Economy EU orders Ireland to make Apple to pay up to 13 billion Euros

[JohnMc]

pretty sure apple was operating under a negotiated tax plan, sounds like they are just trying to dive into apples deep pockets in an effort to bail themselves out

They are. The Irish Govt have said the Apple is Tax compliant. So the whole "Apple are Tax Evaders" thing is hollow. This is why our Ministers have told the EU to get stuffed. Its up to the Irish Govt to renegotiate with Apple if they feel like they're paying enough. This is just a shameless cashgrab on the EU's part to fund their Muslim Invasion.....I mean Refugee programme.

 

[Madmick]

The European Commission has no competence to order a Member State to pay for the amount lost tax regardles of the fact that it was Ireland which was supposed collect it, as in cases of infringement of EU law falling under competition law, the Commission only has the authority to fine the infracting companies, not Member States. Also, any unduly lost profit can only ever be collected from the beneficiary of that profit. Also, The Commission is obliging Apple to pay the amount in question TO Ireland, considering this it is unclear why the Commission would seek to have Ireland pay the lost tax to Ireland.

I think you mean they have no legal "right" according to their own bylaws. You're summarizing the central matter of dispute, here. To acknowledge this would be to simultaneously acknowledge that according to their same bylaws they also don't have the jurisdiction to retroactively levy this tax assessment. The Cayman tax-haven legally circumvented their double taxation laws; thus, the "Double Irish" loophole.
https://www.treasury.gov/resource-center/tax-policy/treaties/Documents/White-Paper-State-Aid.pdf

The schism between philosophy and law is realized by the fact that the EU would define Apple as the "beneficiary" of that "lost profit", but that is rather convenient. Ireland loses all of its tax profit if Apple doesn't reside in their borders. They aren't concerned with the EU's concern over precedent. They're concerned with brass tacks revenue. This is where sovereignty and trade unions come to an impasse. This is why trade unions will always eventually crumble; because at some point they get too big for their britches. Only sovereignty endures.

via the New York Times:
"Ireland has faced broad scrutiny for its tax appeal.

In a matter separate from the Apple case, the United States Treasury has taken aggressive steps to curtail so-called inversions, a tax move that has significantly benefited Ireland. Under those merger deals, an American company would buy an overseas counterpart and shift its headquarters overseas to lower its taxes.

Ireland, with its low corporate tax rate, has been an especially big winner with inversions. Such financial maneuvers helped plump up the country’s economy, which grew at a breakneck 26.3 percent last year."

So Instead of 14 billion they will pay 45 billions, yeah right.

Also it would work better for the EU because now all subsidiaries of Apple in the EU would be paying local corporate taxes.

You guys refuse to desist from occupying this fantasy land where theory and practice are perfectly aligned. That's not the game, here, is it?

The game is finding which country will let Apple pay the lowest effective tax. They're going to migrate to whatever country that is. If the EU wants to play hardball, maybe the US's softball approach will be more appealing. Personally, again, I think Britain is well positioned to come out the big winner.

 

[Madmick]

Pretty great piece demonstrating the EU's brazenly imperialist gesture, here:
https://www.xirrus.com/apple-is-not-the-villain-here/

Many of us read this week, with horror, the ruling of the European Union that Ireland gave illegal tax benefits to Apple worth up to €13Bn ($15Bn). Aside from the punitive nature of this ruling, there is a very dangerous precedent facing Ireland and the EU. How can it be legal for the EU to meddle in the tax affairs of a sovereign state? The EU has no jurisdiction in setting or approving tax rates within individual countries. Why, therefore, does Commissioner Margrethe Vestager have a platform to punish individual companies from her ivory tower in Brussels? It’s no surprise that many in the UK feel vindicated in their decision to vote in favor of BREXIT on June 23rd this year. Let’s look briefly at the role Ireland has played in this drama.

