Claire. Posted August 31, 2016 #1 Share Posted August 31, 2016 (edited) EU hits Apple with $14.5 billion Irish tax demand. The European Commission ordered Apple Inc to pay Ireland unpaid taxes of up to 13 billion euros ($14.5 billion) on Tuesday as it ruled the firm had received illegal state aid. Apple and Dublin said the U.S. company's tax treatment was in line with Irish and European Union law and they would appeal the ruling, which is part of a drive against what the EU says are sweetheart tax deals that usually smaller states in the bloc offer multinational companies to lure jobs and investment. The U.S. feels its firms are being targeted by the EU and a U.S. Treasury spokesperson warned the move threatens to undermine U.S. investment in Europe and "the important spirit of economic partnership between the U.S. and the EU." Read more: Reuters Edited August 31, 2016 by Waspie_Dwarf corrected title at request of OP. 1 Link to comment Share on other sites More sharing options...
Leonardo Posted August 31, 2016 #2 Share Posted August 31, 2016 From the article you posted, Clair... EU Competition Commissioner Margrethe Vestager questioned how anyone might think an arrangement that allowed Apple to pay a tax rate of 0.005 percent, as Apple's main Irish unit did in 2014, was fair. Well, at least we have a better understanding of how Apple were able to build up their $200 billion cash reserves. 3 Link to comment Share on other sites More sharing options...
itsnotoutthere Posted August 31, 2016 #3 Share Posted August 31, 2016 According the the paper this morning, it equates to £50 tax for every £1,000,000 profit. Unbelievable. Wonder if the tax man would do me the same deal. 3 Link to comment Share on other sites More sharing options...
stevewinn Posted August 31, 2016 #4 Share Posted August 31, 2016 Before we lose sight in the cloud of smoke - what we need to remember, for get the moral of how much Apple was paying in tax. - the seriousness is this, this was an agreement between Apple and the Irish Government in return for investment and Jobs. Then the EU decides to poke its nose in Ireland's affairs which don't concern it. Its no surprise the new EU budget is being worked out, The EU is not soft, They are saying Apple owes not the EU but the Irish government €13 billion but the EU know if Apple do pay up - they the EU will then get a share via increasing Ireland's EU contributions based on the increase. - It says it all when the Irish government is appealing the decisions and their the ones set to gain the billions. so why don't they want it? ask that question 5 Link to comment Share on other sites More sharing options...
Leonardo Posted August 31, 2016 #5 Share Posted August 31, 2016 29 minutes ago, stevewinn said: Before we lose sight in the cloud of smoke - what we need to remember, for get the moral of how much Apple was paying in tax. - the seriousness is this, this was an agreement between Apple and the Irish Government in return for investment and Jobs. Then the EU decides to poke its nose in Ireland's affairs which don't concern it. Its no surprise the new EU budget is being worked out, The EU is not soft, They are saying Apple owes not the EU but the Irish government €13 billion but the EU know if Apple do pay up - they the EU will then get a share via increasing Ireland's EU contributions based on the increase. - It says it all when the Irish government is appealing the decisions and their the ones set to gain the billions. so why don't they want it? ask that question Yeah - except for the EU law that Ireland agreed to, which states no government can offer unequal tax incentives which are equivalent to subsidisation of a private business - also illegal under EU law. You know, except for the fact Ireland's govt broke those EU laws, the EU had no right to poke their nose in. 2 Link to comment Share on other sites More sharing options...
