:
    sog is claiming to be a CPA now? smiley 

    Don't  believe that for a second, and if by some miracle it is true then his habit of pulling numbers out of his ass and then being unable to add them together in the right way bodes very badly for a venerable profession.
    Ah. An ad hominem. The last refuge of a spent argument.

    I recall that you've positioned yourself in many a past comment (not in this thread) as someone who knows a bit of finance. In fact, I recall that many of them were spot on (not in this thread, unfortunately). Care to tell us what it incorrect with @sog35's description of the meaning of cash taxes paid (and the resulting tax rate) as derived from a firm's cash flow statement?

    I'll wait.
    edited August 2016 latifbpCapriguy
  • Reply 46 of 67
    sog35 said:
    marktime said:
    This is really a non-issue for Apple. Foreign taxes paid are a credit against Apple's US tax liability. Assuming that at some point Apple repatriates its cash to the US, as long as the marginal US tax rate at that time is greater than what the EU is claiming this won't have any impact on Apple's overall tax liability. Apple has never been against repatriating the money, they have been against paying a 35% tax rate when their competitors (Samsung et. al.) get to pay a much lower than the rate. At a 20% rate I'm sure Tim Cook would bring a lot of that cash back to the US.

    Otoh, whatever is paid to the EU is tax money that the US won't collect. This is more of a grab by the EU on money that would otherwise end up in the US Treasury. You would think that the US would be a lot more energetic in fighting the EU on this.

    Exactly. The only ones getting SCREWED are US Citizens.

    The EU is basically stealing $15,000,000,000 from US Citizens.
    According to the EU commission Apple and Ireland have stolen 13billion euros from the Irish people.
    ... which, a government that represents the "Irish people" doesn't seem to want. Go figure.
    latifbpCapriguy
  • Reply 47 of 67
    sog35 said:
    marktime said:
    This is really a non-issue for Apple. Foreign taxes paid are a credit against Apple's US tax liability. Assuming that at some point Apple repatriates its cash to the US, as long as the marginal US tax rate at that time is greater than what the EU is claiming this won't have any impact on Apple's overall tax liability. Apple has never been against repatriating the money, they have been against paying a 35% tax rate when their competitors (Samsung et. al.) get to pay a much lower than the rate. At a 20% rate I'm sure Tim Cook would bring a lot of that cash back to the US.

    Otoh, whatever is paid to the EU is tax money that the US won't collect. This is more of a grab by the EU on money that would otherwise end up in the US Treasury. You would think that the US would be a lot more energetic in fighting the EU on this.

    Exactly. The only ones getting SCREWED are US Citizens.

    The EU is basically stealing $15,000,000,000 from US Citizens.
    According to the EU commission Apple and Ireland have stolen 13billion euros from the Irish people.
    ... which, a government that represents the "Irish people" doesn't seem to want. Go figure.
    Well, the EU knows what's good for those stupid Irish peasants.
    latifbpCapriguy
  • Reply 48 of 67
    maestro64 said:

    Yeah is does not matter what the EU says, this is why the market is not reacting and probably pissing the EU off.

    To put it into perspective. It would be like the FTC in the US telling California they need to tax Apple more because they gave Apple unfair tax advantage which allow them to compete better in the rest of the US states. No entity in the US including congress or president can force any state to change their tax laws. State give company all kinds of tax incentives for company to do business in their state. The only thing the US government could do is not share federal tax with California. But Brussels does not collect taxes so they have nothing to hold over Ireland other than to say they will try and make thing hard for them.