• Background: The European Economic Community (EEC) was established on March 25th 1957. An integral part of the EEC was the common market [a de facto merger of national markets into a single market]. Under EEC law, goods, services and labor could be moved freely and without tariffs between member states. In 1992, the Maastricht Treaty established the European Union. In 2009 the Treaty of Lisbon came into force. That year the European Community was abolished and the European Union (EU) became the single legal structure for Europe.
• Taxation within Europe – EU Tax policy is based on a belief “there is not need for an across the board harmonization of Member States’ Tax systems…. Member States are free to choose the tax systems that they consider most appropriate and according to their preferences” [Taxation & Customs Union, EU (COM(2001)260)].
• Taxation in Ireland – The corporate tax rate (CTR) in Ireland has been set at 12.5% since 2003. It should be noted there are 18 countries WW with a tax rate lower than Ireland – many of whom have a 0% tax rate. It should also be noted that the CTR in the EU varies widely, up to 33.3% in France. In Commissioner Vestager’s home country – Denmark the CTR is 23.5%, almost 10% lower than that of France. As a country with traditionally high unemployment and no natural resources, Ireland has depended on it’s highly educated and English speaking citizens, as it’s core asset. In the 70’s & 80’s Ireland was often referred to as the ‘sick man of Europe’. Unemployment in 1986 was a whopping 17%, whereas the average across Europe was half that amount. Something had to be done to get the ‘sick man’ better.
• Irish Development Authority (IDA) – The IDA was established by the Irish government in 1949 to attract and develop foreign investment in Ireland. This agency has been highly successful in attracting over 1200 companies to Ireland in Financial Services, Bio-Pharmaceutical, MedTech, Engineering and Technology sectors. 20% of all private sector jobs are directly based on foreign direct investment (FDI) companies.
• The secret sauce – The Irish government created a business-friendly tax environment, as permitted under EU law for the past 20+ years and its agency, the IDA has worked tirelessly to sell the “Emerald Isle” to companies on a global scale. The IDA setup an infrastructure which simplified the investment process into Ireland, aligning itself to multiple services agencies to ensure companies could “hit the ground running”. Executives of companies worldwide had access to politicians and public servants to ensure the process was as smooth as possible. Ireland provided manufacturing grants to international companies, allowing them to offset profits against their investment in their operations, in order to help defray costs – all within EU tax policy and within international tax rules. Ireland’s strategic position within the EU enabled international companies to declare revenue & profit in Ireland for sales to customers within the EU, in the very same way as multi-national companies do in Germany, France or the UK; but at a different tax rate. Within a generation, Ireland moved from the poorest to one of the wealthiest countries on a per capita basis, and herein lies the issue.
• The dangerous precedent – As the oft quoted British idiom goes, “this is the thin end of the wedge”. If Commissioner Vestager gets her way, Ireland will accept it’s tax policies were illegal in the past and the Apple test case opens up the flood barrier to hundreds or thousands of similar cases with other international companies in Ireland and across the EU. The result is the repayment of potentially hundreds of billions of € by international companies across the EU. This ruling has the potential to eliminate the presence of the multi-national sector and the elimination of up to 20% of Ireland’s private sector jobs. In a country where the national debt represented 93.8% of GDP last year, this would likely trigger a collapse in the economy, similar to the default of Mexico in 1994. An exodus of this magnitude would not just damage Ireland but the EU’s prosperity itself.

Given the impact of BREXIT on the UK and the EU economies, one wonders if anyone is really at the helm in the EU and whether this ruling could truly be the ‘thin end of the wedge’ for the EU itself. This is an issue which must be dealt with by the US government in close alignment with the EU. Apple is not the villain here and neither is Ireland. Both were operating strictly within local and international tax rules. One wonders why Commissioner Vestager is singling out Apple and Ireland. What’s the endgame? Instead of spending time on a drawn out legal battle, isn’t it time for us to have a set of new rules which are agreed by both the US and the EU so we can focus on the future and not the past?

Shane Buckley is the CEO of Xirrus, but he is also an Irish born American who grew up in Ireland in the 70’s. This subject is very close to his heart.

 

[PorkPiePusher]

I think you mean they have no legal "right" according to their own bylaws.

No. I mean competence. Saying that the Commission has no "right" would imply that they have the competence to do something but lack the legal justification to do it. The Commission has no competence to fine a Member State for the unduly lost profit in cases of infringement of competition law.

You're summarizing the central matter of dispute, here. To acknowledge this would be to simultaneously acknowledge that according to their same bylaws they also don't have the jurisdiction to retroactively levy this tax assessment. The Cayman tax-haven legally circumvented their double taxation laws; thus, the "Double Irish" loophole.
https://www.treasury.gov/resource-center/tax-policy/treaties/Documents/White-Paper-State-Aid.pdf

It's not a question of loophole or not, this is a question of EU Member States having the right to set whatever tax rate they like for companies operating within their borders, as long as that tax rate is such for all subjects falling in the same cathegory. Setting the tax rate for companies at X and than taxing Apple at rate Y distorts the market by way of state intervention.

The schism between philosophy and law is realized by the fact that the EU would define Apple as the "beneficiary" of that "lost profit", but that is rather convenient. Ireland loses all of its tax profit if Apple doesn't reside in their borders.

So what? I lose all profits from robbing people if I don't do it - the law still forbids me from doing it though. According to EU law, illegal state aid occurs where:
- there has been an intervention by the State or through State resources;
- the intervention gives the recipient an advantage on a selective basis;
- competition has been or may be distorted;
- the intervention is likely to affect trade between Member States.

If the Commission found that the actions of Ireland were illegal according to law that Ireland itself negotiated and accepted, then I see no problem in not letting the beneficiary of that illegal behaviour keep the profit.

