Apple CEO Tim Cook calls EU tax ruling 'total political crap,' cites potential anti-US sentiment

Posted:
in General Discussion edited September 2016
Apple CEO Tim Cook called the European Commission's recent ruling that left his company saddled with a 13 billion ($14.5 billion) tax bill "total political crap" in an interview published Thursday, suggesting Apple was targeted in the European Union probe.




According to Cook, the ruling was potentially motivated by anti-U.S. sentiment on the part of the EU, reports the Irish Independent.

"I think that Apple was targeted here," Cook said. "And I think that (anti-US sentiment) is one reason why we could have been targeted. People in leadership positions in several countries tell me that this is the agenda. I don't know where that comes from. But what I feel strongly about is that this decision was politically based, of that I'm very confident. There is no reason for it in fact or in law."

Cook also agreed with comments made by U.S. Secretary of Treasury Jack Lew, who said the tax ruling is a blatant grab at taxes owed to the U.S. government.

"I think that's exactly what it is," Cook said. "I think it's a desire to reallocate taxes that should be paid in the U.S. to the EU."

On Tuesday, Apple was ordered to pay $14.5 billion in back taxes plus interest for accepting illegally low tax rates in Ireland over the past ten years. The penalty, the largest ever handed down by the EU's executive body, was the result of an investigation into Apple's "Double Irish" tax loophole that allowed the company to route European profits through two Irish subsidiaries.

The benefit, according to the commission, was effective tax rates of 0.005 percent in 2014 and 1 percent in 2003. As the figures are not in alignment with Ireland's standard tax rate of 12.5 percent, the country is being accused of providing Apple illegal state aid.

"They just picked a number from I don't know where," Cook said. "In the year that the Commission says we paid that tax figure, we actually paid $400m. We believe that makes us the highest taxpayer in Ireland that year."

Apple and Ireland disagree with the commission's decision and have lodged a formal appeal.

Cook believes the commission is taking advantage of the situation in an effort to harmonize tax rates across the EU. By overstepping its granted authority, the EU is jeopardizing amicable trade relationships between member states and the U.S., he said.

The comments closely align with an open letter Cook penned to European customers. In it, the Apple chief says his company pays its fair share of taxes in all jurisdictions, and stresses it did not ask for or receive special privileges in Ireland.

Despite the kerfuffle, Cook affirmed Apple's commitment to Ireland, saying it has no intention of scrapping planned investments in the region. Last week, Apple got the green light to add 1,000 jobs at its headquarters in Cork, a project that calls for the construction of a new office block and supporting amenities. Prior to that, the company recently received approval to build the first phase of a data center in the town of Athenry in County Galway.

"We've been spending a lot of money on building out a large location in Cork," Cook said. "We have a 37-year-old marriage with Ireland and it means something to us. It's a very deep relationship. Every time I go there it brings me such joy. It is an integral part of the company."

Both the Cork expansion and upcoming data center buildout, the latter of which could take 10 to 15 years to complete, are expected to move forward.

"I feel like Ireland stuck with Apple when it wasn't easy to stick with Apple and now we're sticking with Ireland," he said.
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Comments

  • Reply 1 of 196
    I listened to Tim Cook trying to defend Apple's pitifully low tax rate on the BBC news this morning and it just sounded bad. Very bad PR. Attacking the EU is very unwise. All the people whose businesses pay tax at 20% are looking at this and saying why should Apple pay tax at less than 1%.
    As a life-long Apple evangelist, even I find this Apple hard to swallow.
    [Deleted User]cnocbuisingularityrune66austriacuscullyronnsensimdriftmeyerzimmermann
  • Reply 2 of 196
    This ludicrous politically motivated and invasive ruling is why Brexit no longer has any opposition in Great Britain.  Ireland and the rest of Great Britain need to declare their sovereignty and independence from the socialist agenda of the rest of the European Union.  

    Next thing you know, the European commission will want Apple to subsidize Greece and Spain.

