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Apple Must Repay $14.5 Billion in Back Taxes, EU Commission Rules
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Now the Irish government are in the odd position of pleading with the EU so that they don't have to accept $13billion in taxes. Meanwhile they are expecting their ordinary citizens to pay more tax and accept punishing austerity measures. This isn't going to end well...
They did, it was 2% , now it apparently is 12.5% retroactively.
If Apple paid what was due under current laws, there's no chance they have to pay 13B euros more now. No chance.
The Commission should have looked into this from the beginning, and prompted Ireland to remove the alleged "state aids" before the bulk of the money started piling up.
The Commission should have looked into this from the beginning, and prompted Ireland to remove the alleged "state aids" before the bulk of the money started piling up.
What's crazy about this is, if you leave Apple out of it - Ireland broke the law (according to the court ruling) and the outcome is... a $14.5 billion cheque.
I assume this won't just go to the Irish government, but will be distributed within the EU? Though that feels like another can of worms.
I assume this won't just go to the Irish government, but will be distributed within the EU? Though that feels like another can of worms.
Agreed. If only the US would do the same as the EU...
But capitalism led to all this corruption in the first place, capitalise to benefit yourself anyway you can, a dodgy government, capitalise on it, more profits for you and your shareholders equals more money for you personally.
Capitalism started out as a good idea, but currently it just seems it's just led to the rich getting richer by screwing everyone else over, legally, and if it's not legal they try to make it so anyway they can.
Everyone is saying this is illegal but it is not. It could be speculated as being state funded aid but you cant prove that. Apple invested in Ireland and the country negotiated a tax rate with the company. It is Ireland that received the lower tax income before Europe ever gets their hands on it, so it is up to them to have said no to Tim and that he must pay them more. But they decided securing jobs and investment with one of the worlds biggest companies for their people was more important that lining the wallets of a Eurocrat.
And have no mistake, this is not a strike for social justice, this is not our law makers sticking it to tax dodgers or giant faceless corporations.... this is all about getting as much money as they can for themselves.
That money should come in and I would say at least 70% should go to the Irish to invest and do with as they deem fit. and Just to spite the EU I would put it all in to developing new research and construction plants for Apple. That way all the EU has done is made Apple increase its presence in Europe and provide more jobs to the Irish people.
However I do hope Apple gets the repeal on one condition. I hope they have the sense to re-evaluate their public standing now with tax laws and decide they will pay a fairer rate. But they need to squash this for the dangerous precedent it sets for EU meddling in the economic affairs of individual nations.
Apple needs to pay more but this is now about more than Apple it is about how the law in Europe works and the standing of countries within the EU to manage their own finances.
Brexit...not looking such a bad thing at the moment....Apple come here we will be cheap =)
And have no mistake, this is not a strike for social justice, this is not our law makers sticking it to tax dodgers or giant faceless corporations.... this is all about getting as much money as they can for themselves.
That money should come in and I would say at least 70% should go to the Irish to invest and do with as they deem fit. and Just to spite the EU I would put it all in to developing new research and construction plants for Apple. That way all the EU has done is made Apple increase its presence in Europe and provide more jobs to the Irish people.
However I do hope Apple gets the repeal on one condition. I hope they have the sense to re-evaluate their public standing now with tax laws and decide they will pay a fairer rate. But they need to squash this for the dangerous precedent it sets for EU meddling in the economic affairs of individual nations.
Apple needs to pay more but this is now about more than Apple it is about how the law in Europe works and the standing of countries within the EU to manage their own finances.
Brexit...not looking such a bad thing at the moment....Apple come here we will be cheap =)
0.005% in 2014. The ruling is also against the Irish Government for not requiring certain big companies to follow their own tax code and keeping to the already low 12.5% tax rate.
Jesus, 0.005%?! I had to rub my eyes at that one.
I couldn't agree more. People on minimum wage pay waaay more than even 1% in tax. It's not right. It's just not right.
If this is true then I am appalled. This isn't just about Apple not paying their taxes it's about competitiveness. Think about all the businesses that didn't have this sweetheart tax situation that found it harder to compete against Apple?