stevewinn Posted August 31, 2016 #6 Share Posted August 31, 2016 (edited) 1 hour ago, Leonardo said: Yeah - except for the EU law that Ireland agreed to, which states no government can offer unequal tax incentives which are equivalent to subsidisation of a private business - also illegal under EU law. You know, except for the fact Ireland's govt broke those EU laws, the EU had no right to poke their nose in. I cant argue with you over the detail because i simply cant find a source with enough detail. but working on the reports via BBC etc.. what i will say. - The Irish Government deny those allegations along with Apple and both are appealing the EU's judgement. - I cannot see how the Irish have broken the rules when the EU does not set Irish tax policy. and if that's the case then the EU have no right to stick their noses in. Its going to be interesting as more details emerge. Apple: state they have invested over a Billion Euro's in Ireland and employ 6,000 with a further 18,000 in the supply chain. What the EU is effectively proposing is to replace Irish tax laws with a view of what the Commission thinks the law should have been. The implications of this outcome are immense. Apple itself in their press release stated. Quote The European Commission has launched an effort to rewrite Apple’s history in Europe, ignore Ireland’s tax laws and upend the international tax system in the process. The opinion issued on August 30th alleges that Ireland gave Apple a special deal on our taxes. This claim has no basis in fact or in law. We never asked for, nor did we receive, any special deals. We now find ourselves in the unusual position of being ordered to retroactively pay additional taxes to a government that says we don’t owe them any more than we’ve already paid. The Commission’s move is unprecedented and it has serious, wide-reaching implications. It is effectively proposing to replace Irish tax laws with a view of what the Commission thinks the law should have been. This would strike a devastating blow to the sovereignty of EU member states over their own tax matters, and to the principle of certainty of law in Europe. Ireland has said they plan to appeal the Commission’s ruling and Apple will do the same. We are confident that the Commission’s order will be reversed. Interesting times ahead especially for the Multi-nationals in places such as Dublin and Luxembourg. Apple today whose next? anyone whose American owned?. All comes fresh on the heels of the failed US & EU trade deal that after 3 years has collapsing according to the German minister. is there a connection? i'll let others decide. Edited August 31, 2016 by stevewinn 1 Link to comment Share on other sites More sharing options...
bmk1245 Posted August 31, 2016 #7 Share Posted August 31, 2016 Apple will just move elsewhere, and several thousand workers will have to find work elsewhere 4 Link to comment Share on other sites More sharing options...
Claire. Posted September 1, 2016 Author #8 Share Posted September 1, 2016 Ohh, our tax code allows for a one heck of a retaliation against Europe. U.S. tax law gives the Obama administration power to double tax rates for European companies should it choose to dramatically escalate a dispute with the European Union over Apple's tax bill. Experts said the administration was unlikely to take such a drastic measure, and even if it did, courts might strike down that action because of treaties.Section 891 of the U.S. tax code, passed in 1934 but never used, allows the president to double tax rates for citizens and corporations of any country the administration considered was discriminating against U.S. companies. Source: Reuters 1 Link to comment Share on other sites More sharing options...
stevewinn Posted September 1, 2016 #9 Share Posted September 1, 2016 16 hours ago, Clair said: Ohh, our tax code allows for a one heck of a retaliation against Europe. get the Philadelphia lawyers on the case. Link to comment Share on other sites More sharing options...
Claire. Posted September 2, 2016 Author #10 Share Posted September 2, 2016 UPDATE: Ireland to join Apple in fight against EU tax ruling. Ireland's cabinet agreed on Friday to join Apple in appealing against a multi-billion-euro back tax demand that the European Commission has imposed on the iPhone maker, despite misgivings among independents who back the fragile coalition. The Commission's ruling this week that the U.S. tech giant must pay up to 13 billion euros ($14.5 billion) to Dublin has angered Washington, which accuses the EU of trying to grab tax revenue that should go to the U.S. government. Read more: Reuters 3 Link to comment Share on other sites More sharing options...
Dark_Grey Posted September 2, 2016 #11 Share Posted September 2, 2016 That Brexit couldn't have happened soon enough. The EU once again dipping into honey jars that don't belong to them. 3 Link to comment Share on other sites More sharing options...