    The Department of Justice should punish Europe for this misadventure by prosecuting Volkswagen more aggressively - to the tune of a $75 BILLION fine.  Currently they are handing Volkswagen with kid gloves. But with this turn of events, this should greenlight a big stick punishment that would push Volkswagen to bankruptcy. Take that Europe.
    mwhiteJanNLredefilerlolliverradarthekatredraider11gilly017ai46magman1979monstrosity
  • Reply 3 of 196
    The decision is political, just not in the way he's saying. He wants political to mean 'arbitrary' with a them and us situation. But actually money filtered through these tax havens is through complex subsidiaries is associated with money laundering, tax evasion, organised crime and terrorism. That's the background. I think taxes owed to the US government is the point - Apple keeps its profits off-shore and even tried to lobby for a lower rate before repatriating any of it. Imagine if a Russian or Chinese company did that? Cook has let Apple exceptionalism go to his head. 
    big brother 84cnocbuirune66austriacussensironnmdriftmeyerzimmermann
  • Reply 4 of 196
    I listened to Tim Cook trying to defend Apple's pitifully low tax rate on the BBC news this morning and it just sounded bad. Very bad PR. Attacking the EU is very unwise. All the people whose businesses pay tax at 20% are looking at this and saying why should Apple pay tax at less than 1%.
    As a life-long Apple evangelist, even I find this Apple hard to swallow.
    Same here, I'm generally a fan of Apple and I voted for Brexit so I'm no EU-lover. But I just can't see how anyone can defend what Apple is doing here, for a company that prides itself on making people's lives better, focussing on customers rather than shareholders (apparently), being a eco-friendly company, doing the "right thing" when it comes to slave labour and child labour in china, taking part in charitable donations & events etc. etc. to then claim it's OK to pay 0.005% tax when every other company has to pay 12%+. Especially considering Apple's vast wealth.

    The Irish government as present has not yet appealed - the finance minister stated his intention to but is currently struggling to garner enough support within the government to push it through. Indeed the people of ireland are not looking on this favourably after suffering years of cut-backs and austerity to find the government giving sweetener deals to large multinational companies and possibly REFUSING billions in backdated tax which could pay for schools, housing, hospitals etc. etc. 

    https://www.ft.com/content/2af3003c-6f6c-11e6-a0c9-1365ce54b926

    To an outsider, the United States appear more and more xenophobic with each passing day. If Trump succeeds, I can see USA becoming more like North Korea or to a lesser extent, a mini Russia.
  • Reply 5 of 196
    I don't think that's a good argument for Tim Cook to make, that this is a grab for US taxes, because Apple doesn't PAY US Taxes on those profits and keeps it offshore to avoid paying US Taxes. It's reasonable to argue the ex post facto aspect of this ruling, question the authority - but I think going forward the really sweet deal for taxes is toast. Negotiate a shorter timespan for the back taxes (which means much less money owed) and declare victory.
    rune66austriacuscroprsensironnmdriftmeyerzimmermannjony0
  • Reply 6 of 196
    Cook also agreed with comments made by U.S. Secretary of Treasury Jack Lew, who said the tax ruling is a blatant grab at taxes owed to the U.S. government. "I think that's exactly what it is," Cook said. "I think it's a desire to reallocate taxes that should be paid in the U.S. to the EU."

    The above part is complete and utter BS. Yes, Apple and Ireland made agreements on the amount of tax that Apple would have to pay if they'd choose to use Ireland as their Eu-base of operations. But in no way is that tax owed to the US government. Technically it's not owed to anyone since there's an agreement. But even íf there's tax owed to anyone, then Ireland and Apple need to specify what amount of profit/income was made based on EU-sales. Because there's no way that áll of the taxes made in Ireland, are owed to the US government.

    Having said that: I despise the EU for charging outrageous taxes like that. Ireland made a deal with Apple to improve Ireland's economy. That was done befóre the EU made a vow to stop tax-deals in the EU. If the EU implements these plans after Ireland's deal with Apple, they need to take it up with Ireland. Apple shouldn't be involved or punished for political turbulence (in the EU in this case).

