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

[Thunderhawks]

I think that regulators around the world need to grow a pair and close the loopholes these tech giants abuse and go after them when they break laws. I don’t care if these companies are the “hot girl” or if they position themselves as “innovators,” they need to be held to the same standard as everyone else.

For those who do NOT break laws, but use the loopholes smartly I don't think that will ever happen. When governments change there will always be pro and con business parties in power working on deals with ALL corporations.

So, this is not limited to just tech companies. It goes on in all industries.

Before complaining that somebody is USING loopholes, close them. The effect is usually when they close one , they rip open another after the first outcry of the local company lobbyists in their country.

It's a no win game, but looks good to talk about it. Advertising to citizens: We are doing something, these companies make too much money in our opinion and we want it , (so we can be more wasteful)

BTW: Germany has had a huge tax surplus for 3 years in a row, but is not giving it back to its citizens and corporations.

 

[Winni]

The rich pay most of the taxes

In what reality distortion field do you live in?

 

[dogslobber]

Good. I don't care of tax avoidance is legal or not - legal or not tax avoidance is loathsome and immoral.

A company's duty is to maximize shareholder value to the extent of the law. Morality is a human trait unconnected to companies. If a company board of directors fails to maximize shareholder value then they are open to being sued.

 

[Naraxus]

Good. Apple is a known tax evader and needs to pay its fair share.

 

[Plutonius]

the Government should be answerable ONLY to the people. Not enterprises that live in perpetuity that don't actually live and breath.

Agreed but it's up to the people to vote out the government if they don't have the people's interest.
[doublepost=1502142064][/doublepost]

Good. Apple is a known tax evader and needs to pay its fair share.

By the current laws, Apple is paying it's fair share and nothing more. Change the laws if you don't like what Apple is doing.

 

[fhall1]

Google is being fined 2.7 billion by the EU for comparison shopping search results (illegal) but with over 18 billion in cash it’s a small price to pay. When Facebook sought approval for their acquisition of WhatsApp they assured EU regulators it’d be “impossible to match a user’s WhatsApp account with that user’s Facebook account.” So EU regulators let the deal go through. But, Facebook soon figured out how to match those accounts and so they were fined 122 million for lying to regulators. Facebook valued WhatsApp at 19 billion so 122 million was nothing to them. They break the law because it’s cheaper to do so, so I applaud regulators who are starting to really go after these companies.

All well and good - but those examples don't have anything to do with legally exploiting the tax code.

 

[0388631]

Finding loopholes is not tax evasion.

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

Precisely. They'll go after low hanging fruit, but ignore a lot. Why? It's quite simple. If these foreign companies divest from the country and move European operations elsewhere, these 'host' countries lose out on precious tax they were already getting, plus the new tax generated by low hanging fruit. France in particular is specific about foreign companies vs. native. Even if the native choice is years behind foreign investment.

France and Germany have been at this for at least a decade now. Claiming to pass laws. The might, but they'll often look the other way. This is appeasing people in their countries, not their pockets. At the end of the day, money trumps morality, and it always will.

 

[miniyou64]

Good. I don't care of tax avoidance is legal or not - legal or not tax avoidance is loathsome and immoral.
[doublepost=1502116731][/doublepost]

How about people pay for what they want or need instead of the government stealing my money to pay for things I don't want or use?

 

[Shirasaki]

Google is being fined 2.7 billion by the EU for comparison shopping search results (illegal) but with over 18 billion in cash it’s a small price to pay. When Facebook sought approval for their acquisition of WhatsApp they assured EU regulators it’d be “impossible to match a user’s WhatsApp account with that user’s Facebook account.” So EU regulators let the deal go through. But, Facebook soon figured out how to match those accounts and so they were fined 122 million for lying to regulators. Facebook valued WhatsApp at 19 billion so 122 million was nothing to them. They break the law because it’s cheaper to do so, so I applaud regulators who are starting to really go after these companies.
[doublepost=1502123619][/doublepost]
I think that regulators around the world need to grow a pair and close the loopholes these tech giants abuse and go after them when they break laws. I don’t care if these companies are the “hot girl” or if they position themselves as “innovators,” they need to be held to the same standard as everyone else.

Maybe, if google will be fined by 27 billion, they may think twice before breaking the law.

Similarly, if Facebook will be fined by 12.2 billion by just lying to the regulators, they may choose not to do so at all.

I have a sense, that until the fine is reaching 1000 billion level, all such fines are nothing to those tech giants.

