Apple and Irish government collared over tax deal

[don4l]

vonuber said:

I'm amazed at the defence of the poor, picked upin corporation that is Apple.
Surprised no-one has offered to start a just giving page to help them fight the case.

Tell us something.

Do you think that Apple has brought any benefits to the people of Cork?

I'd really like to hear your answer, because I genuinely do not understand why you lefties would be happier if everybody was worse off.

Cork, like Galway, used to be a very poor area.

I take it that you wouuld be much happier if the locals lived in poverty.

You lefties are really weird. You seem to feel that the majority of people should suffer to stop anybody doing well.

[greygoose]

don4l said:

vonuber said:

I'm amazed at the defence of the poor, picked upin corporation that is Apple.
Surprised no-one has offered to start a just giving page to help them fight the case.

Tell us something.

Do you think that Apple has brought any benefits to the people of Cork?

I'd really like to hear your answer, because I genuinely do not understand why you lefties would be happier if everybody was worse off.

Cork, like Galway, used to be a very poor area.

I take it that you wouuld be much happier if the locals lived in poverty.

You lefties are really weird. You seem to feel that the majority of people should suffer to stop anybody doing well.

If Apple had paid the actual corporation tax that every other corporation had to then no doubt the whole of Ireland would have done well, instead they seem to have funnelled their EU profits through Ireland in order to pay virtually nothing.

[s2art]

greygoose said:

If Apple had paid the actual corporation tax that every other corporation had to then no doubt the whole of Ireland would have done well, instead they seem to have funnelled their EU profits through Ireland in order to pay virtually nothing.

What makes you think Apple would have been in Ireland at all if Ireland had not offered some inducements?

[turbobloke]

s2art said:

greygoose said:

If Apple had paid the actual corporation tax that every other corporation had to then no doubt the whole of Ireland would have done well, instead they seem to have funnelled their EU profits through Ireland in order to pay virtually nothing.

What makes you think Apple would have been in Ireland at all if Ireland had not offered some inducements?

Indeed. And the rest!

https://www.theguardian.com/world/2015/mar/05/irel...

[greygoose]

s2art said:

greygoose said:

If Apple had paid the actual corporation tax that every other corporation had to then no doubt the whole of Ireland would have done well, instead they seem to have funnelled their EU profits through Ireland in order to pay virtually nothing.

What makes you think Apple would have been in Ireland at all if Ireland had not offered some inducements?

I have no doubt they wouldn't have been there at all, the similarities between Cork and Silicon Valley seem to be lacking. Perhaps I am naive in thinking these big capitalist companies shouldn't rely on state assistance though.

[Jockman]

s2art said:

What makes you think Apple would have been in Ireland at all if Ireland had not offered some inducements?

I think that touches upon price elasticity. Ireland has a well-argued Corp tax rate of 6.25% which is half of its headline rate. At what point would Apple have been tempted elsewhere?

Perhaps Ireland has sold itself short?

[don4l]

greygoose said:

don4l said:

vonuber said:

I'm amazed at the defence of the poor, picked upin corporation that is Apple.
Surprised no-one has offered to start a just giving page to help them fight the case.

Tell us something.

Do you think that Apple has brought any benefits to the people of Cork?

I'd really like to hear your answer, because I genuinely do not understand why you lefties would be happier if everybody was worse off.

Cork, like Galway, used to be a very poor area.

I take it that you wouuld be much happier if the locals lived in poverty.

You lefties are really weird. You seem to feel that the majority of people should suffer to stop anybody doing well.

If Apple had paid the actual corporation tax that every other corporation had to then no doubt the whole of Ireland would have done well, instead they seem to have funnelled their EU profits through Ireland in order to pay virtually nothing.

Ireland is doing well.

Please feel free to explain how Ireand woud have done better if Apple had paid more tax?

[greygoose]

don4l said:

Ireland is doing well.

Please feel free to explain how Ireand woud have done better if Apple had paid more tax?

They could have paid off some of their debts for a start, seems relatively simple even for you.

[mike9009]

don4l said:

Ireland is doing well.

Please feel free to explain how Ireand woud have done better if Apple had paid more tax?

http://www.bbc.co.uk/news/world-europe-11855990

https://www.theguardian.com/business/2010/nov/24/i...


It may have helped here?

Edited by mike9009 on Wednesday 31st August 22:56

[turbobloke]

greygoose said:

s2art said:

greygoose said:

If Apple had paid the actual corporation tax that every other corporation had to then no doubt the whole of Ireland would have done well, instead they seem to have funnelled their EU profits through Ireland in order to pay virtually nothing.

