France and Germany Prepare Crackdown on Tax Loopholes With Tech Companies Like Apple in Sights

[MacRumors]

France and Germany are looking to stop tech companies like Apple from exploiting tax loopholes in their respective countries. The loopholes are said to have allowed Apple to "minimize taxes and grab market share" at the expense of Europe-based companies.

France will draft and propose a list of "simpler rules" that will be aimed at creating a "real taxation" law for non-European companies, which also include Amazon and Facebook (via Bloomberg).

The new rules will be looked at in September during a meeting of European Union officials, which French finance minister Bruno Le Maire hopes will help speed up Europe-wide initiatives related to properly taxing international companies. Germany is said to be looking into similar proposals following its national election on September 24.

French President Emmanuel Macron is one of the leaders behind the tax crackdown on international tech companies, with a goal of bringing a more unified corporate tax system across the nineteen euro area states.

The clampdown on tech firms is part of President Emmanuel Macron's muscular approach to ensuring a level playing field, after seeing first hand during his election campaign how French firms struggle to compete with countries where taxes and social security payments are lower.

"Europe must learn to defend its economic interest much more firmly -- China does it, the U.S. does it," French Finance Minister Bruno Le Maire said. "You cannot take the benefit of doing business in France or in Europe without paying the taxes that other companies -- French or European companies -- are paying."

In similar news, last year the European Commission ruled that Apple received illegal state aid from Ireland and ordered the company to pay $14.5 billion in back taxes. Apple admitted that it expects the case to continue for several years, and eventually appealed the decision in December of 2016 by arguing the European Commission made "fundamental errors" in its ruling.

If the new crackdown on tax loopholes goes into effect, Apple could potentially face more tax avoidance charges, which company CEO Tim Cook called "total political crap" in the wake of the Ireland-related ruling. In an open letter around the same time, Cook said that Apple has become "the largest taxpayer in the world," stating that the company "follows the law and we pay all the taxes we owe." He called the European Commission's ruling an "effort to rewrite Apple's history in Europe," and said that any claim that Ireland gave Apple a "special deal" on taxes "has no basis in fact or in law."

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: France and Germany Prepare Crackdown on Tax Loopholes With Tech Companies Like Apple in Sights

 

[Plutonius]

Finding loopholes is not tax evasion.

All as the countries have to do is change their tax laws to eliminate loopholes.

 

[Shirasaki]

Bet they lack money so want some extra cash from Apple .

 

[Mtmspa]

What European country has developed tech products that have been by Apple?

This is a money grab and those two countries should worry about their policies that have led to terrorism.

 

[VulchR]

Good. I don't care of tax avoidance is legal or not - legal or not tax avoidance is loathsome and immoral. What I do care about is that the rich and the corporations seem to wiggle out of a reasonable effective tax rate while public services are being stretched to the limit. It's time for them to pay their fair share, for otherwise the economy and indeed our culture will not be sustainable.
[doublepost=1502116731][/doublepost]

What European country has developed tech products that have been by Apple?

This is a money grab and those two countries should worry about their policies that have led to terrorism.

really? What does tax evasion/avoidance have to do with terrorism other than it creates a way for terrorists to hide their money in offshore tax havens?

 

[Wackery]

Countries: we need more jobs!

makes business more and more difficult and expensive

Countries: why don't you move here to create jobs!

 

[Gutwrench]

Another Pulitzer Prize winning title.

If a country doesn't like their tax regulations then change them. Companies will just adjust in search of the most advantageous environment. Nature does it, businesses do it, people do it.

 

[duffman9000]

Finding loopholes is not tax evasion.

All as the countries have to do is change their tax laws to eliminate loopholes.

Yup. Don't like the law? Change the law.

 

[576316]

Yeah like companies paying tax in the countries the product was sold in, not siphoning profits through a lower tax country. Like how Apple bill all sales through Ireland for less tax - they shouldn’t be able to do that. English sale = English tax on that sale.

 

[Avieshek]

France will draft and propose a list of "simpler rules"

This what should follow in India too. 'Simpler Rules'

 

[edk99]

Good. I don't care of tax avoidance is legal or not - legal or not tax avoidance is loathsome and immoral. What I do care about is that the rich and the corporations seem to wiggle out of a reasonable effective tax rate while public services are being stretched to the limit. It's time for them to pay their fair share, for otherwise the economy and indeed our culture will not be sustainable.

Following tax rules (loopholes or tax avoidance) is not immoral. These companies have teams of tax lawyers that comb through these tax rules to make sure they pay not one cent more or less then they have to. There is NOTHING immoral or loathsome about that. Immoral would be me screwing my sister. That is immoral.

I have no problem if these countries want to change tax rules but blame should be placed on these governments that designed the tax rules in the first place and not the companies that follow them. If these companies are evading taxes then by all means prosecute them. Other then last years EU commission flawed, vague ruling that took them 3 years to come up with against Apple which most likely won't hold water in court, these governments have failed to prove any tax evasion.

 

[WRChris]

Good. I don't care of tax avoidance is legal or not - legal or not tax avoidance is loathsome and immoral. What I do care about is that the rich and the corporations seem to wiggle out of a reasonable effective tax rate while public services are being stretched to the limit. It's time for them to pay their fair share, for otherwise the economy and indeed our culture will not be sustainable.
[doublepost=1502116731][/doublepost]


really? What does tax evasion/avoidance have to do with terrorism other than it creates a way for terrorists to hide their money in offshore tax havens?