 

[hotgril]

Good. They didn't break any laws, so they don't deserve a penalty. But they're freeloading, and so is Ireland, so the loopholes should be fixed. Seems easy enough. And then I don't want to hear any more about this.
[doublepost=1502177156][/doublepost]

It's not illegal, but it is immoral. Especially because all of these tech giants love to play a 'moral high stand' game when it comes to illegal immigrants, lgbtq rights, and other social issues. But they don't have any objection of those in Qatar, Saudi Arabia, etc.

No matter how you put it - it is immoral. But not illegal.

Not if you think that the taxes are immoral. Also, if anyone is to blame, it's the people who put loopholes in the tax code. Yeah, maybe some lobbyists did something sketchy to make that happen. That would be immoral. But we don't know. At the end of the day, some politicians drafted those rules, so it's their final decision and their fault.

Separately, **** Qatar. And yes, Apple is definitely hypocritical when it comes to all their political/social stances.
[doublepost=1502177301][/doublepost]

A company's duty is to maximize shareholder value to the extent of the law. Morality is a human trait unconnected to companies. If a company board of directors fails to maximize shareholder value then they are open to being sued.

1 company = many people.
1 person still pays the minimum tax possible. 1 person also sometimes evades taxes by straight up misreporting income or something, but companies probably can't do that.

 

[verpeiler]

They have to cover their costs, mistakes, and miscalculations somehow. Especially Berlin at the moment.

If Germany has one thing at the moment, it is money. Get your facts straight. And about what miscalculations are you talking about?

 

[c0ppo]

Not if you think that the taxes are immoral. Also, if anyone is to blame, it's the people who put loopholes in the tax code. Yeah, maybe some lobbyists did something sketchy to make that happen. That would be immoral. But we don't know. At the end of the day, some politicians drafted those rules, so it's their final decision and their fault.

I have nothing against taxes. And I'm not defending any government. My own idiotic country has some of the worlds highest taxes, and we have nothing to show for it. Most of the money goes to corrupted politicians, their salaries, fancy cars, etc. And they are introducing more and more taxes every year.

But if those taxes are used as they should be used, like in say - Norway, I would gladly pay any taxes. Look at it this way, in my own country, I use anything I can get my hands on to avoid paying more and more taxes. But since I do a lot of business in Norway, I never even considered avoiding taxes. Their politicians use their taxes like it's their own money, and they use it for everyones gain. Of course, I am sure you can find some lousy apples in Norway as well, but they are so rare it's a miracle.

And I have nothing to gain when paying taxes to Norway. Nothing. I don't live there. I don't work there. I just have a company I work for on some projects, so I've opened up my own company there as well. I go there from time to time, but I never plan on leaving my own country.

So, if some small fish like me can pay their taxes in countries like Norway/UK/Germany, so can Apple

 

[iLondoner]

The low-tax loopholes have been created by Luxembourg, Netherlands and Ireland to encourage US companies to push all their European profits through their countries, so it is these three countries that are the ones who are effectively robbing Germany, France, UK and so on. The list of US companies involved includes Apple, Dell, Hewlett-Packard, Facebook, Twitter, Google, Amazon, McDonalds, Intel, Boston Scientific, Pfizer, Johnson and Johnson...

The Financial Times (British newspaper) found McDonald’s main Luxembourg operation had paid an average tax rate of just 1.49 per cent on $1.8bn of profit since 2009.

Other companies using Netherlands as a tax haven include BP, Amoco, Anglo American and Rio Tinto.

Ireland has come under international pressure over its low tax rate—over 700 US companies are officially based in Ireland, many having used 'inversion' deals in which a small Irish company mounts a takeover of a huge US corporate to allow the US company to become Irish-based.

The current European Union president Jean-Claude Juncker was the architect of the Luxembourg haven when he was prime minister, see https://www.theguardian.com/world/2014/dec/14/jean-claude-juncker-luxembourg-tax-deals-controversy
and https://www.theguardian.com/busines...blocked-eu-curbs-on-tax-avoidance-cables-show

I'm an APPL shareholder but I still want companies to pay their dues according to the amount of business they generate in each country, and if it reduces my return on investment, then so what.

 

[VulchR]

...
I am decently young myself and I think it is a good thing if a country wants to take care of its own people first. Why even have boarders or countries otherwise?

Why indeed. What has happened to the younger generation in the UK, including my two 'kids' (young adults now), is that they used to have the prospect of finding a job in an economic territory that includes more than half a billion people with trade ties all over the world. Now they can look for jobs in an economic zone of 65 million that's about to be economically disadvantaged for at least for a decade if not permanently. Currently they can travel wherever they want in the EU, study in the EU, do business in the EU, and live anywhere in the EU, but that all ends at Brexit. The network of friends and colleagues that have made across Europe is now going to be disrupted and indeed some families might be separated. Brilliant - that's really looking after the UK's young people...