You guys refuse to desist from occupying this fantasy land where theory and practice are perfectly aligned. That's not the game, here, is it? The game is finding which country will let Apple pay the lowest effective tax. They're going to migrate to whatever country that is. If the EU wants to play hardball, maybe the US's softball approach will be more appealing. Personally, again, I think Britain is well positioned to come out the big winner.

I fully agree. The game IS finding what country will let the companies operating within it pay the lowest effective tax rate, but that tax rate should not be reserved for one single company, which is what Ireland is doing. This is the opinion of the EU also, the Member States set the tax rate but then are also expected to respect and apply it and not artificially lower it in cases where state intervention and protectionism deem it necessary.

 

[Madmick]

No. I mean competence. Saying that the Commission has no "right" would imply that they have the competence to do something but lack the legal justification to do it. The Commission has no competence to fine a Member State for the unduly lost profit in cases of infringement of competition law.

This is truly semantic. Same intended denotation, different words. You're taking for granted that Vestager's legal position is the correct one, and that's precisely what is in dispute.

It's not a question of loophole or not, this is a question of EU Member States having the right to set whatever tax rate they like for companies operating within their borders, as long as that tax rate is such for all subjects falling in the same category. Setting the tax rate for companies at X and than taxing Apple at rate Y distorts the market by way of state intervention

]So what? I lose all profits from robbing people if I don't do it - the law still forbids me from doing it though. According to EU law, illegal state aid occurs where:
- there has been an intervention by the State or through State resources;
- the intervention gives the recipient an advantage on a selective basis;
- competition has been or may be distorted;
- the intervention is likely to affect trade between Member States.

If the Commission found that the actions of Ireland were illegal according to law that Ireland itself negotiated and accepted, then I see no problem in not letting the beneficiary of that illegal behaviour keep the profit.

Ireland violated none of these. That's why they're so keen to fight on Apple's behalf; because, in truth, they're fighting for every corporation who set up shop in their country. Apple took advantage of a loophole that was available to be exploited by all in Ireland. Why else do you think Ireland doesn't want to just take the $14.5bn payout? They're concerned about alienating every other corporation in their country, and yet the seat of the EU's argument is that Apple is given special treatment. I have yet to see anyone explain what "special deal" Ireland afforded Apple that wasn't available to be exploited by other companies.

I wonder what the EU hopes to accomplish with this. Do they want Ireland to reduce their corporate tax rate to 2%? That seems to be where this is headed. All of this is in dispute. What isn't in dispute is that Ireland never intended to collect more than what it collected, and the EU is telling them they're not in charge of determining for themselves how to internally manage their own tax schemes.

I fully agree. The game IS finding what country will let the companies operating within it pay the lowest effective tax rate, but that tax rate should not be reserved for one single company, which is what Ireland is doing. This is the opinion of the EU also, the Member States set the tax rate but then are also expected to respect and apply it and not artificially lower it in cases where state intervention and protectionism deem it necessary.

Is Apple the only company in all of Ireland that pays an effective tax rate below their raw corporate tax rate? Can you honestly say such a thing. Can you establish that with certainty?

Because, if you can't, then maybe you can explain to me why an American company is the one being targeted. This appears to be the only truly "selective" targeting taking place in Ireland (and the EU at large) right now.

 

[PorkPiePusher]

Ireland violated none of these. That's why they're so keen to fight on Apple's behalf; because, in truth, they're fighting for every corporation who set up shop in their country.

Nope. Only for those that they've illegaly privileged.

Apple took advantage of a loophole that was available to be exploited by all in Ireland. Why else do you think Ireland doesn't want to just take the $14.5bn payout??

Because if they take the payout they have to either lose Apple or be equally fair to all companies.

They're concerned about alienating every other corporation in their country, and yet the seat of the EU's argument is that Apple is given special treatment. I have yet to see anyone explain what "special deal" Ireland afforded Apple that wasn't available to be exploited by other companies.

Well google it then?

Is Apple the only company in all of Ireland that pays an effective tax rate below their raw corporate tax rate? Can you honestly say such a thing. Can you establish that with certainty?

Well, the state rulings that calculated the taxable part of the realised proofit were issued by Ireland directly to Apple, but no. It wasn't only in Apple's case. Ireland has possibly done this also in the case of Fiat and Starbucks. So apparently 3 companies out of all that are operating on Irish soil.

Because, if you can't, then maybe you can explain to me why an American company is the one being targeted. This appears to be the only truly "selective" targeting taking place in Ireland (and the EU at large) right now.

Well it's logical that you go after the biggest offenders firts, and the biggest offenders are those that realise thebiggest profit.

 

[Rod1]

You guys refuse to desist from occupying this fantasy land where theory and practice are perfectly aligned. That's not the game, here, is it?

The game is finding which country will let Apple pay the lowest effective tax. They're going to migrate to whatever country that is. If the EU wants to play hardball, maybe the US's softball approach will be more appealing. Personally, again, I think Britain is well positioned to come out the big winner.