Reality check: our way of living isn't sustainable.

The rich have no more obligation to pay in then we do. We all should pay equal if we are forced to pay at all.

I question the legality of forcing people to pay just to live in a country where every government service is broken or favors one segment of the population over the other.

It's effectively a form of slavery. I think the governments of the world should sustain themselves not operate on the backs of citizens who do not even want them in the first place.

 

[IbisDoc]

Gotta love it when flaming liberals use loopholes to avoid paying taxes.

 

[Skika]

Good. I don't care of tax avoidance is legal or not - legal or not tax avoidance is loathsome and immoral. What I do care about is that the rich and the corporations seem to wiggle out of a reasonable effective tax rate while public services are being stretched to the limit. It's time for them to pay their fair share, for otherwise the economy and indeed our culture will not be sustainable.
[doublepost=1502116731][/doublepost]


really? What does tax evasion/avoidance have to do with terrorism other than it creates a way for terrorists to hide their money in offshore tax havens?

The rich pay most of the taxes

 

[H2SO4]

About goddam time!!

Tho something tells me that this lion will have no teeth.

 

[VulchR]

Following tax rules (loopholes or tax avoidance) is not immoral. These companies have teams of tax lawyers that comb through these tax rules to make sure they pay not one cent more or less then they have to. There is NOTHING immoral or loathsome about that. Immoral would be me screwing my sister. That is immoral.

I have no problem if these countries want to change tax rules but blame should be placed on these governments that designed the tax rules in the first place and not the companies that follow them. If these companies are evading taxes then by all means prosecute them. Other then last years EU commission flawed, vague ruling that took them 3 years to come up with against Apple which most likely won't hold water in court, these governments have failed to prove any tax evasion.

No need to bring your sister into this...

It is immoral to use the infrastructure and public services of a country but not contribute to their upkeep. Moreover, not only is it immoral but it is unsustainable.
[doublepost=1502120039][/doublepost]

The rich pay most of the taxes

Yes, they do. However, the portion of taxes they pay is not commensurate with the proportion of wealth that they own.

 

[autrefois]

Bet they lack money so want some extra cash from Apple .

Yes, they lack money...because companies are taking advantage of loopholes. I didn't see anyone claiming it was evasion or illegal, so it would be good to avoid straw men and debate whether or not governments, who represent the people, should make companies pay more taxes or not. I happen to think they should. The gap between rich and poor is skyrocketing in Europe and the US. Despite most countries slashing social programs, governments have less money for the basics that society needs. This would be one way of addressing the situation.

 

[oneshotpro]

After flooding their countries with Muslim refugees who do nothing but take advantage of government handouts, they are now looking to increase taxes to pay for it.

 

[macfacts]

What European country has developed tech products that have been by Apple?

This is a money grab and those two countries should worry about their policies that have led to terrorism.

Those countries are trying to close some loopholes used by a very few companies, mainly multinational tech companies. What makes it a money grab? They aren't targeting Apple, only companies that use some loopholes. What is wrong with that?

 

[Tapiture]

I’ll be cheering from the sidelines. It’s ridiculous how this huge tech companies like Apple and Google are somehow above the law. In order for an economy to thrive, a quarter of corporate profits have to be handed over, and these tech giants are paying way less than everyone else.

 

[macfacts]

Yup. Don't like the law? Change the law.

That's what is happening in this story. Law is going to be changed. So why are there some mad people in this thread? Should laws never change? Should slavery still be legal?

 

[Zombie Acorn]

Don't see a problem as long as they don't try to make it retroactive.

 

[VulchR]

Reality check: our way of living isn't sustainable.

The rich have no more obligation to pay in then we do. We all should pay equal if we are forced to pay at all.

I question the legality of forcing people to pay just to live in a country where every government service is broken or favors one segment of the population over the other.

It's effectively a form of slavery. I think the governments of the world should sustain themselves not operate on the backs of citizens who do not even want them in the first place.

I agree with you: our current system is not sustainable. At some point the dumb selfish rich idiots controlling things will make wealth inequality so onerous that there will be massive civil unrest that brings everybody down. The first thing people do when they conclude a system will never work for them is dismantle it, one way or the other. I prefer that we have progressive taxation than violent unrest.

(Image source: link)

There were large scale riots in the UK in 2011 (see above). When the next economic downturn comes, as it must, there is nothing left in the public sector to help people through it. Imagine how dangerous that will be.

 

[fhall1]

I’ll be cheering from the sidelines. It’s ridiculous how this huge tech companies like Apple and Google are somehow above the law. In order for an economy to thrive, a quarter of corporate profits have to be handed over, and these tech giants are paying way less than everyone else.

How are they "above the law"? They have done nothing illegal by exploiting tax loopholes. Any company with tax lawyers/accountants worth their salt would do the same thing.

 

[Shirasaki]

Yes, they lack money...because companies are taking advantage of loopholes. I didn't see anyone claiming it was evasion or illegal, so it would be good to avoid straw men and debate whether or not governments, who represent the people, should make companies pay more taxes or not. I happen to think they should. The gap between rich and poor is skyrocketing in Europe and the US. Despite most countries slashing social programs, governments have less money for the basics that society needs. This would be one way of addressing the situation.

Then I wonder: if, which is a huge if, the law regulating corporation tax does not have too much loopholes from the start, corporation tax should be enough for government to feed off their need. Assume Apple pays $10 billion taxes to US each year, the situation could be much better overall.