No one should care, but to have a reasonable discussion on the topic you need to consider and understand Apples motivations. None of this is about what you think personally.
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Dutch Regulator Says Apple Shouldn't Force Dating Apps to Offer Separate App for Alternative Payments
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Yes. I've not only heard of it, but I understand what it means. It doesn't mean that Apple pays less than 1% on EU profits. What it means is they are able to defer tax payments on revenue that they intend to repatriate to the US where the value for Apple products is created.Jeez, you never heard of “Double Irish with a Dutch Sandwich”?
Apples paid Tax has no weight. If they leave NL or EU, economically nobody will cry, except Apple, a few fanatics, and their shareholders.
Here again extra for you:
The Double Irish Dutch Sandwich finally explained
Google makes an announcement saying they are going to abandon the Double Irish Dutch Sandwich arrangement. Here's a Finshots explainer simplifying this.finshots.in
And a cartoon and diagram, for easier understanding:
View attachment 1959193
View attachment 1959197
So for all their profits around the world they either 1) pay taxes in the US 2) pay taxes in the country where the profits were generated, or 3) using the Irish subsidiary, defer tax payments on money that will be taxed when it is repatriated or used to fund local operations.
All their profits are or will be taxed at the appropriate local rate.
Someobdy already posted in here a screenshot of what app developers pay for developing their apps, the development tools and API's they are allowed/given to use in development of those apps and general use of the app store. EVERY app developer pays that yearly fee and ALL of them have access to all the same tools and use of the store.
The ONLY difference between the developers who develope their apps for free and those who don't is the commision app developers have to pay if they want to have in-app purchases (IAP). That is the ONLY difference.
This is why Apple, in my opinion is fighting the Dutch ACM so hard on this because Apple knows if they lose and allow app developers to design their apps to give consumers the choice of which payment system they would like to use, Apple stands to loose billions of $$$ because they know the majority of iphone owners would use 3rd party payment system (paypal, credit card, western union to name a few) which would mean their own payment system is not being used and thus no commision paid. This is also why Apple is trying to invent new ways for the commision to be paid if another payment system is used.
And as for the notion that Apple would pull out of the Netherlands if they was to lose. Could you just see the media headlines 'Trillion dollar company Apple throws toys out the pram in not getting it's own way, fights for profits rather than customer rights, the right to chose who they want to use for their payment system' or words to that effect. It would be a PR diaster for Apple.
The ONLY difference between the developers who develope their apps for free and those who don't is the commision app developers have to pay if they want to have in-app purchases (IAP). That is the ONLY difference.
This is why Apple, in my opinion is fighting the Dutch ACM so hard on this because Apple knows if they lose and allow app developers to design their apps to give consumers the choice of which payment system they would like to use, Apple stands to loose billions of $$$ because they know the majority of iphone owners would use 3rd party payment system (paypal, credit card, western union to name a few) which would mean their own payment system is not being used and thus no commision paid. This is also why Apple is trying to invent new ways for the commision to be paid if another payment system is used.
And as for the notion that Apple would pull out of the Netherlands if they was to lose. Could you just see the media headlines 'Trillion dollar company Apple throws toys out the pram in not getting it's own way, fights for profits rather than customer rights, the right to chose who they want to use for their payment system' or words to that effect. It would be a PR diaster for Apple.
If you think what regulators decide won't be influenced by what Apple has done when Apple's actions are the very motivation they decided to start regulating this industry in the first place, I really don't know what to tell you.
All regulations arise as remedies to observed problems in the market place - and Apple is the creator of many of these problems because of their insistence of being a gatekeeper while maximizing profit.
I think many of us know Apples motivations which is all about money and profits at the expense of consumer choice.
Absolutely Apple are morally and ethically compelled to protect their revenue and will continue to charge as much as possible within the scope of what the law allows.
What came first, the importance of the app market or Apple having this level of control on the iOS App Store? The App Store was lauded as a huge win for consumers and developers when it first became available in 2008 and since then Apple have made their terms of business more favourable to developers and consumers. Why is that suddenly a problem that needs regulatory action? I think this is why developers aren’t being looked on very favourably during this because they are trying to fundamentally change something that consumers like how it is, and which those same developers have benefited from massively, to try and get more of the money for themselves.
We can observe from Android that Apple’s actions did not cause this situation given the exact same situation exists in the android world where some of the remedies Apple are expected to implement are already possible on Android, yet the same ‘issues’ still exist there.
There’s clearly something else at play outside of the actions taken by Google and Apple else iOS and Android wouldn’t be in the same place.
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It’s at the expense of consumer choice in iOS land, but iOS land isn’t a market in its own right. Consumers have the choice of multiple different options in the smartphone market.
Well the EU court is the source.