1.- Law and practice is perfectly aligned pretty much in every aspect of life except when it involves corporations not being liable.

For example in the VW scenario the law states that a car shouldnt be emitting certain amount of pollutants and that directive supercedes whatever technical legaloid VW would use to comply with said law. Because it doesnt matters if VW could certify their cars "by studying for the test", the fact remains that VW didnt met the primer directive of the law which is to pollute less and even if they complied with EXISTING law, they are going to be punished.

Meanwhile if Ireland LAW says that the tax rate for corporate profits is 12.5% yes a company cheats and uses technicism and legaloid schemes to report FALSE profits and not pay a single cent in taxes, its all cool, because its perfectly fine for corporations to not be judged based on REALITY.

The fact remains that there were an insane amount of profits that were not reported by Apple which undermines the whole structure of the EU so the EU is not asking for any amount of cash, its only asking for Ireland to uphold their own laws and charge Apple the existing Irish corporate tax rate, because it doesnt matters how many schemes Apple is using, its not paying taxes on real profits.

The game is finding which country will let Apple pay the lowest effective tax. They're going to migrate to whatever country that is. If the EU wants to play hardball, maybe the US's softball approach will be more appealing. Personally, again, I think Britain is well positioned to come out the big winner.

This just shows the blatant ignorance you have on this topic, you should recuse yourself and let Arkain2k argue in favor of corporations at this point.

You can sit back and chat "U S A, U S A, U S A!!!" while your corporate overlords fuck everyone in the ass.

But since you are a mod and im sure that while you can dish out the mockery, you cant really take that back. Your point is completely stupid for the following reason.

When a company sells their wares in a foreign country, they have to pay corporate taxes for the sales there.

If Apple goes to the UK, and assuming Brexit, all the corporate sales in the EU subsidiaries will be subject to local corporate taxes and the profits being repatriated would be subject to UK tax law.

You seem to be unable to grasp that an AGREEMENT only works when EVERYONE respects the AGREEMENT.

If Ireland wants to be out of the EU expect everyone to treat Ireland like they treat other tax havens in the world.

 

[Thames]

I have followed this case before it became a headline that caught your eye. Your lack of comprehension continues to unravel. Read the sentence I wrote about "antitrust" again. Where did I indicate that "antitrust" is specific to this case? Yeah, whoops. I interpreted the drift of "antitrust", as should have been obvious, but you continue to fail to understand my refutations. Your argument is facile. You believe that the EU holds the authority to retroactively determine that set laws and agreements whose spirit were legally circumvented are now illegal (in the interest of the public good) because they didn't like getting outfoxed.

Shit. At least with the old Sherman cases you had legitimate bribes on hand. What do you have here? Creative accounting. Nothing more. Nobody got bribed. You Europeans were so happy when you took on Apple, thinking you would show us Americans how it's done, and Apple pulled your pants down in front of the world to reveal a tiny wang. Get pissed about it. I think it's hilarious.

Boom! This is where Apple was more cunning than your imbecilic authorities. Double taxation wasn't violated. Why? Because their entity in the Cayman Islands isn't obligated to pay tax to anyone. That's why they call it a "tax-free haven". Here come the EU lawyers with their pants down trying to tell everyone they had this covered-- they didn't.

Besides, if they were seeking justice, I iterate, they would have fined Ireland, and with that reprimand established a precedent where Apple would be required to pay the full tax going forward. The reason they want to take the money from the corporation, and not the violating member state, is simple: Ireland is broke. Yet, if this had been Britain, you'd be a fool to think they still wouldn't be going after the corporation, especially since it is an American one, and the wealthiest corporation in the world. We have a word for that here in the States.

Theft.

LOL, EU drone spotted. I've rarely seen you go off on multi-paragraph rants that are entirely irrelevant. Still a little sore, are we?

I'm not a stranger to the Delaware effect, dilettante. I stroked you quite masterfully with that "imperialist" adjective, didn't I? This is the word you've been conditioned since youth-- like a good little European robot-- to believe represents the great evil of our time; signaling justification for the hypocritical anti-American buffoonery that plagues your continent. How dare I violate this European safe space where they get to feel like they're the "little guy" fighting the good fight. Well, you're not little, and you're no more a force for good or anti-imperialism than Americans. To the contrary, the rift with Britain and the BREXIT established, incontrovertibly, that Europe and the EU has become the new face of authoritarian political unions.

It's simple. Apple made you look stupid.

If there was any doubt left, then the quote in bold made your ignorance on this subject very clear.