    I despise the EU, even more so because of how they try to punish companies for deals made with countries. But I think Apple is completely missing the point here. Just because you paid 400mil in taxes doesn't mean you're paying a proper amount. 0,005% is still 0,005%, and not the norm for most other companies in Ireland. And the US government certainly doesn't have any right to taxes made by products sold to EU citizens.
    edited September 2016 austriacuscnocbuizimmermannknowitallpropodentropys
  • Reply 7 of 196
    Apple will only start to pay "proper" taxes in the US, if these tax heavens are eliminated. That's what the European Union is after. It just happens to be Apple (a US company) and it happens to be on a massive scale. Remember the billions in fines the Swiss banks had to pay in the US for tax evasion? It's all about trying to keep countries from gaining unfair advantages over other countries. The same way Switzerland had built it's financial system on bank secrecy, Ireland built it's economy on luring international companies with insanely low tax rates. It's not really about Apple or the US, this is about Ireland playing by the rules. Just like Switzerland a few years ago, Ireland is now paying the price for it's actions. And the companies that went along with it get punished. So they should. They knew all along that 1) it's not right, and 2) at some point it would come to light. 
    edited September 2016 singularitycnocbuiaustriacuslarryasensironnmdriftmeyercwingravzimmermann
  • Reply 8 of 196
    If the US Government wanted to tax Apple at a higher percentage, they should have worked to change the law so they could legally pursue the company for the money they believe they are owed.

    I also run a business in California and pay 12-13% in taxes. I do not have the legal power to look for loopholes in the tax legislation that would allow me to launder my money through Ireland.

    It's disappointing that Tim Cook doesn't appear to know the difference between what is legal and what is ethical. 

    It wasn't long ago that homosexuality was illegal in the United States. Would Mr. Cook have modified his personal life to abide by these laws or would he consider them unethical?

    And as for the anti-US sentiment, I call total bullshit... and a shame that he would pull this card at a time when countries in Europe are being hit by terrorist attacks.

    Pay the fine and stop protesting your innocence. It makes Apple look really, really bad.

    And it makes me wonder if Apple's work to "improve the rights of foreign workers" or to "protect the environment" are only being pursued because it is to Apple's fiscal advantage. 

    If it matters, I was born and raised in Ireland, have an Apple tech business and a sister I love who was recently married to her longtime female partner.

    With all that sh*t going on, you'd think I'd be able to swing a better tax deal.

     


    singularityrune66cnocbuiaustriacus[Deleted User]cullybig brother 84sensironnmdriftmeyer
  • Reply 9 of 196
    Cook is making the wrong argument here and his response was just painful to read.
    rune66austriacusequality72521cullysensizimmermannJoeBanks
  • Reply 10 of 196
    crowleycrowley Posts: 10,453member
    This ludicrous politically motivated and invasive ruling is why Brexit no longer has any opposition in Great Britain.
    ???

    There is a huge amount of opposition to exit from the EU in Great Britain, so much so that the Prime Minister is shying away from a Parliamentary vote (which has raised constitutional issues), likely because a motion to invoke Article 50 won't pass.  

    Where did you pull this from?
    edited September 2016 singularitybig brother 84sensironncwingravzimmermannJoeBanks
  • Reply 11 of 196
    I listened to Tim Cook trying to defend Apple's pitifully low tax rate on the BBC news this morning and it just sounded bad. Very bad PR. Attacking the EU is very unwise. All the people whose businesses pay tax at 20% are looking at this and saying why should Apple pay tax at less than 1%.
    As a life-long Apple evangelist, even I find this Apple hard to swallow.
    Fuck the EU.
    Ireland set its tax laws and Apple abided by them and greatly benefitted the country in the process.
    The most Ireland can do now is change their law but asking for back taxes is pure bullshit

    Fuck the companies that choose to pay 20% when 12% and lower is available them in Ireland.
    If these companies are too stupid or too lazy to take advantage of it then I say fuck them.  This is a competitive global economy and the EU is clearly not ready for it.