What makes you think Apple would have been in Ireland at all if Ireland had not offered some inducements?

I have no doubt they wouldn't have been there at all, the similarities between Cork and Silicon Valley seem to be lacking. Perhaps I am naive in thinking these big capitalist companies shouldn't rely on state assistance though.

May I ask how it is you consider such relationships to involve one-way reliance, as opposed to the offering and receipt of mutual benefit?

Apple depending in some way on the Irish government doesn't stack up surely...

Irish GDP in 2015 ~ $230bn
Apple cash stash in 2015 ~ $200bn

http://www.tradingeconomics.com/ireland/gdp
http://www.cnbc.com/2015/07/21/just-how-much-cash-...

[mike9009]

turbobloke said:

May I ask how it is you consider such relationships to involve one-way reliance, as opposed to the offering and receipt of mutual benefit?

Apple depending in some way on the Irish government doesn't stack up surely...

Irish GDP in 2015 ~ $230bn
Apple cash stash in 2015 ~ $200bn

http://www.tradingeconomics.com/ireland/gdp
http://www.cnbc.com/2015/07/21/just-how-much-cash-...

Apple depends on the Irish government for preferential corporate tax rates on all EU earnings, which other EU countries cannot legally match. Simple.

[Alpinestars]

Jockman said:

I think that touches upon price elasticity. Ireland has a well-argued Corp tax rate of 6.25% which is half of its headline rate. At what point would Apple have been tempted elsewhere?

Perhaps Ireland has sold itself short?

Ireland had 2 benefits for US multinationals, outside of the low tax rate;

a) the ability to do deals - now being attacked under State Aid law, and
b) the concept of tax residence following central management and control even when a company is incorporated in Ireland. This gave rise to the double irish structure which allows profits to be stripped from Ireland to Cayman/Bermuda, where they are not taxed, unless remitted back to the US. The bifurcation of central management and control from residence is important for US tax in the whole structure.

The low tax rate attracts some investment, but in Apple's case, it's a bit of a red herring.

We should also bear in mind, Ireland has a skilled workforce and they speak (broadly) the same language as the US.

All these factors make it ideal for US organisations to route operations through Ireland.

[greygoose]

turbobloke said:

May I ask how it is you consider such relationships to involve one-way reliance, as opposed to the offering and receipt of mutual benefit?

Apple depending in some way on the Irish government doesn't stack up surely...

Irish GDP in 2015 ~ $230bn
Apple cash stash in 2015 ~ $200bn

http://www.tradingeconomics.com/ireland/gdp
http://www.cnbc.com/2015/07/21/just-how-much-cash-...

Why doesn't Apple just choose the best location for its operation and pay the tax due? I realise many on this forum see big businesses as something sacred that we should all worship and be thankful for but they have a mountain of cash, why should they have a better deal than Joe O'Bloggs the butcher et al who actually pay what is due?

[matsoc]

I don't like this retroactive decision dating back to 13 years ago. If the sum to pay was about a 1-3 years period it would be more reasonable.
Ireland made a deal with Apple, if I well understood Ireland was not in the position to make this deal without violating competition EU rules. Ok, but this had to be made clear in a reasonable time. Apple in 13 years could have moved activities from Ireland effectively not having to pay in Ireland the now requested taxes.

[matsoc]

greygoose said:

turbobloke said:

May I ask how it is you consider such relationships to involve one-way reliance, as opposed to the offering and receipt of mutual benefit?

Apple depending in some way on the Irish government doesn't stack up surely...

Irish GDP in 2015 ~ $230bn
Apple cash stash in 2015 ~ $200bn

http://www.tradingeconomics.com/ireland/gdp
http://www.cnbc.com/2015/07/21/just-how-much-cash-...

Why doesn't Apple just choose the best location for its operation and pay the tax due? I realise many on this forum see big businesses as something sacred that we should all worship and be thankful for but they have a mountain of cash, why should they have a better deal than Joe O'Bloggs the butcher et al who actually pay what is due?

Yes, I agree but if I well understand Irish government still believes that Apple paid what was due.
I am generally pro EU but this doesn't make sense. Or we go through a fiscal integration and all taxes are the same within the EU or the member states can still decide about taxation. This hybrid situation can't work.

[turbobloke]

greygoose said:

Why doesn't Apple just choose the best location for its operation and pay the tax due?