Anyway, I should note that I have been talking about overall principles here, not the technicalities related to the specific case.
It appears that you have no intention on discussing reality, and I'm not going to entertain your fantasy about this being founded in some anti-american conspiracy, and it appears like that is the only approach you can muster. I can assure you that outside of young adult internet forums, this Europe vs USA thing you base so much of your idendity on here in the WR holds little relevance, and if you think that the EU commission actually bases their actions on some kind of superiority complex related to the U.S, then I can't help you.

"You Europeans" - "Us Americans" boom boom pew pew, grow up Madmick, no one gives a shit that Apple is an american company. Welcome to the global economy.

I'll leave your education about the EU to PorkPiePusher, who is probably also more qualified than me for that job.

 

[Arkain2K]

Apple tax ruling 'must not stand' says Enda Kenny
7 September 2016

The European Commission ruling on Apple's Irish tax payments is damaging to Ireland and could not be allowed to stand, Taoiseach Enda Kenny has said.

The Dáil (parliament) is debating the European ruling that the country granted undue tax benefits of up to €13bn (£11bn) to Apple.

It was recalled early following the decision by the Irish government to appeal the ruling.

Mr Kenny, the taoiseach (prime minister), said the ruling was wrong.

"Governments over the years have made clear, as this government has, that Ireland did not and does not do deals with corporates, large or small. It is not how we do business," he told the Dáil.

"Today, this house has an opportunity to send a strong message that we stand together in challenging the presentation that the commission has made, and that we are all determined that Ireland should continue to be at the forefront in efforts to improve and reform the international tax system."

The government would appeal the ruling before the European courts with every expectation of success, added Mr Kenny.

He said that while the "Revenue commissioners will now take the steps necessary to collect the sum involved as required, it will be held in escrow pending the final outcome of the legal proceedings".

Also speaking during the debate, Irish Finance Minister Michael Noonan said Apple had not been shown favouritism.

Today's vote was always going to be a foregone conclusion once the main opposition party, Fianna Fail, indicated it would support the government motion in appealing the European Commission's Apple ruling.

It will mean that Enda Kenny's Fine Gael minority government, supported by Independents, will go to the courts in Luxembourg with the diverse support of the Irish parliament.

It will argue that it did nothing wrong and did not collude with Apple in a secret sweetheart deal, to help it avoid paying taxes in other countries.

But Sinn Féin and hard-left politicians and parties disagree and say the government should pocket the Apple money plus interest, and spend it on social services that have been reduced because of austerity.

While there is little sympathy for Apple and the low amounts of tax it has paid globally for those supporting the government, it comes down to short-term monetary gain or protecting the Republic of Ireland's good business name in the longer term.

The appeal will go ahead but it may be up to six years before we know the outcome.

"It is simply untrue that Ireland provided favourable treatment to Apple," said Mr Noonan.

"The reaction to the European Commission's decision has, at times, painted an outdated and unfair caricature of Ireland's position on tax.

"This is a caricature that is at odds with the evidence and which overlooks our proven track record in recent years.

"The facts show our constructive engagement at the international table, with matchless implementation of reforms ahead of many of our partner countries."

He said the European Commission ruling encroached on sovereign states' decisions on tax and contained contradictions on where Apple owed tax.

http://www.bbc.com/news/world-europe-37294260

 

[PEB]

EU boss is literally stumbling on feet when asked it seems like your just targeting US companies. She is having trouble giving examples of EU based companies also doing similar procedures that they are going after.

She got squeeze into dropping the possibility that Ikea may face EU's actions. But she just got back at attacking those evil US companies.

She started to talk about US companies by virtue of having superior products like social media. She accused the companies of using their dominant position to direct people to companies and services to preferred companies.

It really was an uncomfortable interview watching her struggle for answers. This is not going to end well. She also hinted more action will need to be required. In the past she talked about 120 billion needed in back taxes from Ireland. Scary talk by her.

http://www.bloomberg.com/news/artic...-greens-complaint-on-ikea-taxes-vestager-says

 

[Arkain2K]

U.S Treasury closes tax loophole for U.S. firms' offshore profits
By Ylan Q. Mui,
Sept. 15, 2016​

Apple has amassed a cash stockpile of more than $200 billion, most of it offshore, which the U.S. Treasury wants the company to repatriate.​

WASHINGTON — The Treasury Department sought Thursday to limit the benefits U.S. companies can claim when they pay taxes overseas, an effort to cushion the blow from Europe's demand that Apple pony up $14.5 billion in unpaid taxes.

In new guidance, the department tightened regulations requiring American businesses to bring foreign profits back home — a process known as repatriation — if they want to get credit for taxes paid overseas. Treasury issued the rule last year to prevent companies from enjoying a foreign tax credit when the related profits remained offshore. But businesses circumvented it by shifting money within their foreign subsidiaries, and Thursday's guidance is designed to end that practice.

The department said it hopes the new notice will reduce corporate America's incentive to “take advantage of our broken international tax system.” Washington is worried that mounting international tax obligations will eat away at what's left for Uncle Sam.

