The US threatens to destroy the greatest company it has ever created with onerous double taxation (which incidentally, even with delayed repatriation, is by far the biggest contributor to US public services). So quick, blame Brussels for enforcing a measly 10% tax on local products and services. Lol. hypocrisy has no bounds.
I agree with you but 15% of alot is still incredibly more than nothing at all. It is my understanding that this is a common practice so I'd say the US definitely needs a new tax-system.They are waiting for US tax holiday (15% or less) from Hilary or Obama -- meaning US tax payers get nothing or little either way.
You really need to read up on this a little more. "Ireland set up a tax" sure they did it was 15 percent while most of the rest of Europe is 25 percent. "If apple paid the due taxes that the sovereign nation required then I don't see how the EU can intervene?" Well except they did not. Apple pays 2 percent in Ireland because of a sweetheart deal that the EU considers to be illegal.My question is what rules in this case?
Ireland set-up a tax, a company opened there and paid such tax accordingly. Ok that the company is Apple, but the same applies to any other company. If Apple paid the due taxes that the soveirgn nation require then I don't see how that the EU can intervene and force Apple to pay a tax that does not exist.
American companies already get tax credits in the US for taxes paid abroad.I agree with you but 15% of alot is still incredibly more than nothing at all. It is my understanding that this is a common practice so I'd say the US definitely needs a new tax-system.
Brexit does not imply that companies will be allowed to completely rip off the UK.Then Apple Europe HQ moves to Brexit London for a tax break.
It is not similar. It is one and the same. The European Commission is investigating whether Apple received illegal state aid from the Republic of Ireland. If they are found to have done so, then yes the European Commission can direct the Republic of Ireland to recover the tax from Apple that it would have paid had they not been taxed according to the lower rate agreed between the Irish government and Apple.
Then Apple Europe HQ moves to Brexit London for a tax break.
You really need to read up on this a little more. "Ireland set up a tax" sure they did it was 15 percent while most of the rest of Europe is 25 percent. "If apple paid the due taxes that the sovereign nation required then I don't see how the EU can intervene?" Well except they did not. Apple pays 2 percent in Ireland because of a sweetheart deal that the EU considers to be illegal.
Most of us consider the bigger issue is that Apple sells phones all over Europe and claim the revenue in Ireland. You can perhaps compare this to if all the income from iPhone sales in the USA was booked in Bermuda and no US taxes were paid.
It always amazes me how people can defend a company paying a ~2% tax rate. Are you for real?!
The 25 percent had nothing to do with my point which was that Apple is not paying the country tax of 15 percent because of a sweetheart deal. They are actually paying 2 percent. Those types of deals are illegal.I know that I have to read more about it, that's why I am asking. Why is the EU intervening now, and not when the legislation was made? Your argument that the rest of Europe has a 25% tax is invalid for the simple reason that it doesn't matter. Tax brakes and taxation are supreme powers of the soveirgn countries; if a country can survive (and pay EU dues) with a 1% taxation, good for her.
As for your example is faulty. Bermuda is not part of the US. It's like Apple claiming revenue in CA for phones sold in TX. Guess what? That's what happens. The Feds can't force TX or CA to put higher state taxes.
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To be fair, I don't think that anyone is defending Apple per se. For all I care they can pay 99% in taxes.
In addition Guess what Ireland is not part of the France or Germany or the UK. It is no difference than Bermuda is to the USA.
The EU avoids the sovereign taxation limitations by using their other regulatory powers concerning State Aid......Tax brakes and taxation are supreme powers of the soveirgn countries; if a country can survive (and pay EU dues) with a 1% taxation, good for her.....
The EU avoids the sovereign taxation limitations by using their other regulatory powers concerning State Aid.
DG Competition Working Paper On State Aid And Tax Rulings
A cursory read of the Consolidated version of the Treaty on the Functioning of the European Union will likely reveal to you how much power can be garnered, including taxation by any other name, through its non-specific, abstract language.
I haven't, as of yet, read anything regarding a statute of limitation on the EU in regard to their State Aid powers.
They do businesses in the US, their tax dollars need to all go to the US, too.The US might be on the losing end of that, Honda Toyota Samsung etc.
If as you say it is determined that Ireland passed a tax law in violation of EU rules then why doesn't Ireland pay the penalty.
I am seriously trying to understand what powers does the EU have.
Maybe if the United States modernised its tax rules, perhaps we wouldn't be having this conversation. The reason many companies do not repatriate their cash back into the United States is because of the ridiculously high corporate tax rate. Would you accept a 35% cut to bring your income back home? No, you might opt to keep your money at a bank overseas.
It always amazes me how people can defend a company paying a ~2% tax rate. Are you for real?! And no, just because you would do the same if you could still doesn't make it ok. I doubt we have the billionaires posting on MR so you guys maybe need to step back a notch and rethink your position..just saying.
I agree with you but 15% of alot is still incredibly more than nothing at all. It is my understanding that this is a common practice so I'd say the US definitely needs a new tax-system.
Unless you paid 0% taxes overseas, the rate is never going to be 35%. Repatriating money to the U.S. allows you to deduct the rate that you already paid overseas. So if you paid 20% in a foreign country, then it would be an additional 15% to repatriate. You're credited for the money you already paid. Apple is complaining about this because Ireland didn't really expect them to pay much of anything to begin with.
Dear EU,
This is how we deal with it.
Love,
The U.K. #Brexit
Dear UK,
This is how one commits an economic own-goal (see WSJ article).
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Thank you for paying more for our exported goods, services, electricity and food that we send to the UK. Really. We love it.
Love,
the EU
The value of the pound will no doubt begin to stabilise to pre-referendum levels when the post-EU relationship becomes clear after the details are finalised between the UK and other EU governments. You should know there are businesses in the UK that have benefited from the pound's falling value.
I realise, but the point is you are losing a total of 35% by repatriating money to the United States, which is the world's largest economy, and yet has the third highest corporate tax rate in the world.
I agree that the US corporate tax is too high, but I think Apple would have pulled every stops to avoid paying anything higher than 2%. Also, What tax rates would you consider "fair" for a company that has in the past received gov't protection against foreign competitors (eg, Obama's reversal of Apple iPhone import ban)?
Well most countries around the world have lower corporation tax rates than the United States. Of course most big corporations will do everything legally possible to reduce their tax burden as much as possible; Apple is no exception. It requires a concerted effort by lots of countries working together to legislate real tax reform, but there are too many competing interests and too many big corporations lobbying their own selfish interests to make that possible.
A veto on an import ban from the International Trade Commission can easily be appealed and I remember quite clearly attached to the veto letter was an acknowledgement that Samsung has the right to appeal the decision in Court, which I am sure they would have done. I can understand how it might be seen as protectionism but I think the United States does a far better job at staying fair against foreign companies in contrast with a country like China which repeatedly attacks foreign firms that become successful and start to threaten the monopolies or success of Chinese companies, or companies with affiliations to the Chinese government. Of course this is nothing new that we don't already know. I'm not suggesting the US has never put domestic companies' interests first, but they are certainly not aggressive against foreign investment and competition like China is.
Then make Ireland pay up the difference (or a fine and punish them somehow) - not Apple or other companies that used Ireland as a go-between.
A tax adjustment would be payable to Ireland, not directly to the EU. The EU would probably receive slightly more from Ireland due to this, but it wouldn't be that significant.