Apple does not need to pay €13bn Irish tax bill, EU court rules
European commission failed to prove Apple had benefited from arrangement, court finds
And after this apple have moved to another loophole identified as leprechaun economics
And it’s not illegal to pay less than 1% tax, it’s Ireland that was on trial for illegal state aid to apple
Yes it is. That’s because apple transfer all its profits to Ireland. VAT is a consumer tax that companies collect and pay in.
This is what apple did with the double Irish tax scheme so they wouldn’t pay 12% tax(Ireland corporate tax rate) they payed less than 1% by state aid( that’s the accusation to Ireland. So apple didn’t do anything illegal. And it’s been appealed to a higher court
The case is about illegal state aid and the ability to extract profits from other places and pay taxes only once in EU
Nope. As I explained earlier, the double Irish allows them to defer payment of taxes on revenue. It doesn't allow them to avoid taxes or lower their tax rate. When they use the money, they pay taxes on it. Mostly in the US.
To be clear, the case is over and Ireland/Apple won. There was no illegal state aid. It also had nothing to do with extracting profits from other places and paying taxes only once in the EU.
Anti competitive laws.
If apple takes a x% fee. Any price bellow 10€ will be in a disadvantage if they use any 3d party solution that exist in EU as they always pay more for getting less.
So it’s very likely they will just be allowed to offer a competing service and take a fee for it.
Google be EU commission result.
Charging a licensing fee for only the store, without requiring installation of Google apps, but making it free to pre-install the Google apps if they want. Furthermore, Google's hardware partners will be allowed to market devices in the EU that run rival versions of Android or other operating systems
Google isn’t allowed to prevent provider from installing their own android version with google services or apps. Before this manufacturer wasn’t allowed to install google services on competing systems.
EU ruled it as avoiding taxes. Their effective tax rate is what’s interesting. If it’s taxed in USA is not of interest as EU sees it as it should be taxes in EU first before any other jurisdiction.
And avoiding taxes is not illegal as it’s abusing loopholes in the system. And as we have seen the effective tax rate they have is <1% by selling things to itself and shell companies.
The case isn’t over. EU commission have appealed the decision
The answer is you cant guarantee that apple will be prohibited from taking its fees and commissions…which was the point of this exchange.
Nope. Again, the effective rate that you are referencing is completely made up. It's not real. It's propaganda. It's taxes paid in Ireland divided by total European revenue. That's not how you calculate an effective tax rate.
You calculate an effective tax rate by dividing all taxes paid by profit.
Apple's effective tax rate is around 25%.
It’s very simple.
1: apple can take a listing fee.
2: payment providers are regulated in EU and just as safe as apples own system. This is not the Wilde west, not anyone can create payment system just as not anyone can start a bank.
You said apple is guaranteed to take their cut. And as I provided, it’s not anywhere near a guarantee.
I don’t need to provide a 100% guarantee as that’s not what I said. Just that it’s unlikely
Okay we will see. Just as we will see how everything unfolds. Nobody has a crystal ball. But my opinion is it’s more likely than less likely. If not, why would they want to do business in these countries, if this is where they are heading in terms of regulation. Maybe the EU should go back to blackberry I’m sure that will satisfy the regulators.
I don’t realistically think any country will be able to legally force Apple to not collect commission on use of its IP and services as that fundamentally undermines capitalist principles. Even heavily regulated industries such as telecoms and banks are permitted to make profits on their products and services.
How can apples effective tax rate be 25% when Irelands max rate is 12% andEU is on average 20%?
multinationals can pay taxes on the bulk of their revenue across the EU's 27 countries in the one EU country where they have their regional headquarters. And this is Ireland
Taxes payed in the USA isn’t relevant. Only profits made inside the EU market
IP laws already do this in EU.
APIs aren’t copyrighted in EU.
Software isn’t licensed if it’s purchased with a perpetual license and is considered as goods with a local transfer of ownership.
Apple can still earn money on its services they provide. EU are very willing to overstep rather than under step.
I totally agree that developers would try to give away free apps and then unlock the rest of the functionality with an external payment, but that's why I think the rule needs to be written in a way that if what you are unlocking is stored on Apple's servers (levels for a game, actual processing in the app, etc) Apple gets a cut. In that case, they are part of the transaction. But, if what you are paying for is a service 100% provided by the developer from their servers (think Spotify or Netflix subscription) then an outside payment can be used if already setup with that vendor. Apple literally already does this with the Amazon app.
As for the WalMart example, the physical store analogy doesn't always work. That's one way to look at it, but do you think if WalMart sells you an iPhone that they should get 30% of every purchase you make on it? Or 30% from every digital game purchased on a Playstation? That's more along the lines of how Apple's cut is working here. True, WalMart doesn't give anything away for free, but some manufacturers do sell products at a loss knowing that they'll make the money back when customers use it, like Sony with a Playstation. Maybe Apple needs to charge developers a small per download fee if they use an outside payment method, but I think that's more than made up for by the annual developer fee they all pay.