“Today, we are closing another tax loophole that contributes to the erosion of our tax base,” said Mark Mazur, assistant secretary for tax policy at Treasury.

It's the latest effort by President Obama's administration to pin down the more than $2 trillion in profits U.S. companies hold overseas. Unlike most developed countries, the United States taxes businesses on profits generated anywhere in the world, and the bill comes due once the money returns to American shores. That has encouraged many companies to keep their international profits overseas to avoid the hefty 35 percent tax rate at home.

For years, partisan gridlock has stalled attempts to encourage businesses to repatriate that income and fix the corporate tax code. Meanwhile, Apple has amassed a cash stockpile of more than $200 billion, most of it offshore. That Europe could get to it first is salt in the wound for Washington.

Treasury Secretary Jack Lew has accused European officials of targeting American companies for investigation. The European Commission ruled last month that Apple's ultra-low tax rate on its operations in Ireland ran afoul of European Union rules that prevent member countries from offering excessive incentives to businesses. Apple and Ireland dispute that decision.

“People really aren't arguing that Apple should pay more taxes,” Tim Cook, Apple's chief executive, said in an interview last month. “They're arguing about who they should be paid to.”

Apple declined to comment on the guidance issued Thursday. The company has been a flashpoint in the debate over business tax reform not only because of its name recognition but also because it is the single largest corporate taxpayer in the country. Cook has said he would be willing to repatriate overseas profits if the U.S. corporate tax rate were reduced.

European officials have investigated other big names, such as Starbucks and Amazon, for possible tax avoidance. (Amazon Chief Executive Jeffrey Bezos owns The Washington Post.)

In an op-ed in the Wall Street Journal this week, Lew decried efforts to impose what he called “unfair retroactive penalties.”

The administration has rankled business groups with its attempts to crack down on corporate tax avoidance by using its rule-writing authority in lieu of broader reform in Congress. Last month, the U.S. Chamber of Commerce and the Texas Association of Business filed a lawsuit challenging regulations aimed at deterring companies from merging with smaller, foreign firms to circumvent paying U.S. taxes, a process known as inversion. Lew welcomed reforms.

“I hope that the high level of attention following the European Commission's actions will help to lay the foundation for the new Congress to take action in the early days of a new administration,” Lew wrote in the Wall Street Journal.

https://www.washingtonpost.com/news...ompanies-operating-overseas-just-got-tighter/

 

[Dalarna3]

Is the DB fine a counterattack? Either way, shit's scary.

 

[Arkain2K]

Show Me Apple's Cash: Irish Miss Deadline as EU Stands Firm
By Peter Flanagan and Aoife White | January 18, 2018​

Why is it taking Ireland so long to collect 13 billion euros ($15.9 billion) of Apple Inc.’s money?

In August 2016, European Union Competition Commissioner Margrethe Vestager, who canceled a planned trip to Dublin on Friday due to illness, ordered the government to collect the tax arrears within five months. On Thursday in Dublin, Finance Minister Paschal Donohoe confirmed that the money won’t arrive in Dublin until at least April of this year, missing yet another deadline. The EU is suing Ireland for not collecting the money on time.

The delay may be linked in part to Ireland’s wish to negotiate an indemnity to cover itself against any losses stemming from holding the money while the commission’s decision is being appealed, as first reported by Bloomberg News. Donohoe appeared to confirm this when he told broadcaster RTE that he needs to ensure the state is protected against the risks of managing such a huge cash pile, which amounts to about a quarter of Ireland’s total annual tax take.

One way of doing that is involving Apple in the process as much as possible. The iPhone maker is involved in choosing the investment managers for the cash, and will probably have a role in monitoring the performance their performance.

Another possible wrinkle is Apple’s decision to bring hundreds of billions of overseas dollars back to the U.S. and pay about $38 billion in taxes on the money. The finance ministry says it’s acting on the assumption nothing has changed, and the Commission appears to agree.

“Tax rulings issued by Ireland had allowed Apple to pay less tax on profits recorded in Ireland than other companies subject to same national taxation laws,” the commission said.“This gave Apple an illegal advantage in breach of EU State aid rules, which must now be recovered by Ireland -- nothing has changed in that regard."

https://www.bloomberg.com/news/arti...-cash-irish-miss-deadline-as-eu-comes-to-town

 

[Arkain2K]

Apple to send $38 billion in taxes on overseas cash to the US
By Mark Scott | 1/17/18

Apple said Thursday it would pay roughly $38 billion in tax to the United States because of recent tax law changes, after repatriating cash it now holds overseas.

The move comes as American and European politicians remain divided over how U.S. tech companies — firms that have, collectively, $2 trillion stashed outside of the U.S. — should pay tax on their global operations.