Business should be a level playing field where taxing is regarded. You can't have the biggest player in the world at Phones and Computers paying nothing and all their competitors paying 11% etc that's just ridiculously unfair.
For everyone saying they paid 0.005% in taxes. Yes, but as the current set up stands, they are expecting to pay 15 - 25%, the moment it arrives on US shores.
It's like you earn $100k in a year and your accountant appeals your tax payment (deductions etc) so you are in negotiations with the tax authority for over a year. Well, anyone can say at any point until you pay the tax "come on you have paid 0% tax, that's outrageous", but the point is you are expecting somewhere in the region of 15 - 25% at some point in the future. And indeed that is precisely what is happening now! They are not spending the money, they are fully expecting to pay taxes at some point.
Apple were never intending not to pay the tax. Remember they are still the biggest tax payer in the US. It was just a question of whether they would pay the remaining taxes to the US, Ireland, or the original EU countries (UK, France etc) where product sales were made. They used the "double Irish" loophole offered by the Irish govt to delay paying their taxes and to obfuscate their IP tax residency.
Meanwhile the EU are going after Ireland, not Apple. The EU commissioner has just said on TV that Apple did nothing wrong. It is Ireland, which is effectively offering state subsidies, that is at fault here.
It's like you earn $100k in a year and your accountant appeals your tax payment (deductions etc) so you are in negotiations with the tax authority for over a year. Well, anyone can say at any point until you pay the tax "come on you have paid 0% tax, that's outrageous", but the point is you are expecting somewhere in the region of 15 - 25% at some point in the future. And indeed that is precisely what is happening now! They are not spending the money, they are fully expecting to pay taxes at some point.
Apple were never intending not to pay the tax. Remember they are still the biggest tax payer in the US. It was just a question of whether they would pay the remaining taxes to the US, Ireland, or the original EU countries (UK, France etc) where product sales were made. They used the "double Irish" loophole offered by the Irish govt to delay paying their taxes and to obfuscate their IP tax residency.
Meanwhile the EU are going after Ireland, not Apple. The EU commissioner has just said on TV that Apple did nothing wrong. It is Ireland, which is effectively offering state subsidies, that is at fault here.
It's funny how people still distinguish between one or another "system" these days. The world is now run by the multi-nationals that have bought and payed for the governments they require to conduct business.
Was wealth distribution any better in a communist, fascist, totalitarian, socialist or capitalist system ?
The "actors" are always the same, only the show gets a new name for the proletariat... ahem I meant "consumers".
The latest example of a government/corporate revolving door:
http://corporateeurope.org/revolving-doors/2016/07/barroso-and-goldman-sachs-dangerous-liaison
I meant pay all the tax considering they were just stockpiling the difference anyway.
If you read the actual announcement you can see what kind of a shady scheme Apple were pulling:
Under the agreed method, most profits were internally allocated away from Ireland to a "head office" within Apple Sales International. This "head office" was not based in any country and did not have any employees or own premises. Its activities consisted solely of occasional board meetings. Only a fraction of the profits of Apple Sales International were allocated to its Irish branch and subject to tax in Ireland. The remaining vast majority of profits were allocated to the "head office", where they remained untaxed.
Therefore, only a small percentage of Apple Sales International's profits were taxed in Ireland, and the rest was taxed nowhere.
In 2011, for example (according to figures released at US Senate public hearings), Apple Sales International recorded profits of US$22 billion but under the terms of the tax ruling only around €50 million were considered taxable in Ireland, leaving €15.95 billion of profits untaxed. As a result, Apple Sales International paid less than €10 million of corporate tax in Ireland in 2011 – an effective tax rate of about 0.05% on its overall annual profits
Under the agreed method, most profits were internally allocated away from Ireland to a "head office" within Apple Sales International. This "head office" was not based in any country and did not have any employees or own premises. Its activities consisted solely of occasional board meetings. Only a fraction of the profits of Apple Sales International were allocated to its Irish branch and subject to tax in Ireland. The remaining vast majority of profits were allocated to the "head office", where they remained untaxed.
