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Apple Could Owe More Than $8 Billion in European Tax Probe
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It kind of smells like a money grab. If Ireland is open to make agreements under normal circumstances with individual companies without the oversight / objection of the EU, then suddenly the EU has a problem....that by itself looks suspicious to me.
Admittedly I know zero about EU / Member countries rights. The timing is just suspect to me. It seems as though everyone thought things were ok until the amount of money at stake was realized. If you don't like the deal you've made or the existing laws....then alter them (and pray they don't get altered any further....sorry all I just had too lol) In the meantime if Apple, or any other company for that matter is operating under legal means and agreements, then leave them alone and negotiate a new deal.
What's wrong with defending an entity that has broken no laws? If Apple broke laws, then the EU should make such an example out of Apple that no one will ever dare even contemplate doing what Apple did. If Apple broke the laws of any particular government, then that government should punish Apple to the fullest extent of the law and ensure that no one else will dare follow Apple. But until I see proof that Apple broke any laws, the cynic in me will see it as reeking of political grandstanding.
Maybe things are done differently in the EU. But a politician is a politician. It's all about the votes. In the US, no one can prove that Apple broke the law. I find it hypocritical that members of the US Congress are trying to pull up Apple for following the very laws that members of Congress took money from lobbyists to pass. I object to politicians' blatant and shameless attempts at scoring political points in the press, trying to make themselves out to be a champion of the people when in reality, they're pretty much selling their votes to the highest bidder.
There is also Google who plays the same game as Apple. And Microsoft etc. Most of these company have registered their businesses in Ireland because of low taxes there.
Anyway, the EU needs the money, because the middle east and african migrants are comming daily in thousands. And the flood will not stop.
Anyway, the EU needs the money, because the middle east and african migrants are comming daily in thousands. And the flood will not stop.
When you are American you believe things are the same in other countries. When you step into another country is just like Twilight zone, everything looks "the same" but underneath everything is totally not. At least Apple has the money to pay, but everything may fall into even having the wrong firm managing your finances in Europe. I do not blame Apple or anybody, things are just plain complicated when you expand, period.
For me, it's the people who are unwilling to do the work that are the greedy people. For people who are willing but unable, I might be more willing to give a few bucks to them until they get back on their feet.
Also, if you get some kind of product or service, you should pay for that service. Apple probably gets the roads, rails & other transportation, police & fire protection, electricity, communication, etc. They should pay for that. The problem with this kind of stuff is what is a reasonable rate of exchange? Apple probably brings in a lot of jobs, which means more personal income tax and employees buy things so they pay sales tax. Does that added tax revenue offset any services Apple gets? I don't know.
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Its not really about defending anything I don't think.
If a company is breaking the law to avoid paying tax, then clearly that's wrong, and they should have to pay any and all tax due.
But if a company is just doing some smart accounting to minimise its tax bill, all perfectly within the law (and by that I mean bona fide, normal accounting procedures, and not some weird tax thing that might be unscrupulous, but still legal, which is probably an even greyer area), then the fault lies with the tax laws in that country and/or global tax laws that allow companies in one country be subject to tax laws in another country.
That principle doesn't magically not hold true because the companies involved are well known multi billion dollar companies.
Kudos to the international tax attorneys on apples payroll.
... Or not allow countries with inconsistent laws into the EU in the first place.
That is, if the EU wanted to make the Union more consistent business environment, they should perhaps have more consistent tax policies/tax incentives among it's membership countries. (ie, part of the membership is to have a consistent tax policy or else you are out)... maybe they have this already, I'm not sure.
Yawn. They probably have $8 billion is spare change in their Apple Car.
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I think the word you are looking for "waste" not "use"
Or at least they feel like the government should get a lot less money to WASTE.
Making use of low Irish taxes is hardly illegal and the whole case smells fishy. Im confident Apple will win this.
^^That. The trouble is fixing the system, with disagreements, petty obstruction, and anything else that involves fair and ethical reforms.
Clever and ethical aren't always synonymous. Am not saying these situations are either, and what's going on can be either, both, or neither.
Apple could owe more than $8 billion in back taxes if the European Commission finds issue with the iPhone maker's corporate tax policies in Ireland, according to analysis by Bloomberg Intelligence.
Apple is one of several multinational corporations that have been scrutinized for corporate tax avoidance in Europe over the past few years. The European Commission began Apple's tax probe in June 2014, and formally accused the iPhone maker of receiving illegal state aid from Ireland three months later.
The company's $64.1 billion in profit generated from 2004 to 2012 could be subject to a 12.5% tax rate, compared to its current foreign tax rate of about 1.8%, depending on the outcome of the investigation. A decision in the probe is expected in Brussels by March, possibly after the 2016 Irish election.
Apple's tax breakdown in Ireland (Image: Bloomberg Intelligence)
Apple operates multiple subsidiary companies in Ireland to pay significantly less tax outside the U.S., where it earns about 55% of its revenue. Apple continues to deny any wrongdoing, and both the company and Ireland vow to take the European Commission to court over any negative verdict.
Last month, Apple agreed to pay 318 million euros in Italy to settle an investigation that accused the company of booking profits generated in Italy through an Irish subsidiary, in an effort to lower its taxable income base and save 879 million euros between 2008 and 2013. Italian regulators concluded that tax probe in March.
Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.
Article Link: Apple Could Owe More Than $8 Billion in European Tax Probe
BBQ their botties ! We have immigrants to pay for.
There is a difference between trying to lower your taxes and avoiding taxes. lol
How many conservatives on Main Street would agree with the elected officials, if the Main Street conservatives actually looked at their preferred official's voting records? Many conservatives, as do some "anti-business liberals" give lots of corporate welfare paid for with tax to companies gutting the US, or at least vote 'no' on issues that would halt government interfering with the free market with those "subsidies".