That fight will likely grow as more companies follow Apple’s lead to move money held overseas back to the United States where recent tax reforms permit companies to pay a tax rate of 15.5 percent on repatriated earnings compared to the existing corporate tax rate of 35 percent, before deductions.

“We have a deep sense of responsibility to give back to our country and the people who help make our success possible,” Tim Cook, Apple’s chief executive, said in a blog post.

As part of the announcement, the iPhone maker said that it would spend an estimated $55 billion in the U.S. during 2018 on its own investments and for those targeted within its domestic supply chain.

Apple’s decision to move such a sizable amount of money back to the U.S. will raise eyebrows in many European capitals, as well as within the European Commission, which demanded in 2016 that the company repay €13 billion in back taxes to the Irish government.

Both Ireland and Apple are appealing that ruling.

https://www.politico.eu/article/apple-tax-us-united-states-38-billion-income-tax-trump/

 

[Arkain2K]

Irish PM accuses EU states of hypocrisy over corporate tax
January 17, 2018​

STRASBOURG, Jan 17 (Reuters) - Irish Prime Minister Leo Varadkar accused fellow EU states of hypocrisy over corporate tax on Wednesday and appeared to point a finger at France in particular as he rejected claims in the European Parliament that Ireland was a tax haven.

In a speech in the Strasbourg chamber where he underlined Dublin’s commitment to the European Union, Varadkar also hit back at what he called unfair accusations that Ireland was damaging its neighbours’ economies by helping multinationals like Apple Inc. channel global profits through its low-rate tax system.

Not only were countries like Hungary and Bulgaria charging companies lower rates than Ireland, he said, but France -- whose President Emmanuel Macron has been a particular critic of tax avoidance by U.S. tech giants -- offered so many loopholes for some corporations that its effective rate could also be lower.

“There’s a bit of hypocrisy about that when you look at the amount of money that we actually collect in terms of corporate taxes versus other countries that collect so much less but yet on paper have a higher tax rate and I think that needs to be challenged,” he told the parliament, which has long featured among some of the most vocal critics of corporate tax avoidance.

The EU ordered Ireland in 2016 to recover up to a record 13 billion euros ($16 billion) in back taxes from Apple and launched legal action in October over its failure to do so. .

Varadkar defended his government’s appeal to EU courts but said it would respect whatever decision the judges made and would start collecting the tax in the second quarter.

OECD data showed that France was one case where effective taxation of corporations could be lower than the 12.5-percent rate charges in Ireland, he said, adding that Dublin was also in the process of closing loopholes which have allowed some firms to pay considerably less than that headline figure.

Varadkar defended the right of smaller and peripheral states like Ireland to use taxation as part of competition to attract investment. But he added: “Corporations should pay their fair share of tax. We cannot tolerate a situation where large companies can avoid paying any taxes anywhere.”

And underlining that it was not just U.S. multinationals like Apple in Ireland that may benefit but also local firms in big European manufacturing nations, he said: “That’s as true for American tech companies as it is for European car manufacturers or for international aerospace and defence companies.”

Ireland was not in a “race to the bottom” on corporate tax, he said, arguing that in any case it was not one it could win.

Europe risked putting itself at a disadvantage to rivals such as the United States, Japan or post-Brexit Britain by working alone to close tax loopholes, Varadkar said. The European Union should, he said, seek global rules through the OECD.

“If the United States, the most successful economy in the world, can have tax competition among member states why can’t we have the same,” Varadkar said.

Ireland has found an ally in Hungary on the issue, both expressing strong opposition earlier this month to any effort to harmonise corporate and other tax rules across the European Union.

https://www.reuters.com/article/tax...of-hypocrisy-over-corporate-tax-idUSL8N1PC2HI

 

[Mark Hunts FIST]

Apple to send $38 billion in taxes on overseas cash to the US
By Mark Scott | 1/17/18

https://www.politico.eu/article/apple-tax-us-united-states-38-billion-income-tax-trump/

Does the winning ever stop folks?

 

[Arkain2K]

Apple won’t get US tax gain to match any Irish bill
Tech giant plans to make once-off $38bn tax payment to US for money it is repatriating
Thu, Jan 18, 2018

Apple is unlikely to get a write-down of its US tax bill to fully reflect any payment made to Ireland, if the European courts dismiss the appeals which the company and the Irish Government are making against the controversial European Commission decision that it owes €13 billion in back tax here.

Apple announced on Wednesday that it is to pay the US government $38 billion (€31 billion) in tax relating to money it is repatriating to the US. The payment comes on foot of new US tax legislation which is ending the ability of US companies to defer tax on cash held offshore.

Apple built up an offshore cash pile of over $250 billion from profits earned offshore over many years, the bulk of them booked through Irish subsidiaries. The EU ruled that the Irish Government offered illegal state aid to Apple in the way it allowed the company to arrange its tax affairs, and ordered that it pay the Irish Government €13 billion, plus interests and penalties.