    I think you need to learn how the EU and Europe works, it's very, very different to the USA.
  • Reply 49 of 67
    sog35 said:
    Gymkhana said:
    Pay your fair share, Apple.  You've benefited from "the commons", in all ways and shapes.  There's no free lunch.  You've used the skies, the shipping lanes, the international and national court systems, multiple nations' militaries, the water, electricity, natural resources.  It's time you paid your fair share for those "freebies", just like the rest of us.  Used to be that corporations carried much of the US tax burden, shielding the people from much of it.  That's flipped around, we all work to support the corporations now.  It's insane.  We only ask what is fair, and what's fair is that you pay the same effective income tax rate of between 20 and 35%, like we all do.  If corporations are people, as ruled by the less-than-Supreme Court, then Apple should not object to paying their fair share, as another law abiding citizen.
    what is a fair share? Who determines what is fair? You?

    Apple followed every single Irish tax law. They broke no laws. 

    And Apple's company wide effective tax rate is 25% .  The average common person on the planet pays no where close to 25% tax. In the USA about 45% of the tax payers pay ZERO federal taxes.

    And the profits that Apple makes is TAXED AGAIN when dividends are paid or stock is sold.  The tax rate on Apple owners is 40-50%.  That's more than enough taxes.

    Lets say Apple makes $1,000.
    Apple pays 25% corporate tax or $250.
    Then that $750 gets distributed to shareholders with dividends or shareholders sell stock. That gets taxed at 20-35%
    That leaves only about $550 for the owners of Apple.
    So all together Apple owners pay 45% tax rate.

    But you welfare losers want Apple and its owners to pay more than 45% tax rate. Ridiculous
    What Apple did in Europe however (note, somewhere outside of the mighty USA) was pay a measly 0.005% tax in recent years when the standard rate to other businesses in Ireland was around 12.5%. And this wasn't just on profits made IN Ireland, it was on all profits made across Europe, so UK/Germany/France/Spain etc. etc. gained very little benefit from being markets that Apple were present in other than the taxes on the end-product sales, VAT in the UK for example. Which is passed on to the consumer anyway in the RRP.

    Apple followed and abided by Irish Law, yes, but that Law in itself was illegal under EU competition rules which Ireland signed up to when they joined the EU. Any financial advisor worth his wage (especially one working for one of the world largest companies) should and would have known about EU regulations and laws when they agreed to this tax deal. 

    It may work in America where states can offer competitive rates legally to gain an advantage over other states - this practice however is outright illegal for EU member states. 

    And I'm not bashing Apple specifically here, many many companies do this and will be brought to task in due course. Starbucks and Fiat were first, Apple just now, Google and Amazon etc. are all under investigation for similar tax arrangements.
  • Reply 50 of 67
    cnocbuicnocbui Posts: 3,613member
    e1618978 said:
    What happens to Ireland if they refuse to tax Apple?  i.e. what is the "or else" part of this demand that gives the EU power?
    What I have read suggests that if Ireland refuses, it would be hit with €13 Billion in fines payable to the EU Commission.  What actually might happen is that over the course of however many years it would take, The EU would withold 13B worth of payments Ireland otherwise would have received.  The effect on the country would be far more severe than Apple pulling up sticks and leaving.  There isn't an icecream's chance in hell of Ireland not abiding by any final post-appeal ruling.
    singularitye1618978
  • Reply 51 of 67
    latifbplatifbp Posts: 544member
    cnocbui said:
    marktime said:
    This is really a non-issue for Apple. Foreign taxes paid are a credit against Apple's US tax liability. Assuming that at some point Apple repatriates its cash to the US, as long as the marginal US tax rate at that time is greater than what the EU is claiming this won't have any impact on Apple's overall tax liability. Apple has never been against repatriating the money, they have been against paying a 35% tax rate when their competitors (Samsung et. al.) get to pay a much lower than the rate. At a 20% rate I'm sure Tim Cook would bring a lot of that cash back to the US.

    Otoh, whatever is paid to the EU is tax money that the US won't collect. This is more of a grab by the EU on money that would otherwise end up in the US Treasury. You would think that the US would be a lot more energetic in fighting the EU on this.
    If the US chooses to view this as the EU grabbing 'their' taxes and takes punative action, it will be the end of globalisation and we will see a return to a world of quotas, high tarrifs, subsidies and trade restrictions.