    The US government and American companies should target the EU back, hit them hard enough to get them dissolved.  To hell with any consequences to be fixed later.
    The EU is an ill conceived organization managed by idiots that should not exist.  The world would be better without them.
    edited September 2016 redefilerapple ][equality72521SpamSandwichradarthekatredraider11latifbpgilly017revolutionentropys
  • Reply 12 of 196
    crowleycrowley Posts: 10,453member

    "I think that's exactly what it is," Cook said. "I think it's a desire to reallocate taxes that should be paid in the U.S. to the EU."
    Wow, that's rich. Set up a corporation with the express intention of avoiding paying taxes in the US or EU, then try and play them off against each other when you get caught.

    Sorry Tim, your hands are slick with red stuff.
    edited September 2016 kernapstersingularityrune66cnocbuicullydacloozimmermannronn
  • Reply 13 of 196
    crowley said:

    "I think that's exactly what it is," Cook said. "I think it's a desire to reallocate taxes that should be paid in the U.S. to the EU."
    Wow, that's rich. Set up a corporation with the express intention of avoiding paying taxes in the US or EU, then try and play them off against each other when you get caught.

    Sorry Tim, your hands are slick with red stuff.
    Get caught abiding by Irish tax laws in Ireland?
    The EU is not ready for the global economy and should be dissolved.
    What the fuck do they think this is?  A Socialist World?
    lolliverequality72521SpamSandwichradarthekatredraider11latifbpgilly017revolutionentropys
  • Reply 14 of 196
    Ireland has made deals like this since the mid 20th century with the airline industry.  It's an overwhelmingly agrarian based economy, as an incentive to attract more diverse industries, they offer tax incentives.  

    For the slower witted who find Cook's comments confusing or outrageous, this is because y'all ignorant of the finer details, and go shooting your fool mouths off like moralizing Puritan zealots, before learning a single thing past your lizard brain reflex.

    This is Irish tax law, and Apple has fully complyied with it.  This is also a long standing practice, and the EU hasn't said a peep about this since the mid 1980s?  Fishy, considering Tim Cook has been meeting with both Democrats and Republicans, while talking about finding a way toward patriating those foreign earnings.  

    Translation for the still confused, angry and dim:  US tax code is broken, and foreign revenue is essentially taxed twice, the second at an outrageous level.  Apple's been working to reform that and get foreign assets home to the US, so pretty obvious Cook thinks the EU timing is suspicious (psssst... its been over 30 years).  Apparently the Secretary of the US Treasury said all this first.  Hardly controversial, unless of course you've replaced rational thought with poorly thought out, collectivist dogma. 
    edited September 2016 lolliver[Deleted User]radarthekatredraider11dewmelatifbpnolamacguyrevolutionentropys
  • Reply 15 of 196
    apple ][apple ][ Posts: 9,233member
    Apple should declare war on the EU!

    What goes around, comes around!

    If a certain entity is going to treat another entity unfairly, then it is only natural that the offended entity retaliate, and reciprocate the favor.

    The EU has become a huge, greedy beast, overriding the decisions taken and made by its members, members that are supposed to be sovereign states.

    What the hell did the Irish revolt against the British for? It seems like it was a complete waste of time, effort and lives, especially seeing how easily they now have surrendered their freedom away.

    The Irish have apparently lost their sovereignty, and they're now ruled by a few corrupt fat cats in Brussels, Germany and elsewhere, and the authoritarian globalists didn't even need to employ any troops or blitzkrieg tactics, in order to achieve their goal.