Escrow account

Apple is due to shortly start paying money into an escrow account, overseen by the Irish Government, pending the outcome of appeals against the decision by the company and Ireland. Fund managers are likely to be appointed in the first quarter of this year to manage the money, with payments starting during the second quarter.

Normally when a company pays tax overseas, it is allowed to reduce its tax bill in its home country by receiving a credit equal to the amount paid. However, the new US tax legislation is offering a special once-off rate of 15.5 per cent for repatriated cash and offers reduced credits against the resulting tax bill for tax paid overseas. If Apple paid the full €13 billion in tax, it would, under the rules, receive a US credit of around €5.76 billion. The arrangement would also have to be approved by the US tax authorities and, as the Apple situation is unusual, some uncertainty still surrounds its likely tax treatment.

Apple thus has a financial incentive to continue the appeal against the commission’s decision, which would also involve paying interest and penalties on the tax bill.

The European Commission said that “nothing has changed” after the move to pay tax in the US.

‘Illegal advantage’

EU competition commissioner Margrethe Vestager is unhappy with the State’s delay in recouping back taxes from Apple


“Over many years, tax rulings issued by Ireland allowed Apple to pay less tax on profits recorded in Ireland than other companies,” the European Commission said in response to questions from Bloomberg.

“This gave Apple an illegal advantage.”

Ireland’s delay in extracting some €13 billion in tax from Apple has already raised the ire of EU competition commissioner Margrethe Vestager. The EU is taking the Government to court for failing to recoup the money.

Taoiseach Leo Varadkar said it will start collecting the tax bill in the second quarter of this year. Any funds will be held in escrow while the State and Apple fight the EU order in court. This is likely to take a number of years, with the case first being heard by the General Court, with the losing side then likely to appeal to the European Court of Justice. The commission found that two tax rulings made by the Revenue Commissioners offered Apple a selective advantage and this constituted illegal state aid.

https://www.irishtimes.com/business...us-tax-gain-to-match-any-irish-bill-1.3360203

 

[Arkain2K]

​

Apple still owes Ireland $16B in taxes, despite decision to bring cash back home, EU says
By Luke Stangel | Jan 19, 2018

Apple is still on the hook for $16 billion in taxes it owes the Irish government, despite the company’s decision to bring back some $245 billion in cash held overseas and pay U.S. corporate income taxes, the European Commission says.

“The Commission’s 2016 state aid decision found that, over many years, tax rulings issued by Ireland had allowed Apple to pay less tax on profits recorded in Ireland than other companies subject to (the) same national taxation laws,” a European Commission spokesman told Reuters.

“This gave Apple an illegal advantage in breach of EU state aid rules, which must now be recovered by Ireland — nothing has changed in that regard.”

For years, Apple squirreled away billions of dollars in foreign profits using a complicated accounting method involving Irish and Dutch subsidiaries. At one point, European regulators claimed Apple paid a 0.005 percent tax rate in Ireland in 2014, paying just $50 in taxes on every $1 million in taxable revenue that flowed through Ireland. Apple disputes that figure.

European regulators ordered Irish authorities to collect around $16 billion in taxes, arguing the country had offered Apple illegal state aid in the form of tax loopholes as an incentive to open its offices there. Ireland has since closed the loophole in question, but otherwise opposes the EU’s ruling.

At the time, the EU said Apple could reduce its Irish tax bill if it could prove it should have recorded its taxes in a different country than Ireland, or if its other European subsidiaries paid more taxes to the parent company, Reuters reports.

Apple’s decision to pay a 15.5 percent U.S. tax rate to repatriate its overseas cash doesn’t meet either condition, the EU said.

Cupertino-based Apple remains one of the U.S.' single largest corporate beneficiaries of the sweeping Republican tax cuts signed into law in December. The country’s corporate income tax now stands at 21 percent, rather than 35 percent. The tax code also now allows U.S. companies to bring foreign cash back into the U.S. at a 15.5 percent tax rate, rather than the previous 35 percent rate.
Apple this week announced plans to bring back the majority of its overseas cash reserves, giving the company more than $200 billion in cash on hand. The company said it planned to issue one-time bonuses to employees and invest in American companies.

Apple will likely use some of the money to pay down its corporate debt, issue shareholder dividends, buyback stock and possibly mount a major acquisition, analysts say.

https://www.bizjournals.com/sanjose/news/2018/01/19/apple-ireland-taxes-eu-repatriation-aapl.html

 

[MicroBrew]

Good. Fcuk Apple and their tax avoidance schemes.

 

[Madmick]

Apple to send $38 billion in taxes on overseas cash to the US
By Mark Scott | 1/17/18

https://www.politico.eu/article/apple-tax-us-united-states-38-billion-income-tax-trump/

We'll take back their headquarters, shortly, here, too. Enough of this astounding European hypocrisy.