Leonardo Posted September 2, 2016 #12 Share Posted September 2, 2016 1 hour ago, Dark_Grey said: That Brexit couldn't have happened soon enough. The EU once again dipping into honey jars that don't belong to them. How do you know that? The relevant EU law, which has been in place long before Apple set up it's operation in Ireland, prohibits any government from offering tax incentives to private companies that would be equivalent to subsidisation. But that is what Ireland offered Apple to set up it's operation in that country. If the US had such a law in it's federal statutes, the US govt would act exactly as the EU has done if a company in the US was given such favourable conditions by a State government. The EU law was put in place to ensure all member states had equal opportunity to attract business. The "honey jar" as you put it, belongs to the Irish govt not "the EU", but it is the EU which enforces the "federal" laws and is telling Apple to pay what it should have paid to the Irish govt. That being corporation tax at the rate of 12.5% which is what the Irish govt has set for it's corporate tax rate for all businesses in it's territory. The extra cash Apple did not pay in tax was never the US Federal authority's to claim. 1 Link to comment Share on other sites More sharing options...
Unusual Tournament Posted September 3, 2016 #13 Share Posted September 3, 2016 8 hours ago, Dark_Grey said: That Brexit couldn't have happened soon enough. The EU once again dipping into honey jars that don't belong to them. I don't think that Apple paying 0.005% tax rate is fair. Link to comment Share on other sites More sharing options...
Unusual Tournament Posted September 3, 2016 #14 Share Posted September 3, 2016 ...besides, the less tax that Apple or any other corporation pays means that the average Joe has to pay more. 2 Link to comment Share on other sites More sharing options...
stevewinn Posted September 3, 2016 #15 Share Posted September 3, 2016 (edited) 14 hours ago, Dark_Grey said: That Brexit couldn't have happened soon enough. The EU once again dipping into honey jars that don't belong to them. They are going after US companies, what's funny when EU's President was the mere Prime Minister of Luxembourg he set up Luxembourg to increase its status as a tax haven within the EU. - Why aren't companies in Junkcers Luxembourg being chased up? maybe they are next on the hit list, Google, Amazon, Microsoft etc... but its clear Dublin is the test case. But you are correct it proves Brexit was the correct decision to Leave, since we've voted to Leave, in less than 2 months we've had talk of a EU army, (they said it would never happen) The EU is set to increase membership contributions - its one of the reasons they are going after Apple in Ireland, boost the Irish coffers by $13billion = increase Irish EU contributions. - But make no mistake about it this is a precursor to a EU tax harmonisation. more fool anyone who thinks its about tackling tax avoidance. just a sample of the Headlines appearing, Business times "Attack on Apple test of EU-US relations" Washington Post, "How the E.U.’s ruling on Apple explains why Brexit happened" Bloomberg, "EU's attack on Apple boon for UK post Brexit" Financial Times "EU Apple Tax shows wisdom of Brexit" Wall street journal "Brexit makes UK more attractive to multinationals after EU take a bite out of Apple" Well all good, - i say go on EU take on Apple and other US multinationals, The move by the EU has certainly raised a few eyebrows, not just them domiciled in Europe but around the world it highlights one of the points i made in the Brexit thread. about British Law in regard to companies compared to the EU. over here this case would have been through the courts, But in the EU the unelected EU Commission decided this case. no court ruling, nothing. well played European Union proving once again you are a disaster case. and apparently this is the same institution which the Remainers said will see London's Financial centre move to the continent. yeah right. - This proves to the USA, who's recent trade negotiations with the EU collapsed after 3 years, and now the attack on US multinationals, that the financial, investment and trade links across the globe will run through the United Kingdom. Irexit? on the Horizon. one can only hope. Ireland flanked by USA - Ireland - UK. 12 hours ago, Leonardo said: How do you know that? The relevant EU law, which has been in place long before Apple set up it's operation in Ireland, prohibits any government from offering tax incentives to private companies that would be equivalent to subsidisation. But that is what Ireland offered Apple to set up it's operation in that country. If the US had such a law in it's federal statutes, the US govt would act exactly as the EU has done if a company in the US was given such favourable conditions by a State government. The EU law was put