    Apple siphoned AU$23 billion from the Australian economy via it's Irish subsidiary.  Apple only paid the Australian Tax Office 0.07% of that in tax.  Countries simply can not afford to let the US hose their economies like that for long without taking preventative measures.  I am sure the US government is about to embark on a course to try and preserve this state of affairs but they can only fail
    It's spelled punitive, with an i. You continue to spell this word wrong over and over
  • Reply 52 of 67
    latifbplatifbp Posts: 544member

    crowley said:
    latifbp said:
    knowitall said:
    Apple can pay that amount, that's clear to anyone, but moral damage could be far worse.
    If Apple isn't perceived as a morally right company but instead as a money machine only, people could boycot Apple and search for (much cheaper) alternatives.
    Microsoft got hammered by the EU (also a multi billion case) and wasn't the better for it; once convicted always a criminal.

    A good example is AH in holland (very big in the US also) they got into 'extorting' the suppliers because they had all the power.
    At some point the public became aware of that and boycotted AH (by not buying); AH reversed its 'policy' almost immediately ...
    It's the EU who's looking like a greedy money grubbing welfare hog
    Even though the tax repayment won't be to the EU, but to Ireland?

    Show an ounce of logic, please.
    Other EU countries now have a window to claim they should get a part of this ruling. Plenty of logic there huh?

    "On Tuesday, the European Commission handed down a record tax penalty, ordering Apple to pay 13 billion euros ($14.5 billion) to Ireland in back taxes, offset if other E.U. countries seek part of the pay-out. In its investigation, the regulatory group claimed that tax rates on European profits were illegally low at 0.005 percent in 2014, and 1 percent in 2003."
    edited August 2016
  • Reply 53 of 67
    cnocbuicnocbui Posts: 3,613member
    latifbp said:
    cnocbui said:
    marktime said:
    This is really a non-issue for Apple. Foreign taxes paid are a credit against Apple's US tax liability. Assuming that at some point Apple repatriates its cash to the US, as long as the marginal US tax rate at that time is greater than what the EU is claiming this won't have any impact on Apple's overall tax liability. Apple has never been against repatriating the money, they have been against paying a 35% tax rate when their competitors (Samsung et. al.) get to pay a much lower than the rate. At a 20% rate I'm sure Tim Cook would bring a lot of that cash back to the US.

    Otoh, whatever is paid to the EU is tax money that the US won't collect. This is more of a grab by the EU on money that would otherwise end up in the US Treasury. You would think that the US would be a lot more energetic in fighting the EU on this.
    If the US chooses to view this as the EU grabbing 'their' taxes and takes punative action, it will be the end of globalisation and we will see a return to a world of quotas, high tarrifs, subsidies and trade restrictions.

    Apple siphoned AU$23 billion from the Australian economy via it's Irish subsidiary.  Apple only paid the Australian Tax Office 0.07% of that in tax.  Countries simply can not afford to let the US hose their economies like that for long without taking preventative measures.  I am sure the US government is about to embark on a course to try and preserve this state of affairs but they can only fail
    It's spelled punitive, with an i. You continue to spell this word wrong over and over
    That should be: "You continue to spell this word 'incorrectly', repeatedly" or "You continue to 'misspell' this word..."
    singularitygatorguy
  • Reply 54 of 67
    crowleycrowley Posts: 9,111member
    crowley said:
    sog is claiming to be a CPA now? smiley 

    Don't  believe that for a second, and if by some miracle it is true then his habit of pulling numbers out of his ass and then being unable to add them together in the right way bodes very badly for a venerable profession.
    Ah. An ad hominem. The last refuge of a spent argument.

    I recall that you've positioned yourself in many a past comment (not in this thread) as someone who knows a bit of finance. In fact, I recall that many of them were spot on (not in this thread, unfortunately). Care to tell us what it incorrect with @sog35's description of the meaning of cash taxes paid (and the resulting tax rate) as derived from a firm's cash flow statement?