Therefore, only a small percentage of Apple Sales International's profits were taxed in Ireland, and the rest was taxed nowhere.
In 2011, for example (according to figures released at US Senate public hearings), Apple Sales International recorded profits of US$22 billion but under the terms of the tax ruling only around €50 million were considered taxable in Ireland, leaving €15.95 billion of profits untaxed. As a result, Apple Sales International paid less than €10 million of corporate tax in Ireland in 2011 – an effective tax rate of about 0.05% on its overall annual profits
I'm a big Apple supporter, but this ruling and others like it are long overdue.
It's not that Apple are doing anything particularly unethical. They are merely exploiting loopholes in US and foreign tax laws, just like every other major corporation. This falls under their holy fiduciary responsibility to their shareholders, since corporate profitability has established itself as the new dominating global religion.
Compared to shameless and despicable companies like Verizon and GE, who pay virtually nothing in US taxes, Apple are saints. Nonetheless, this practice must be stopped at the global level to fight back against the "austerity" trend over the last several decades that has been inspired by budget deficits stemming largely from corporate tax avoidance.
"For six years, 2008-2013, Verizon paid ½ of 1% in taxes - on income of more than ½ trillion dollars."
http://www.huffingtonpost.com/bruce-kushnick/verizon-ny-paid-virtually_b_9667024.html
Is Wealth Inequality Hidden in Tax Havens?
http://blogs.wsj.com/economics/2015...n-in-tax-havens-pikettys-co-author-thinks-so/
The Three Biggest Lies about Why Corporate Taxes Should Be Lowered
http://robertreich.org/post/57431623768
It's not that Apple are doing anything particularly unethical. They are merely exploiting loopholes in US and foreign tax laws, just like every other major corporation. This falls under their holy fiduciary responsibility to their shareholders, since corporate profitability has established itself as the new dominating global religion.
Compared to shameless and despicable companies like Verizon and GE, who pay virtually nothing in US taxes, Apple are saints. Nonetheless, this practice must be stopped at the global level to fight back against the "austerity" trend over the last several decades that has been inspired by budget deficits stemming largely from corporate tax avoidance.
"For six years, 2008-2013, Verizon paid ½ of 1% in taxes - on income of more than ½ trillion dollars."
http://www.huffingtonpost.com/bruce-kushnick/verizon-ny-paid-virtually_b_9667024.html
Is Wealth Inequality Hidden in Tax Havens?
http://blogs.wsj.com/economics/2015...n-in-tax-havens-pikettys-co-author-thinks-so/
The Three Biggest Lies about Why Corporate Taxes Should Be Lowered
http://robertreich.org/post/57431623768
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Agreed. No government deserves that much in taxes. Did Irland subsidize the development of assisted features? Access to unexploited materials? Advanced recycling technologies?
All true. And all legal within Ireland. And maybe the EU can make Ireland change what they've decided are unfair tax laws. But you need to explain how Apple broke the law and should have to pay taxes retroactively. If a member state has been chugging along with unfair lax law, then it's obviously the EU's fault for taking their eye off the ball, not Apple's or any other corporation's for exploiting existing law.
Suppose they now close a lot of tax loopholes in the US, or any other country for that matter. Should everyone affected now have to pay back taxes on what they should fairly owe now? This is a bloody dangerous precedent to set.
Money doesn't have morals. At the end of the day, this is Europe trying to compensate their lack of industry.
Nope. The EU has ordered the Irish government to collect the tax. In addition, even if the Irish appeal, they still have to collect the tax anyway and keep it safe in case the appeal wins.
There are no fines under EU State aid rules and recovery does not penalise the company in question. It simply restores equal treatment with other companies. If a Member State decides to appeal a Commission decision, it must still recover the illegal state aid but could, for example, place the recovered amount in an escrow account pending the outcome of the EU court procedures.
And which party do you think would dare to close the offshore profit loophole ? None that I can see.