in place to ensure all member states had equal opportunity to attract business. The "honey jar" as you put it, belongs to the Irish govt not "the EU", but it is the EU which enforces the "federal" laws and is telling Apple to pay what it should have paid to the Irish govt. That being corporation tax at the rate of 12.5% which is what the Irish govt has set for it's corporate tax rate for all businesses in it's territory. The extra cash Apple did not pay in tax was never the US Federal authority's to claim. I think we better wait for the outcome of this case before we keep peddling the line of the EU Commission. after all it wasn't a court of Law who made this judgement, it was in fact the Unelected European Commission who has concluded they broke EU rules. Now the Irish Government are in the position to receive this $13Billion windfall from Apple, Yet the Irish government says it doesn't want the money because they the Irish Government say Apple doesn't owe them the Money. Its a peculiar situation we have here. Now Apple and the Irish Government just yesterday have decided to take this matter to Irish Courts, EU courts and possibly international, as in the US. Apple statement. Quote The European Commission has launched an effort to rewrite Apple’s history in Europe, ignore Ireland’s tax laws and upend the international tax system in the process. The opinion issued on August 30th alleges that Ireland gave Apple a special deal on our taxes. This claim has no basis in fact or in law. We never asked for, nor did we receive, any special deals. We now find ourselves in the unusual position of being ordered to retroactively pay additional taxes to a government that says we don't owe them any more than we've already paid. The Commission’s move is unprecedented and it has serious, wide-reaching implications. It is effectively proposing to replace Irish tax laws with a view of what the Commission thinks the law should have been. This would strike a devastating blow to the sovereignty of EU member states over their own tax matters, and to the principle of certainty of law in Europe. Ireland has said they plan to appeal the Commission’s ruling and Apple will do the same. We are confident that the Commission’s order will be reversed Irish Government response (Friday) Quote Minister for Finance Michael Noonan stated that the EU Commission's ruling over Apple's tax operations in Ireland is an attack Irelands corporate tax regime. The finance minister said the current ruling represented a bridgehead for those who wanted to attack our corporate tax system but he warned that we were going to stick with our 12.5%. No challenge by any commissioner would be tolerated he said, insisting that Ireland would fight the issue at home and abroad and in the courts. In a statement, Mr Noonan said: "Ireland did not give favourable tax treatment to Apple. Ireland does not do deals with taxpayers". The terms of the appeal will now be drafted by the Attorney General, and the Dáil will meet to debate the issue next Wednesday. The motion also stated that the Government should appeal the Apple ruling on the grounds of defending the integrity of the tax system, provide tax certainty to businesses and to challenge the encroachment of EU state aid rules into the sovereign member states competence to set its taxation. Edited September 3, 2016 by stevewinn 3 Link to comment Share on other sites More sharing options...
Black Monk Posted September 3, 2016 #16 Share Posted September 3, 2016 (edited) Behind the shadow boxing is a strong suspicion that powerful forces in the EU are trying to use state aid probes to break the global dominance of America's technology giants, vainly hoping to nurture its own 'Silicon Valley' behind a digital wall. Amazon, Facebook, Google, as well as Apple, are all under fire, and Microsoft has fought an epic battle. The view in Washington is that Mrs Vestager's probe of the Russian gas giant Gazprom is being conducted with kid gloves, and that she is strangely accommodating over the Nord Stream pipeline so favoured by Germany. It is almost as if some in Brussels view America as the real enemy. The US has in the past played down the episodic outbursts of anti-Americanism, but patience is wearing thin and the strategic calculus is shifting. Donald Trump has already warned that he is willing to "walk away" from NATO altogether. Others question ever more loudly exactly why the US should continue to guarantee the EU's eastern border against Vladimir Putin's Russia if Brussels is behaving in such an unfriendly fashion - and without the American security blanket a disarmed Europe is almost completely defenceless. The EU needs to watch its step. http://www.telegraph.co.uk/business/2016/08/31/apple-travesty-is-a-reminder-why-britain-must-leave-the-lawless// Edited September 3, 2016 by Black Monk 4 Link to comment Share on other sites More sharing options...