    I'll wait.
    No idea, I'm no accountant, and I have sog in my ignore list so I'm not privy to the detail of the diatribes, only the little bits (that I mostly gloss over) that I glimpse in other people's quotes.

    It's hardly an ad hominem, since I'm not arguing with sog, just dismissing the appeal to sog's own authority since there has been an evident disposition to be fast and loose with numbers in the past.  That applies whether or not sog is actually a CPA, though I doubt it to be true. S/he's got very little credibility after reneging on self-ban promises, making up number, and flip flopping all over the place.
    singularitygatorguy
  • Reply 55 of 67
    crowleycrowley Posts: 9,111member
    latifbp said:

    crowley said:
    latifbp said:
    knowitall said:
    Apple can pay that amount, that's clear to anyone, but moral damage could be far worse.
    If Apple isn't perceived as a morally right company but instead as a money machine only, people could boycot Apple and search for (much cheaper) alternatives.
    Microsoft got hammered by the EU (also a multi billion case) and wasn't the better for it; once convicted always a criminal.

    A good example is AH in holland (very big in the US also) they got into 'extorting' the suppliers because they had all the power.
    At some point the public became aware of that and boycotted AH (by not buying); AH reversed its 'policy' almost immediately ...
    It's the EU who's looking like a greedy money grubbing welfare hog
    Even though the tax repayment won't be to the EU, but to Ireland?

    Show an ounce of logic, please.
    Other EU countries now have a window to claim they should get a part of this ruling. Plenty of logic there huh asshole?

    "On Tuesday, the European Commission handed down a record tax penalty, ordering Apple to pay 13 billion euros ($14.5 billion) to Ireland in back taxes, offset if other E.U. countries seek part of the pay-out. In its investigation, the regulatory group claimed that tax rates on European profits were illegally low at 0.005 percent in 2014, and 1 percent in 2003."
    Which still won't go to the EU itself, even if other countries put a claim in, which seems dubious.
  • Reply 56 of 67
    latifbplatifbp Posts: 544member
    adm1 said:
    maestro64 said:

    Yeah is does not matter what the EU says, this is why the market is not reacting and probably pissing the EU off.

    To put it into perspective. It would be like the FTC in the US telling California they need to tax Apple more because they gave Apple unfair tax advantage which allow them to compete better in the rest of the US states. No entity in the US including congress or president can force any state to change their tax laws. State give company all kinds of tax incentives for company to do business in their state. The only thing the US government could do is not share federal tax with California. But Brussels does not collect taxes so they have nothing to hold over Ireland other than to say they will try and make thing hard for them.

    I think you need to learn how the EU and Europe works, it's very, very different to the USA.
    Yep. The EC is the new Mussolini. We helped you did your continent of Fascism once. You're on your own this time.
    Capriguy
  • Reply 57 of 67
    SpamSandwichSpamSandwich Posts: 33,408member
    adm1 said:
    sog35 said:
    Gymkhana said:
    Pay your fair share, Apple.  You've benefited from "the commons", in all ways and shapes.  There's no free lunch.  You've used the skies, the shipping lanes, the international and national court systems, multiple nations' militaries, the water, electricity, natural resources.  It's time you paid your fair share for those "freebies", just like the rest of us.  Used to be that corporations carried much of the US tax burden, shielding the people from much of it.  That's flipped around, we all work to support the corporations now.  It's insane.  We only ask what is fair, and what's fair is that you pay the same effective income tax rate of between 20 and 35%, like we all do.  If corporations are people, as ruled by the less-than-Supreme Court, then Apple should not object to paying their fair share, as another law abiding citizen.
    what is a fair share? Who determines what is fair? You?

    Apple followed every single Irish tax law. They broke no laws. 

    And Apple's company wide effective tax rate is 25% .  The average common person on the planet pays no where close to 25% tax. In the USA about 45% of the tax payers pay ZERO federal taxes.

