Apple Loses Major Tax Dispute in Europe, Must Pay Ireland €13 Billion

[AppliedMicro]

It's not illegal to receive illegal state aid.

That’s why the case was Ireland (“supported” by Apple) against the European Commission - and not Apple.

Apple set up the scheme to dodge taxes - and requested and successfully obtained an advance tax ruling from the Irish tax authority for it - which was found illegal (as in illegal state aid).

 

[cocky jeremy]

For the company alone. Every else gets bent over.

We're all bent over for being taxed to begin with.

 

[iZac]

"Ireland . . . said it will "respect" the Court of Justice's findings and recover the €13 billion"

Oh yes, I'm sure that was a heart-wrenching decision!

 

[jido]

The EU cannot take away a member state sovereignty over taxes, right? I believe the reason for the ruling is that the arrangement unfairly benefited Apple and not other companies, which is why it was outlawed.

 

[rme]

Yup, though EU is somewhat guilty here as well as it was possible to have "0 tax" in some shady member states (Ireland)..
but this loophole is being closed now with minimum CIT across the block (this year I think)

Ireland is one of the least shady countries in the world. https://en.wikipedia.org/wiki/Corruption_Perceptions_Index
Poland on the other hand is worse than some African countries in that respect.

 

[Jamie0003]

Oh no! How will Apple survive??

 

[hans1972]

It's different because Ireland decided to join the EU, and by choosing to do so, agreed to follow their tax rules.

Except the EU doesn't really have tax regulations.

Ireland was convicted for giving Apple illegal state aid.

 

[AppliedMicro]

The EU cannot take away a member state sovereignty over taxes, right?

It can, within the limits Ireland has agreed to by EU accession, when it’s considered state aid.
This is what wording is:

”The tax rulings issued by Ireland on (…) in favour of Apple (…), which enable the latter to determine its tax liability in Ireland on a yearly basis, constitute aid within the meaning of Article 107(1) of the Treaty (on the Functioning of the European Union). That aid was unlawfully put into effect by Ireland in breach of Article 108(3) of the Treaty and is incompatible with the internal market.“

 

[hans1972]

Ireland of course was complicit. The money should not even go to Ireland it should be distributed in all the other European countries where APPLE dodges paying tax by claiming all the income was generated in Ireland when it was not. Ireland set up a sweet heart deal with Apple with a low tax deal and Apple routed all their European income through Ireland. Very dodgy.

Ireland was in fact the one being found guilty for violating EUs regulations on illegal state aid.

Apple wasn't convicted of anything since they didn't do anything illegal. Apple is an innocent third-party which have to pay for Irelands wrongdoing.

 

[BGPL]

Tim, you're one to talk about "political crap" and "false numbers". I wonder if he really believes this or if it's part of his "I care about people and the environment" persona he invented when he took over in 2011. Gotta hand it to him, Tim was woke before it was cool to be woke.

 

[AppliedMicro]

Ireland is one of the least shady countries in the world. https://en.wikipedia.org/wiki/Corruption_Perceptions_Index

Ireland isn’t the only tax haven in the world that scores well on perception of corruption.

That’s why it’s so successful.

 

[rme]

The rules in the Reich are whatever the Reichsmarschall says they are that day.

Indeed. Even basic human rights such as article 19 of the universal declaration of human rights are ignored now in the EU.

https://www.un.org/en/about-us/universal-declaration-of-human-rights

 

[hans1972]

What would you feel about a situation where one US STATE put in place a 1 percent tax rate and then a large company (ie Apple) routed every sale all over the US as if it was made in that one state. Thereby benefiting both the company and the state. Well that is exactly what Apple was doing for years.

This is exactly how the EU works since it's considered a single market!

Let's say a Danish company who manufacturers furniture sells a sofa to a Swedish customers, they don't pay company taxes in Sweden (as a general rule).

 

[AppliedMicro]

Apple is an innocent third-party which have to pay for Irelands wrongdoing.

Apple and their tax advisers concocted the scheme and, on their initiative, obtained the advance tax ruling they wanted.

It’s of course Ireland’s duty to make sure that ruling conforms with EU law - but Apple isn’t merely an innocent third-party in this.

 

[hans1972]

It means exactly that: they dodged taxes.
They set up a structure to dodge taxes in a deal with the tax authorities - and that was found illegal.

No, Ireland was convicted for giving illegal state aid to Apple. The case was between Ireland vs the EU commission. Apple wasn't found guilty of anything as they weren't a direct party to the case. Receiving illegal state aid isn't illegal, but you have to pay it back.

