Apple Must Repay $14.5 Billion in Back Taxes, EU Commission Rules

[xDKP]

The EU legislation has precedence over Irish one in economical and fiscal matters. With this knowledge any other statement of you falls apart on its own. The EU is similar to the US in many things, but also different in many others.
Ireland is a country who belongs to the EU and is subject to the EU legislation. Apple can ignore the EU legislation... but that doesn't mean it is not affected by it (in fact it is actually taking advantage of it because it is avoiding being double taxed when selling in the single market...).

Apple has made a deal with Ireland that is considered, as per EU law, an illegal aid from the Irish state. The EU allows internal tax deals of its members as long as they don't go against the EU legislation, and Ireland went too much into that (and of course Apple didn't care much either since it was benefiting from it).
Now Ireland is obliged to get all the taxes Apple didn't pay when it was supposed to (a pity though that the EU can only go back a decade... but it is a good lesson for Apple and many other companies who consider doing the same in the future).

Note again, Apple was presented with a deal by the Irish government who is subject to EU law (and so is Apple, don't come here saying that Apple signed something with Ireland, if you operate in the EU soil you are subject to every single law from local one to the EU level).

Enjoy Apple, I can't laugh enough at the face of Tim Cook and many US high level people lobbying to get this not to happen. In the EU, we care about taxes, yes. That's why we have such social welfare. If a company makes money on our soil, it will pay every single penny of tax.

Oh... and you clearly didn't get anything about UK voting out (which doesn't mean it will ever happen because it was a non-binding referendum just for your information...). Moreover, those who voted out are precisely the big chunk of population who miss the old empire times and didn't care about the new generations who are actually pro-europeans (as many companies there who will move out should UK enact the corresponding article to leave).
Read a bit... before stating so many untruthful things about this matter and the EU. Clearly you don't know what the EU is.

Take it easy mate. I know very well what the EU is and live with its massive bureaucracy every day. And I know that we love taxation in Europe - Google the Danish tax system, we are some of the highest taxed people in the world. I said I wasn't in the details, so no need to go hating so much...

EU is pretty damn far from perfect and is growing bigger and more complex every day - and for a country like ours - not growing in popularity. And no, I'm 31 and it's not only the elder generations that doesn't love everything coming out of Bruxelles. I have read the voting sides from the UK but that's democracy and should be respected

 

[BaldiMac]

Wow what a confused understanding. They did exactly the opposite they maximised their profits in Ireland by routing all their International income to Ireland. This got them the maximum benefit of the very low tax rate.

Nope. Most of their profits generated in Europe are untaxed. Hence the low effective rate. They are essentially allocated to Apple Inc. in the U.S., but the U.S. doesn't tax those profits until the funds are repatriated.

See the graphic from the EU on this page.
http://www.bloomberg.com/news/artic...5-billion-eu-tax-ruling-what-you-need-to-know

 

[aaronvan]

You are obviously not aware that the Processors in every iPhone and iPad are designed in Europe. You must also not be in a position to afford a great European car like a Benz, Bmw, Ferrari, Lambo, McLaren or many of the others from Europe.

Lambos look like dung beetles from the Crab Nebula. McLaren's are toys for billionaires. Ferrari needs to get back to their elegant roots and stop trying to making supercars. Benz and Beemers are great for trips to the supermarket. I guess the Smart is the best four-wheeled thing coming out of Europe these days.

 

[nebo1ss]

Lambos look like dung beetles from the Crab Nebula. McLaren's are toys for billionaires. Ferrari needs to get back to their elegant roots and stop trying to making supercars. Benz and Beemers are great for trips to the supermarket. I guess the Smart is the best four-wheeled thing coming out of Europe these days.

Thats what you say when you are unable to afford one.

 

[mrex]

Europe doesn't innovate and doesn't make anything of value. However, they certainly enjoy their 30-hour work weeks and retiring at age 45. Extorting billions from a great American company must be an irresistible temptation.

im sorry but Europe isnt going to see those money. money goes to ireland.

and it is not europeans fault that in america everything is valued by money ("this building cost x billions" ... "excuse me, but im more interested in the history and the art of the building not the money you paid.") and people arent willing to pay higher taxes to get same benefits as people get here in europe (public healthcare, free education...) - in america you just love differend types of insurances, private schools etc. it is your choice, dont blame us.

 

[nebo1ss]

I am not even convinced that the Irish Government will appeal this. All the blustering yesterday is one thing but in fact what you have is a minority Government is which totally dependant on other parties to prop it up. The likelihood that they will all agreed on appealing this is small.

 

[jnpy!$4g3cwk]

So many people think this is somehow legal because it was arranged by the government

Maybe putting it like this will help you understand:

Imagine if one of the states of the USA negotiated with a large company to make a law that their employees no longer had the protection of the constitution or bill of rights, and so could be enslaved, saving that company a lot of money

Would you say that was legal because it was authorised by the state? No, because there is a higher (federal) legal authority that says you cannot actually do that

That's what has happened here, and Ireland can appeal all they want but they won't win

Actually, states are allowed to play these games not with individual rights, but, with taxes, in the U.S. And, from some of the accounts, it almost looks like the EU encourages member countries to do their own thing, tax-wise. That is one reason why it is so confusing. The other reason is that it looks like the EU effectively changed the rules retroactively. That is a no-no in the U.S.