I'll just note that it would have been possible to look after the people in the UK better without Brexit, but that entails ending austerity and actually investing in people (education, jobs skill training, health, housing) and infrastructure. Has that increased since Brexit? No.

@ksnell: It looks like you're from the US. Brexit is as monumentally stupid as a single state withdrawing from the US and trying to establish prosperity on its own. Even California, New York or Texas could not manage that, particularly if tariff wars arose with adjoining states, and in the same vein neither can the UK.
[doublepost=1502189950][/doublepost]

A company's duty is to maximize shareholder value to the extent of the law. Morality is a human trait unconnected to companies. If a company board of directors fails to maximize shareholder value then they are open to being sued.

Show me the law that states that shareholders' interest is paramount. Hint: it doesn't exist. Shareholders do not 'own' a company. They invest in it. If the company under-performs in the eyes of investors, they investors are free to sell their stock. The myopic pursuit of pleasing the shareholders at all cost, even to the detriment of the future of a company or the workers who are the company, is all based on an urban myth. Several serious economists are calling for the idea that stockholders are paramount to be abandoned because it is bad for business.

 

[ginkobiloba]

A company's duty is to maximize shareholder value to the extent of the law. Morality is a human trait unconnected to companies. If a company board of directors fails to maximize shareholder value then they are open to being sued.

A company is not a sentient being. It's just the name given to a human-made structure and a workflow and a collection of individuals. So yes, the concept of morality should be connected to companies, since it is nothing but a group of individuals following a set of human-made rules and workflows.

 

[VulchR]

How about people pay for what they want or need instead of the government stealing my money to pay for things I don't want or use?

Great idea. Of course, if you don't have money this doesn't work. If you resent government so much, then please leave civilisation so the rest of us don't have to hear antisocial selfish short-sighted whining. BTW - this internet you're using was invented and developed though government funded work...

 

[s2mikey]

Honestly - us people on standard W2 payrolls get nailed with taxes constantly so !@#$ Apple and Google. Pay up. Till it hurts. And shareholders are of zero concern to me. If they dont like what happens at a company then they can pull out their precious captial and go find something else to leech off of.

 

[Tapiture]

Maybe, if google will be fined by 27 billion, they may think twice before breaking the law.

Similarly, if Facebook will be fined by 12.2 billion by just lying to the regulators, they may choose not to do so at all.

I have a sense, that until the fine is reaching 1000 billion level, all such fines are nothing to those tech giants.

Well those rule violations and that lie made Google and Facebook a lot more money than it cost them when they got caught, a hell of a lot more.

 

[ksnell]

Why indeed. What has happened to the younger generation in the UK, including my two 'kids' (young adults now), is that they used to have the prospect of finding a job in an economic territory that includes more than half a billion people with trade ties all over the world. Now they can look for jobs in an economic zone of 65 million that's about to be economically disadvantaged for at least for a decade if not permanently. Currently they can travel wherever they want in the EU, study in the EU, do business in the EU, and live anywhere in the EU, but that all ends at Brexit. The network of friends and colleagues that have made across Europe is now going to be disrupted and indeed some families might be separated. Brilliant - that's really looking after the UK's young people...

I'll just note that it would have been possible to look after the people in the UK better without Brexit, but that entails ending austerity and actually investing in people (education, jobs skill training, health, housing) and infrastructure. Has that increased since Brexit? No.

@ksnell: It looks like you're from the US. Brexit is as monumentally stupid as a single state withdrawing from the US and trying to establish prosperity on its own. Even California, New York or Texas could not manage that, particularly if tariff wars arose with adjoining states, and in the same vein neither can the UK.
[doublepost=1502189950][/doublepost]

Show me the law that states that shareholders' interest is paramount. Hint: it doesn't exist. Shareholders do not 'own' a company. They invest in it. If the company under-performs in the eyes of investors, they investors are free to sell their stock. The myopic pursuit of pleasing the shareholders at all cost, even to the detriment of the future of a company or the workers who are the company, is all based on an urban myth. Several serious economists are calling for the idea that stockholders are paramount to be abandoned because it is bad for business.

1. The way you frame it makes it sound as if the EU is only good for below average countries as their citizens will be able to leave and work elsewhere, further eroding their own economy.
2. Companies will always setup shop in a locale that offers them the best environment for making money. If there are no jobs in your country, blame your government for not creating a suitable environment. You should want your government to charge just a little less tax than your next competitor, while also having suitable regulations that do not bog down the private sector.
3. Texas and California have two of the top 10 economies in the world. Not saying they should, but all they would need is their own standing army and they would be fine. Their tax remittances to the federal government go on to support other states.