    And the profits that Apple makes is TAXED AGAIN when dividends are paid or stock is sold.  The tax rate on Apple owners is 40-50%.  That's more than enough taxes.

    Lets say Apple makes $1,000.
    Apple pays 25% corporate tax or $250.
    Then that $750 gets distributed to shareholders with dividends or shareholders sell stock. That gets taxed at 20-35%
    That leaves only about $550 for the owners of Apple.
    So all together Apple owners pay 45% tax rate.

    But you welfare losers want Apple and its owners to pay more than 45% tax rate. Ridiculous
    What Apple did in Europe however (note, somewhere outside of the mighty USA) was pay a measly 0.005% tax in recent years when the standard rate to other businesses in Ireland was around 12.5%. And this wasn't just on profits made IN Ireland, it was on all profits made across Europe, so UK/Germany/France/Spain etc. etc. gained very little benefit from being markets that Apple were present in other than the taxes on the end-product sales, VAT in the UK for example. Which is passed on to the consumer anyway in the RRP.

    Apple followed and abided by Irish Law, yes, but that Law in itself was illegal under EU competition rules which Ireland signed up to when they joined the EU. Any financial advisor worth his wage (especially one working for one of the world largest companies) should and would have known about EU regulations and laws when they agreed to this tax deal. 

    It may work in America where states can offer competitive rates legally to gain an advantage over other states - this practice however is outright illegal for EU member states. 

    And I'm not bashing Apple specifically here, many many companies do this and will be brought to task in due course. Starbucks and Fiat were first, Apple just now, Google and Amazon etc. are all under investigation for similar tax arrangements.
    And this is just one reason why the EU continues to be an utter dumpster fire.
    latifbpCapriguy
  • Reply 58 of 67
    crowleycrowley Posts: 9,111member
    latifbp said:

    We helped you did 
    Is that more of your "casual Englush"?
    cnocbui
  • Reply 59 of 67
    gatorguygatorguy Posts: 23,302member
    crowley said:
    latifbp said:

    crowley said:
    latifbp said:
    knowitall said:
    Apple can pay that amount, that's clear to anyone, but moral damage could be far worse.
    If Apple isn't perceived as a morally right company but instead as a money machine only, people could boycot Apple and search for (much cheaper) alternatives.
    Microsoft got hammered by the EU (also a multi billion case) and wasn't the better for it; once convicted always a criminal.

    A good example is AH in holland (very big in the US also) they got into 'extorting' the suppliers because they had all the power.
    At some point the public became aware of that and boycotted AH (by not buying); AH reversed its 'policy' almost immediately ...
    It's the EU who's looking like a greedy money grubbing welfare hog
    Even though the tax repayment won't be to the EU, but to Ireland?

    Show an ounce of logic, please.
    Other EU countries now have a window to claim they should get a part of this ruling. Plenty of logic there huh asshole?

    "On Tuesday, the European Commission handed down a record tax penalty, ordering Apple to pay 13 billion euros ($14.5 billion) to Ireland in back taxes, offset if other E.U. countries seek part of the pay-out. In its investigation, the regulatory group claimed that tax rates on European profits were illegally low at 0.005 percent in 2014, and 1 percent in 2003."
    Which still won't go to the EU itself, even if other countries put a claim in, which seems dubious.
    Italy already sued Apple and made a separate agreement with them on paying proper Italian taxes in the future so I don't think they would be one of those making a claim on the Ireland recovery. Belgium on the other hand, along with France, well may. Probably Germany too. If so the floodgates might open. 
    edited August 2016
  • Reply 60 of 67
    latifbplatifbp Posts: 544member
    crowley said:
    latifbp said:

    We helped you did 
    Is that more of your "casual Englush"?
     We all make mistakes while typing in our flurry to comment. Cocknob was spelling punitive with an a in every post in the past couple of months. Sheesh!
    Capriguy
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