Apple Expects Appeal of Irish Tax Ruling to Take 'Several Years' With No Impact on Near-Term Financial Results

Discussion in 'Politics, Religion, Social Issues' started by MacRumors, Aug 30, 2016.

  1. MacRumors macrumors bot

    MacRumors

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    Following the European Commission's ruling that Apple received illegal state aid from Ireland, and must pay $14.5 billion in back taxes to the country, the company has published a new FAQ that addresses potential concerns investors may have about the decision and the effect on its bottom line.

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    Apple started out by confirming the decision is not final and that it plans to appeal. The company is "confident" the ruling "will be overturned" by courts in the European Union, but it notes the process is "likely to take several years." In the meantime, Apple does not expect any near-term impact on its financial results.
    Apple added that it does not currently expect the decision to have an impact on its tax rate or cash balance going forward, but the company anticipates it will place an unspecified amount of cash in an escrow account. Apple expects the amount will be reported as restricted cash on its balance sheet.

    The European Commission's ruling followed a three-year inquiry into Apple's tax arrangements in Ireland, where it paid between 0.005% and 1% in taxes from 2003 through 2014, compared to the country's headline 12.5% corporate tax rate. Apple insists it "follows the law and pays all of the taxes" it owes.

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    Article Link: Apple Expects Appeal of Irish Tax Ruling to Take 'Several Years' With No Impact on Near-Term Financial Results
     
  2. SandboxGeneral Moderator emeritus

    SandboxGeneral

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    #2
    "Several years" is kind of what I would have expected given the magnitude of the case.
     
  3. sshambles macrumors 6502a

    sshambles

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    Just curious... how much cash do they have stored in the bank again?
     
  4. TechZeke macrumors 68020

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    They'll honestly make that money back by that time if they actually have to pay. :p
     
  5. Joe Rossignol Editor

    Joe Rossignol

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    Apple held $231.5 billion in cash and marketable securities, partially offset by $68.9 billion in long-term debt, as of its Q3 2016 results reported on July 26.
     
  6. WiiDSmoker macrumors 65816

    WiiDSmoker

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  7. tentales macrumors 6502a

    tentales

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    Let's put it this way, the tax demand is about 6% of their cash on hand. But they'll fight it tooth and nail for years, even if they'll have to spend those 6% on tax attorney fees.
     
  8. thermodynamic Suspended

    thermodynamic

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    $14.5 million less if they didn't cheat?

    But Apple seems confident. Is this because government bureaucracy is slow compared to Apple's own bureaucracy and lobbying for more special snowflake treatment?



    http://www.cultofmac.com/309442/tim-cook-doubled-apples-lobbying-efforts-since-2009/

    https://9to5mac.com/2015/01/20/apple-lobbying-spending/

    http://thehill.com/policy/technology/276290-apple-hires-nfl-lobbyist-for-top-role
    (and we all know how well the NFL is loved right now for its tax exempt status while demanding taxpayers pay for their snowflakey stadiums to take sole profit from, too!)

    http://appleinsider.com/articles/15/01/21/apple-spends-record-41m-to-lobby-us-government-in-2014

    etc
    --- Post Merged, Aug 30, 2016 ---
    It'd be nice if we could pay the same tax rate, at least until whining about infrastructure and other things going under... Well, unlike the rest of us, Apple wholly deserves its 0.005% rate.
     
  9. jonnysods macrumors 603

    jonnysods

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    They will just drag this thing out for years. File the paperwork on the last day etc. There are loads of tactics to avoid this for a long time.
     
  10. sofila macrumors 6502a

    sofila

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    "We'll update the MacPro first". A couple of decades in safe mode
     
  11. apolloa macrumors G4

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    As I understand the money will have to be collected soon, along its interest which makes it a lot more, and then it sits in a fund that cannot be touched by Apple it Ireland or anyone else whilst they go through the appeals process.