 

[cube]

I am not even convinced that the Irish Government will appeal this. All the blustering yesterday is one thing but in fact what you have is a minority Government is which totally dependant on other parties to prop it up. The likelihood that they will all agreed on appealing this is small.

The article I linked states the government could fall because of this debacle.

 

[jnpy!$4g3cwk]

Europe doesn't innovate and doesn't make anything of value. However, they certainly enjoy their 30-hour work weeks and retiring at age 45. Extorting billions from a great American company must be an irresistible temptation.

I hate to break it to you, but, "great American companies" did not invent language, fire, the wheel, paper, Euclidean Geometry, theater, poetry, Algebra, Calculus, the steam engine, the novel, ...

Have you ever had lunch in a cafe in Paris? Climbed a mountain in the Alps? Nevermind.

 

[Sweetfeld28]

Anyone see this Documentary on Corporate Ireland's tax system? Just found it interesting...

Corporate Ireland

 

[aaronvan]

Have you ever had lunch in a cafe in Paris? Climbed a mountain in the Alps? Nevermind.

Yes to both. Hemingway made Paris cafes what they are. Are you suggesting Europeans invented the Alps?

 

[jnpy!$4g3cwk]

Yes to both. Hemingway made Paris cafes what they are. Are you suggesting Europeans invented the Alps?

At least you admitted that a "great American corporation" did not invent the Parisian cafe. That's a step in the right direction. A small step, but, still, a step.

Back On Topic: the issue, to me, is the EU apparently changing the tax rules retroactively. That is a problem. To me. Whether or not the target is a "great American corporation" or an ugly, destructive, coal-burning corporation. An average Joe, or, a billionaire.

 

[apolloa]

I know, I know... anybody who doesn't bash Apple on a daily basis owns some of their stock. Well, I have never owned Apple stock, do not currently own Apple stock, and never plan on owning any Apple stock.

That said, I understand where you're coming from. Break the law, pay the price. If there is any legal documentation showing that corporations agreeing to "illegal" deals with EU members will be punished, then yes, Apple should be punished along with Ireland.

As others have said, Ireland agreed to the EU's anti-business policies, so they should pay the price. Any country that voluntarily surrenders their sovereignty and ability to govern their country as they see fit deserves this kind of thing.

It's big corporations to blame too, Netflix even came out today and said the tax deals big American tech companies are getting are unsustainable! Netflix!
And country's still have their sovereignty as that doesn't have any effect in them using fair rules, rather then tax your people to the hilt whilst charging the richest company on the planet 0.005%, probably the cheapest tax anywhere.
Ive seen today other experts coming out slamming this special deal because it's ridiculous the amount of tax they were paying.
Apple damn well knows exactly what all the international tax laws are and it damn well knew paying 0.005% tax on billions and billions was in clear breach of those laws as did the Irish government. But they carried on regardless.
[doublepost=1472664704][/doublepost]

Europe doesn't innovate and doesn't make anything of value. However, they certainly enjoy their 30-hour work weeks and retiring at age 45. Extorting billions from a great American company must be an irresistible temptation.

You mean apart from the World Wide Web or supersonic air travel or the the first VTOL jet or the jet engine etc etc etc etc....

I suspect so much innovation has come from Europe you can't make a book big enough for it all. Don't go around with your patriotic hat on slamming a continent because a darling corporation is tax dodging.

 

[BaldiMac]

It's big corporations to blame too, Netflix even came out today and said the tax deals big American tech companies are getting are unsustainable! Netflix!
And country's still have their sovereignty as that doesn't have any effect in them using fair rules, rather then tax your people to the hilt whilst charging the richest company on the planet 0.005%, probably the cheapest tax anywhere.
Ive seen today other experts coming out slamming this special deal because it's ridiculous the amount of tax they were paying.
Apple damn well knows exactly what all the international tax laws are and it damn well knew paying 0.005% tax on billions and billions was in clear breach of those laws as did the Irish government. But they carried on regardless.

But why is it ridiculous? What value did Ireland create? Why should all of Apple's European profits by attributed to Ireland and not the U.S.?

Apple's subsidiaries in each European country are basically the equivalent of a retailer like Target. They don't make much profit. Ireland acts like a holding company for Apple Inc's foreign income that keeps the funds in limbo until Apple choose's to repatriate it.

 

[Kabeyun]

This makes wonder. If Ireland was the one at fault for misrepresenting its own tax laws, and Apple followed the letter of the law believing they had done nothing wrong...

Would Apple be eligible to sue Ireland for the money back if they were made to pay up?

Probably not, but an interesting question.

Similarly, you can read about some people in Ireland reconsidering refusing the money given how unexpectedly large the amount is (along the lines of "whoa, let's take that cash and do stuff with it!!"). But tell me: Ireland sets up international corporate tax laws which the EC rules illegal...and for that it gets rewarded $15 billion?? Not much of a malfeasance disincentive. Or does the money go to the ECB or the IMF (and the EU grabs a sovereign country's uncollected tax revenue)??