    If Apple ever has to pay a penny towards this embezzlement scheme, then Apple should promptly raise the prices of virtually all Apple products sold in the EU zone by an appropriate amount, no matter how high the percentage is increased, to compensate for any loss.


    equality72521redraider11latifbprevolutiontallest skil
  • Reply 16 of 196
    Interesting that there are people here calling the EU socialist if all it does is pressing for normal tax rules to apply to everyone no matter if the company is big or small. BTW those taxes are way lower then in the US, so is the US socialist?
    Oh and it appears that the rules are not imposed now but have existed all along, just that Ireland and Apple found ways to work around them which appear to be illegal according to European laws.
    Lets see what will happen. As always there will be a compromise but I think its great that this problem has finally been voiced openly and can only hope the the major countries will agree to close the loopholes!

    edited September 2016 singularityrune66sensizimmermannronnpropod
  • Reply 17 of 196
    jumejume Posts: 209member
    Kind of liked Tim Cook but now I see he's just another hypocrite capitalists trying to maximise profits no matter what...
    This is very bad PR for Apple.
    jpolstersingularityrune66big brother 84sensinikon133
  • Reply 18 of 196
    noelosnoelos Posts: 127member
    This ludicrous politically motivated and invasive ruling is why Brexit no longer has any opposition in Great Britain.  Ireland and the rest of Great Britain need to declare their sovereignty and independence from the socialist agenda of the rest of the European Union.  
    Before you comment on things you clearly know nothing about you should probably be aware that:
    1. There is massive opposition to Brexit in Great Britain. Scotland and Northern Ireland overwhelmingly voted to remain, as did the financial powerhouse of greater London.
    2. Ireland is not a part of Great Britain and hasn't been part of Britain for 100 years.

    Not knowing basic facts, when offering opinion on them, can have a tendency to make one sound like a laughable cretin.
    singularitylolliverfracbig brother 84dacloosensizimmermannronnlogic2.6propod
  • Reply 19 of 196
    redefiler said:
    Ireland has made deals like this since the mid 20th century with the airline industry.  It's an overwhelmingly agrarian based economy, as an incentive to attract more diverse industries, they offer tax incentives.  

    For the slower witted who find Cook's comments confusing or outrageous, this is because y'all ignorant of the finer details, and go shooting your fool mouths off like moralizing Puritan zealots, before learning a single thing past your lizard brain reflex.

    This is Irish tax law, and Apple has fully complyied with it.  This is also a long standing practice, and the EU hasn't said a peep about this since the mid 1980s?  Fishy, considering Tim Cook has been meeting with both Democrats and Republicans, while talking about finding a way toward patriating those foreign earnings.  

    Translation for the still confused, angry and dim:  US tax code is broken, and foreign revenue is essentially taxed twice, the second at an outrageous level.  Apple's been working to reform that and get foreign assets home to the US, so pretty obvious Cook thinks the EU timing is suspicious (psssst... its been over 30 years).  Apparently the Secretary of the US Treasury said all this first.  Hardly controversial, unless of course you've replaced rational thought with poorly thought out, collectivist dogma. 
    Don't forget that Ireland like all EU countries have to comply with EU laws and are not totally independent. The EU has subsidized Ireland a lot and helped them grow their economy over theist years, even saved them from bankruptcy. In any case sure Ireland could leave the EU but what would be the result? Apple would or nay other company could not do European business from there anymore as any law would just apply to revenue they have in Ireland (4.8M people). No European subsidize anymore etc. Not a good deal for them
    In the end we do need a new tax code most relevant countries that profits are taxed where they are generated. That would solve most of these issues

    zimmermannronnfred1357
  • Reply 20 of 196
    This ludicrous politically motivated and invasive ruling is why Brexit no longer has any opposition in Great Britain.  Ireland and the rest of Great Britain need to declare their sovereignty and independence from the socialist agenda of the rest of the European Union..
    No longer any opposition? You must be reading some obscure sources that no one ele has seen. You lost all credibility the moment you said "Ireland and the rest of Great Britain". If you don't understand the difference between the two, you aren't qualified to be making statements like that
    singularityaustriacuscnocbuibig brother 84zimmermannronnfred1357
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