If the US government did drown in a bathtub (per the quote said by a conservative several years ago), what would take its place?
I've heard it explained this way, not sure if it is entirely accurate, could someone else confirm?
John is headquartered in the US, and sells apples around the world for $1. His cost to produce the apples is $0.20 in China. If he sells an apple to Mary in France, he would owe tax on his profit of $0.80 in France. For simplicity, let's assume the tax rate is 20% in France. Of John's $0.80 profit, he pays France $0.16, leaving him with $0.64 of his original $0.80 profit. If John tries to bring his profit back to the US, it will be taxed again at 20% and he will end up with about $0.51 of his original $0.80 profit.
Now if John gets crafty, he sets up a subsidiary (which he controls) in Ireland to purchase apples from his Chinese supplier for $0.20, from which John buys the apples from at a price of $0.90. When Mary in France purchases an apple from John for $1.00, John has now only made a profit of $0.10 in France, while his subsidiary has made a profit of $0.70 in Ireland. Because the corporate tax rate in Ireland is only 3%, John's subsidiary only ends up paying $0.02 in tax on his $0.70 profit, and $0.02 in tax on his $0.10 profit in France. As of now, with the funds still in the EU John has saved $0.12 in tax on every apple sold, and effectively reduced his tax burden by 75% ($0.04 vs $0.16). Now John knows if he tries to bring his profit of $0.76 back to the US, they're going to tax it at 20%, so instead John just leaves it in Ireland (really a bank in NYC), and the cash piles up.
John is headquartered in the US, and sells apples around the world for $1. His cost to produce the apples is $0.20 in China. If he sells an apple to Mary in France, he would owe tax on his profit of $0.80 in France. For simplicity, let's assume the tax rate is 20% in France. Of John's $0.80 profit, he pays France $0.16, leaving him with $0.64 of his original $0.80 profit. If John tries to bring his profit back to the US, it will be taxed again at 20% and he will end up with about $0.51 of his original $0.80 profit.
Now if John gets crafty, he sets up a subsidiary (which he controls) in Ireland to purchase apples from his Chinese supplier for $0.20, from which John buys the apples from at a price of $0.90. When Mary in France purchases an apple from John for $1.00, John has now only made a profit of $0.10 in France, while his subsidiary has made a profit of $0.70 in Ireland. Because the corporate tax rate in Ireland is only 3%, John's subsidiary only ends up paying $0.02 in tax on his $0.70 profit, and $0.02 in tax on his $0.10 profit in France. As of now, with the funds still in the EU John has saved $0.12 in tax on every apple sold, and effectively reduced his tax burden by 75% ($0.04 vs $0.16). Now John knows if he tries to bring his profit of $0.76 back to the US, they're going to tax it at 20%, so instead John just leaves it in Ireland (really a bank in NYC), and the cash piles up.
COULD?
LOL @ 1.8% TAX. So Tim said that he would NEVER bring the money back into the USA because a 35% tax hit was way too much. OK, I'll bite on that and agree that 35% may be a tad bit too much for a corporation. But, this shows that even 12.5% is way too much for dear old Tim, because he would rather pay 1.8%!!!! Remember when he said any idea of Apple avoiding taxes was "political crap?" Yeah, me too.
If Tim would ever tell the truth, he would let it be known that he's probably miffed they have to pay even 1.8% tax. 0% tax would be much better for growth, and the shareholders.
As if anyone with half a brain doesn't already know, Apple is in Ireland for ONE SINGLE THING-- TO AVOID PAYING TAXES!!!!!!!!!!!!!! Nothing you tell me will ever change my mind on that, so don't even try.
EDIT: And since Apple continues to avoid all these taxes and *still* offers 16 GB storage options on iPhone, I hope they have to pay double the $8 billion. #whatsgoodforthegoose
LOL @ 1.8% TAX. So Tim said that he would NEVER bring the money back into the USA because a 35% tax hit was way too much. OK, I'll bite on that and agree that 35% may be a tad bit too much for a corporation. But, this shows that even 12.5% is way too much for dear old Tim, because he would rather pay 1.8%!!!! Remember when he said any idea of Apple avoiding taxes was "political crap?" Yeah, me too.
If Tim would ever tell the truth, he would let it be known that he's probably miffed they have to pay even 1.8% tax. 0% tax would be much better for growth, and the shareholders.
As if anyone with half a brain doesn't already know, Apple is in Ireland for ONE SINGLE THING-- TO AVOID PAYING TAXES!!!!!!!!!!!!!! Nothing you tell me will ever change my mind on that, so don't even try.
EDIT: And since Apple continues to avoid all these taxes and *still* offers 16 GB storage options on iPhone, I hope they have to pay double the $8 billion. #whatsgoodforthegoose
Ah, I see you're an expert in European law, and work both at Apple (to know they aren't breaking any law) AND the government, since you seem to have a pretty good picture of how it works there.
Why? If that company is playing by the rules and paying their taxes according to the laws, then no problem. They (Apple or any company) should take advantage of every tax loophole they can.
You know these companies that do this (which is many) provides jobs, they provide products and help keep the economy churning. Whereas, here in the US... who knows where the tax dollars go have the time?
Why do all the liberals think it's best to punish the companies that are giving us jobs and keeping the economy going and give it to the governments where most of the time it's wasted on more government. I could never understand that mindset.... other than they really believe all social services should be free and paid for by the "rich" without effecting their own personal income.
and if Apple suddenly has to start paying even more tax i wonder what will happen to the retail price of the Apple products we like so much...........
You do realize many companies do this... it's not just Apple. They are only singled out because of their success.