You can't dodge tax if the tax authorities agrees with it. Again this wasn't case about tax dodging.

 

[hans1972]

The lesson is that Apple and IRE knowingly entered into this agreement fully aware it was subject to approval. They tossed the dice and Apple lost but IRE still won.

It wasn't subject to approval. Taxes are not part of the EU and are left to each member state. In this case, a low tax was found to be illegal state aid which is part of EU regulations.

 

[hans1972]

That’s why the case was Ireland (“supported” by Apple) against the European Commission - and not Apple.

Apple set up the scheme to dodge taxes - and requested and successfully obtained an advance tax ruling from the Irish tax authority for it - which was found illegal (as in illegal state aid).

And Ireland was found guilty of giving illegal state aid.
Apple wasn't found guilty of anything.

If you have any evidence for Apple being found guilty of tax evasion by this EU court, please provide a source.

 

[AppliedMicro]

Ireland was convicted for giving illegal state aid to Apple. The case was between Ireland vs the EU commission.

I literally said so above.
I didn’t say that Apple was convicted.

You can't dodge tax if the tax authorities agrees with it

The scheme devised by Apple was intended to dodge taxes legally - but it was found illegal.

Collecting tax and making tax rulings conforming to EU law is of course the that member state’s duty - not Apple’s. That’s why the ruling was made against that member state.

This is exactly how the EU works since it's considered a single market!

Let's say a Danish company who manufacturers furniture sells a sofa to a Swedish customers, they don't pay company taxes in Sweden (as a general rule).

It’s not supposed to work that way in allowing a member state (e.g. Denmark) setting up corporate tax rate.

 

[hans1972]

Apple and their tax advisers concocted the scheme and, on their initiative, obtained the advance tax ruling they wanted.

It’s of course Ireland’s duty to make sure that ruling conforms with EU law - but Apple isn’t merely an innocent third-party in this.

If they aren't innocent, why didn't the EU commission or any other entity prosecute them for this?
What law did Apple break?

 

[macduke]

If only the US were this good at making corporations pay their fair share.

Or the billionaires that get away with by utilizing securities based lending. They never pay taxes because they get a loan out against their investments. Then after a while, their investments go up, so they get a new, bigger loan out against their investments to pay off their old loan against their investments. They only spend as much as they can borrow, and they don’t pay taxes because loans are debt. So they accumulate debt forever, but they never pay it off until they die, because their investments always outpace their debt by a significant margin since these large banks give them very favorable rates, typically only a couple percent. That’s why they need so many billions of dollars, so that if the markets were to absolutely tank, they would still have hundreds of millions to low billions to pay off their loans if needed and still have a golden parachute. And they’ll have a very diversified portfolio so that’s unlikely to happen. We need to close that loophole!

 

[GrayFlannel]

The money to pay has been set aside in an escrow account for years, and has actually accrued quite a bit of interest.

€13bn was in an escrow account for the past six years, awaiting a ruling from the ECJ. The total in the account has fallen from the original €14.3bn as the money was invested in eurozone government bonds, which have dropped in value.

 

[hans1972]

I literally said so above.
I didn’t say that Apple was convicted.

The scheme devised by Apple was intended to dodge taxes legally - but it was found illegal.

Collecting tax and making tax rulings conforming to EU law is of course the that member state’s duty - not Apple’s. That’s why the ruling was made against that member state.

It’s not supposed to work that way in allowing a member state (e.g. Denmark) setting up corporate tax rate.

You said the following: "It means exactly that: they dodged taxes."

Dodge means Apple did something illegal.

But can we agree to that Apple didn't to anything illegal and this case didn't break any law?

 

[AppliedMicro]

If you have any evidence for Apple being found guilty of tax evasion by this EU court

I never said they did.

They came up with a scheme to legally avoid (dodge) tax - which was approved by the tax authority, illegally as ultimately found.

For clarity’s sake, I (too) consider “tax dodging” (example here) “an umbrella term that includes both tax evasion and tax avoidance”.

 

[hans1972]

It’s not supposed to work that way in allowing a member state (e.g. Denmark) setting up corporate tax rate.

Yes, it is. The single market makes it so.

A company in Denmark doesn't have to pay company taxes in other EU countries even if they sell to customers in other countries. A danish company only pays Danish company taxes in such a case.

This is the same as if a company in one US state only paid taxes in that state.

 

[Ramchi]

Now we know why the unusual Monday launch happened!