    Personally I think Apple firstly being almost fraudulent in its tax payments dodging, and then posting a letter to Europe claiming they are innocent and Ireland was nothing till they showed up, will have lost them some sales.
    We shall see though. You don't bite the hand the feeds you which is EXACTLY what Tim Cook has done today by threatening any further EU investment now because of their tax dodging being exposed. That arrogant American attitude doesn't win over European consumers Tim.
     
  12. MacLawyer, Aug 30, 2016
    Last edited: Aug 30, 2016

    MacLawyer macrumors regular

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    I don't understand EU tax law. It seems Ireland's own laws say what Apple is doing is legal.
     
  13. GigabitEthernet macrumors 6502a

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    #13
    Says Ireland used for research and distribution, yet no value is created there.

    Yes Apple, logic :rolleyes:
     
  14. cube macrumors G5

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    It's like federal law trumping state law in the US.
     
  15. centauratlas macrumors 6502a

    centauratlas

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    Gotta love how Tim Cook advocates for big, authoritarian-style government yet doesn't put his (shareholder's) money where his mouth is.

    Alternatively, perhaps the authoritarians in the EU should become competitive in terms of tax policy instead of using corporations to stealthily raise taxes on the citizens of the EU. Of course, all the people saying, "yeah, sock it too Apple" seem not to realize, they are really saying, "yeah, sock it to everyone buying Apple products - particularly the poor who will pay a much larger percent of their income for these extra taxes. Or not be able to buy the latest tech."

    It is odd how all the supposed champions of the little guy want them to pay more taxes or have to forgo the newest tech. Do they really just want to keep the poor from having the latest tech and the ability to compete with the elites? Perhaps it serves their interests to keep the poor, well, poor.

    Talk about forcing Ireland to change their law after the fact. Ex post facto.
     
  16. iMi macrumors 65816

    iMi

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    More than the U.S. Treasure has on hand at any given moment.
     
  17. Mr. Dee macrumors 68000

    Mr. Dee

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    If Apple had given me all the billions for safe keeping, I would have only used $14,500 out of it.
     
  18. emm386 macrumors 6502

    emm386

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    Rich peoples' problems I wish I had...o_O

    And looking at Apple's excess spare cash, long-term investors should be more worried about that "innovative pipeline" Tim Cook sometimes refers to...
     
  19. twietee macrumors 603

    twietee

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    I doubt the average Apple consumer [in Europe at least] knows who Tim Cook is. I 100% applaud the action but I wouldn't say that it has any impact whether my new laptop is made by Apple or not, for example.

    Starbucks? Now that bullet ismore easy to dodge! :D
     
  20. burgman macrumors 68000

    burgman

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    Scoundrels lobby for favorable laws then hide behind "We followed the law" Piss on you Apple.
     
  21. cube macrumors G5

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    The EU just gave 4 months to recover aid to 4 soccer clubs in Spain.
     
  22. draugminaion macrumors regular

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    #22
    It's not EU tax law, it's EU competition law.
    EU competition law forbids special deals that amount to state aid to companies.
    The state aid happened to have taken the form of reduced taxes.
     
  23. dogslobber macrumors 68040

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    #23
    Often companies need to pay the fine first before an appeal is allowed. This prevents the interest being backdated, which would add a few billions euros if an appeal were to take years. So even the article intro paragraph is likely wrong.
     
  24. ka-spot macrumors 6502a

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    hahahah

    so now they need money - release the new Macbook Pro's ;)
     
  25. jjhny macrumors regular

    jjhny

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    Maybe Tim should update the computer products with that money? He could write it off as a R&D expense. Maybe we could have Macs with technology that is at least current (never mind the premium we pay on top of that because it's Apple made).

    Also, no small business gets that benefit, we all are taxed at 35% on profit and also get eaten alive by incredible amounts of paperwork, record keeping, etc. I have zero sympathy. And what is also this social responsibility nonsense Tim is always spouting? I'd rather he just put faster chips in his machines that blathering on all the time - while paying himself 100 million in stock options.
     

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