 

[dampfnudel]

If Germany has one thing at the moment, it is money. Get your facts straight. And about what miscalculations are you talking about?

Money can go quickly if bad decisions are made, like bailing out a "too big to fail" auto industry that did criminal acts to make their diesel vehicles look much better than they really were, bailing out countries that will never be what Berlin wants them to be and getting more low-skilled economic migrants that are mostly incompatible with the jobs available to them, overburdening the welfare system than legitimate refugees fleeing war. My facts are coming from relatives in Germany who are experiencing this firsthand, my own personal visits and listening to German news. What Berlin is doing at the moment is looking for the extra income/revenue it will need for the coming years based on projections probably not known to the public at the moment. Apple's mountain of cash makes it a very tempting target.

 

[verpeiler]

Money can go quickly if bad decisions are made, like bailing out a "too big to fail" auto industry that did criminal acts to make their diesel vehicles look much better than they really were, bailing out countries that will never be what Berlin wants them to be and getting more low-skilled economic migrants that are mostly incompatible with the jobs available to them, overburdening the welfare system than legitimate refugees fleeing war. My facts are coming from relatives in Germany who are experiencing this firsthand and my own personal visits.

The refugees are no problem here. It's more of an administrative crisis than a demographic one.

Our "criminal" automobile industry is real problem and I hope they get more than a slap on the wrist, like in the past. But seriously, that's not a problem that concerns me personally.

And "welfare system", please.. overused and wrong bulls**** bingo word.

 

[Thunderhawks]

Money can go quickly if bad decisions are made, like bailing out a "too big to fail" auto industry that did criminal acts to make their diesel vehicles look much better than they really were, bailing out countries that will never be what Berlin wants them to be and getting more low-skilled economic migrants that are mostly incompatible with the jobs available to them, overburdening the welfare system than legitimate refugees fleeing war. My facts are coming from relatives in Germany who are experiencing this firsthand, my own personal visits and listening to German news. What Berlin is doing at the moment is looking for the extra income/revenue it will need for the coming years based on projections probably not known to the public at the moment. Apple's mountain of cash makes it a very tempting target.

For now the auto industry is promising to solve its own mess without government money, however if they are being allowed to write the cost off and thereby reducing profits, they'd pay less taxes.

In the end we know who "really" pays.

Apple is a sexy target, wondering who it would be if they were not as successful as they are. Pretty sure it will be a pretty good club.

This isn't really about Apple . It is about tax loopholes created by politicians for whatever reason and having no solution to fix them. All talk, as we will see. Tax codes everywhere in the world have become so complicated, that even the people who create them don't understand them.

So, the interpretation of what is really meant by what code creates the problems until a law suit fixes the meaning.

Imagine with all the tax codes how long a legal battle will take. The EU vs Ireland vs Apple is already going on for years.
By the time they get off the pot, the interest from the money saved will pay the puny penalties.

If it even comes to that.

 

[dampfnudel]

The refugees are no problem here. It's more of an administrative crisis than a demographic one.

Our "criminal" automobile industry is real problem and I hope they get more than a slap on the wrist, like in the past. But seriously, that's not a problem that concerns me personally.

And "welfare system", please.. overused and wrong bulls**** bingo word.

I'm not talking about refugees. We need to make a distinction there or more to the point, Berlin needs to make a clear distinction there and deal with that appropriately and fairly. A system overburdened with people who are not legitimate refugees will have negative consequences for legitimate refugees who will begin to see their decision to come to Germany as a mistake, perhaps one of the reasons a good number of Syrians are now in France trying to get to the UK, after spending a lot of downtime in crowded refugee centers in Germany. Most of them don't have family in the UK, they're just realizing Germany is overburdened and perhaps more to the point, overrated.

 

[LordVic]

Agreed but it's up to the people to vote out the government if they don't have the people'sinterest.

I agree. However this gets trickier, Because those same corporate interests that are paying for lobbying to change laws and taxation in their favour, also pay vast sums of money for media coverage in their favour. So how do you convinced a populace that has been indoctrinated to follow a certain ideological viewpoint when it's in stark contrast to their best interests.

it hurts even more when in the USA, where it's a 2 party system and neither of those parties truly reflect the majority of the country. Regardless of what the outcome was last US election, Neither of them had the overwhelming support of the country.

if you look at voter turnout, 2/3rds of the country chose not to show up to vote.

 

[Urban Joe]

Not a fan of big gvt. here but on this point I agree. Big international companies should not be doing molecular gastronmy with the tax laws. On this and other issues Apple is a total, unashamed, bold-faced, hypocritical bully. FYI: I really like Apple but they should clean up their act instead of behaving like elitist super-snobs.