This is a mess, and clearly a money (the EU is a financial disaster) and power (the EU is teetering on the brink) grab. No reason why the EC would tell Ireland to bring their tax laws in line and move on when they have a chance to tap into the deepest corporate pockets in the world.

 

[vannibombonato]

Yes to both. Hemingway made Paris cafes what they are. Are you suggesting Europeans invented the Alps?

When was it exactly that cheating has become cool in great America?

 

[apolloa]

But why is it ridiculous? What value did Ireland create? Why should all of Apple's European profits by attributed to Ireland and not the U.S.?

Apple's subsidiaries in each European country are basically the equivalent of a retailer like Target. They don't make much profit. Ireland acts like a holding company for Apple Inc's foreign income that keeps the funds in limbo until Apple choose's to repatriate it.

It breached EU competition tax laws and regulations, are you defending this? It's up to the US government to do something about it and they won't, who's fault is that when the EU are clearing up the mess that's been left?

You want taxes in the US, go and lobby your government then, I also don't think you understand what Apple has been doing. I won't explain it as its all out there already. Needless to say it's the exact opposite of what you claim.

 

[BaldiMac]

It breached EU competition tax laws and regulations, are you defending this?

I don't automatically accept the EU's claims. Especially about an arrangement that's been going on for 30 years.

It's up to the US government to do something about it and they won't, who's fault is that when the EU are clearing up the mess that's been left?

What is this "mess"? There is income that the U.S. is entitled to tax. The U.S. defers that tax until the money is repatriated. Nothing in that situation is a "mess" that the EU is entitled to get their hands into.

You want taxes in the US, go and lobby your government then, I also don't think you understand what Apple has been doing. I won't explain it as its all out there already. Needless to say it's the exact opposite of what you claim.

If you think it's the opposite of what I said, than you are simply wrong. Heck, I posted a graphic from the EU that supports what I said.

 

[apolloa]

I don't automatically accept the EU's claims. Especially about an arrangement that's been going on for 30 years.


What is this "mess"? There is income that the U.S. is entitled to tax. The U.S. defers that tax until the money is repatriated. Nothing in that situation is a "mess" that the EU is entitled to get their hands into.


If you think it's the opposite of what I said, than you are simply wrong. Heck, I posted a graphic from the EU that supports what I said.

Ok ok you go away and believe Apple did nothing wrong and no laws were broken by Ireland if it makes you happy. You can enjoy watching Apple getting ripped apart during it's appeal against the EU Competition Commision. It must be nice to believe you know more about European tax law and competition laws then hundreds of highly experienced experts and lawyers.

 

[BaldiMac]

Ok ok you go away and believe Apple did nothing wrong and no laws were broken if it makes you happy. You can enjoy watching Apple getting ripped apart during it's appeal against the EU Competition Commision.

Where does this strawman come from? I never said Apple did nothing wrong. I have no idea what EU tax law looks like.

But that doesn't change the fact that you and others in this thread are wrong about the details. Particularly the claim that Apple negotiated a low tax rate with Ireland. (They didn't.)

I've simply argued that the general arrangement isn't the "ridiculous" "mess" that you've called out. Heck, the lack of proposed penalties should tell you something.

 

[Kabeyun]

It's up to the US government to do something about it and they won't, who's fault is that when the EU are clearing up the mess that's been left?

So is it Italy's responsibility to deal with American Mafia activity? Just askin', as it seems that you're holding the US government responsible for an Irish tax policy.

 

[cube]

Europe doesn't innovate and doesn't make anything of value. However, they certainly enjoy their 30-hour work weeks and retiring at age 45. Extorting billions from a great American company must be an irresistible temptation.

Way to go ignorantly insulting half a billion people.

 

[apolloa]

So is it Italy's responsibility to deal with American Mafia activity? Just askin', as it seems that you're holding the US government responsible for an Irish tax policy.

No I did not say or imply that, I said it's Americas own fault for not getting the money of Apple, the only reason Apple won't being it back to America is to dodge paying the 33% tax it'll be charged.
The US government can make changes whenever they want. The EU is clearing up the mess all this illegal tax dodging has caused, and if you read all the news about it you'll also realise European companies as well as American ones are in the firing lines.

 

[cube]

What a surprise:

http://www.irishtimes.com/business/...-tell-eu-to-f-k-off-michael-o-leary-1.2774314

 

[VulchR]

I think the US government is interpreting this all wrong. In the US, the states are allowed to set their taxes, For instance the I-95's meandering through Delaware, generating funds from tolls, allows the state to forego many taxes that other states levy. However, in the EU luring corporations to a given country through state aid is perceived as unfair competition within the EU. This is not about the relationship between the EU and the US. It is about the relationship of Ireland to other EU countries. The Irish government might not want that money from Apple, but as night follows day the EU will cut subsidies to Ireland to match the amount that Apple should have paid in taxes.

The fault is the Irish government's, but Apple is culpable. I mean, seriously, Apple thought it was OK to pay <1% in taxes during an economic epoch of austerity and social welfare cutbacks? Get real.