Isn't that what they did/are doing - they chose to locate in Ireland and are willing to pay the tax due.

greygoose said:

I realise many on this forum see big businesses as something sacred that we should all worship and be thankful for...

Clearly a manufactured statement. Judging by the negative comments relating to big business, including unjustified claims of reliance on state munificence, there's a mix of opinion.

greygoose said:

...but they have a mountain of cash, why should they have a better deal than Joe O'Bloggs the butcher et al who actually pay what is due?

Surely there's no claim that Apple isn't willing to 'actually pay' what's due?

Some people appear to expect payment of more than the tax due - most odd.

[mike9009]

As a high wage earner (£200k pa), I reckon I could move to Ireland, negotiate a lower VAT and income tax rate % for myself, as I will contribute more Euros in tax than a poorer Irish person on less wages.

Seems fair to me?

Mike

PS - I don't earn £200k PA......

[s2art]

I will ask again; How can Ireland force Apple to pay the tax when Apple has complied with all Irish tax law?

[twinturboz]

Worth a read.

http://www.telegraph.co.uk/business/2016/08/31/app...

[DamnKraut]

twinturboz said:

Worth a read.

http://www.telegraph.co.uk/business/2016/08/31/app...

Love that quote from your link:
"We have to see this for what it is - a highly politically-motivated targeting of a small member state along with a clear bias against US multinationals"

Yes, and this bias is there for a reason:

"The commission said the deal allowed Apple to pay a maximum tax rate of just 1%. In 2014, the tech firm paid tax at just 0.005%. The usual rate of corporation tax in Ireland is 12.5%. “Member states cannot give tax benefits to selected companies – this is illegal under EU state aid rules,” said the European competition commissioner, Margrethe Vestager, whose investigation of Apple’s complex tax dealings has taken three years."
(https://www.theguardian.com/business/2016/aug/30/apple-pay-back-taxes-eu-ruling-ireland-state-aid)

and further:

"Prof Louise Gracia of Warwick University business school said: “This ruling is a serious attempt at curtailing the power large multinationals have in avoiding their tax liabilities, and sends a warning to countries that facilitate hard-edged corporate tax minimisation strategies.” She added: “It also shines a spotlight on the paltry levels of corporate tax that large multinationals are actually paying. Even if we accept the job and wealth creation arguments put forward by multinationals as mitigation against tax liability, this has to be within reason.”"

Strongly suggest to read the article in The Guardian, it states facts - as compared to that opinionated Telegraph comment you linked.

If the Irish Government has nothing better to do than help Apple evade tax on a perverted scale and thus harm the Irish people, the Commission will intervene and help the Irish people get what is theirs: tax income in line with the Irish Tax Code and without any preferential treatment that Apple got by applying ruthlessly any tricks, loopholes in laws and regulations, pressure on politicians (who fear that loss of jobs might result from not "co-operating" with Apple) etc.

As poster Alpinestars tried to explain mutiple times, the problem is that Apple received preferential treatment as compared to other Irish and international corporations that have taxable operations in Ireland and that is what it is: veiled state aid. Arguments like "it's only state aid when it's paid directly in cash" are nonsense as the economic character/effect of that aid is relevant and not it's legal form.

I know that the hatred for the EU among UK PHers is huge, but what I don't understand is the hatred for the EU in this case where the EU is helping the Irish people get tax income that is rightfully theirs and can be used for healthcare, schools, infrastructure etc!

I am pretty sure there is a strong aversion in many of you against investment bankers acting irresponsibly and thus being one of the triggers of the 2008 economic crisis. So ... how much different in character would you think are the legions of top paid tax lawyers that Apple employs to "optimise" their tax structure on a group wide basis? I'd say not a bit.

Apple has one goal: maximise shareholder value which in itself is all fine. The way they do it - like a lot of other powerful mutinationals - by using their "bargaining" power and exploiting any weaknesses in existing laws needs to be fought by governments (who else should stop such behaviour that is harmful to society) and where they fail to do so and thus harm the principles of the European single market, the Commission needs to intervene.

I am pretty sure Apple will not leave Ireland for that reason. The Irish tax rules are still beneficial enough for them even if their effective tax rate is raised from 0.005% to 12.5% given US corporation tax rates.

And I am also sure no one here would want the UK government to offer Apple a tax rate below 0.005% just to make them relocate to the UK

So, believe it or not... the EU is doing something for the ordinary guy by fighting ruthless corporate greed.