Leonardo Posted September 3, 2016 #17 Share Posted September 3, 2016 15 minutes ago, Black Monk said: Behind the shadow boxing is a strong suspicion that powerful forces in the EU are trying to use state aid probes to break the global dominance of America's technology giants, vainly hoping to nurture its own 'Silicon Valley' behind a digital wall. Amazon, Facebook, Google, as well as Apple, are all under fire, and Microsoft has fought an epic battle. The view in Washington is that Mrs Vestager's probe of the Russian gas giant Gazprom is being conducted with kid gloves, and that she is strangely accommodating over the Nord Stream pipeline so favoured by Germany. It is almost as if some in Brussels view America as the real enemy. Or, you could just take the non-conspiratorial view that the EU is going after corporations who don't pay their fair share of the tax burden - and most of those seem to be American corporations. As for the situation with Gazprom, there is a significant difference between dealing with service companies like Amazon or Starbucks whose operation in the EU does not affect the various nations' ability to function, and an energy provider such as Gazprom. If Starbucks decides to leave in a huff EU citizens may pine for their lattes, but antagonise Gazprom and many citizens will go cold this winter. America, and anti-EU organisations/entities, may be trying to portray the EU's activities as "anti-American", but there is no credible evidence this is the case. 2 Link to comment Share on other sites More sharing options...
+DieChecker Posted September 3, 2016 #18 Share Posted September 3, 2016 On 8/31/2016 at 11:51 AM, bmk1245 said: Apple will just move elsewhere, and several thousand workers will have to find work elsewhere EU politicians...... "Pish... It's only Irish workers....." Not like their target is Germany or France... 2 Link to comment Share on other sites More sharing options...
stevewinn Posted September 3, 2016 #19 Share Posted September 3, 2016 (edited) Well its opened a can of worms Austria's Finance Minister is now saying Amazon, Google, Microsoft and Starbucks pay less tax than a sausage stall. He added that EU countries with low corporate taxes were undermining the structure of the union itself. "What Ireland, the Netherlands, Luxembourg or Malta are doing here lacks solidarity towards the rest of the European economy," he said and praised the European Commission's recent order that Apple should pay 13bn euros (£11bn) more in tax to Ireland. Apparently when the UK voted Leave, with the UK out the way those who remain could get on building Europe, now it seems the naming calling as started. After all, the EU is just one big happy family and bound to play fair amongst themselves.. If they are like this now imagine what they'll be like when the UK's £18Billion contribution blackhole needs replacing. - its all got to come out of the 27 members coffers. Reminder - On Wednesday 14 September 2016, the President of the European Commission, Jean-Claude Juncker, will deliver his State of the Union address at the European Parliament. - It should be a laugh. Edited September 3, 2016 by stevewinn 2 Link to comment Share on other sites More sharing options...
Grey Area Posted September 3, 2016 #20 Share Posted September 3, 2016 2 hours ago, Leonardo said: Or, you could just take the non-conspiratorial view that the EU is going after corporations who don't pay their fair share of the tax burden - and most of those seem to be American corporations. As for the situation with Gazprom, there is a significant difference between dealing with service companies like Amazon or Starbucks whose operation in the EU does not affect the various nations' ability to function, and an energy provider such as Gazprom. If Starbucks decides to leave in a huff EU citizens may pine for their lattes, but antagonise Gazprom and many citizens will go cold this winter. America, and anti-EU organisations/entities, may be trying to portray the EU's activities as "anti-American", but there is no credible evidence this is the case. The thing is, that's all fine, but this is an incredibly overt move bordering on hostile. regardless of the nationality of Apple one thing stands out. Apple has been in Ireland since 1991. The tax affairs of Apple in Ireland are public record. that begs what is to me the big question, why now? as far as I can see there are 2 likely possibilities. Either this is about Brexit, or the EU has waited until Apple had grown sufficiently and established itself in Europe before springing the trap, so to speak. the outcome will be a lot simpler, Apples lawyers will tie up the process indefinitely while Apple returns to the US, as it has already suggested. by the time they have to pay up, they will have earned twice the bill in interest alone. 2 Link to comment Share on other sites More sharing options...
Leonardo Posted September 3, 2016 #21 Share Posted September 3, 2016 (edited) 27 minutes ago, Grey Area said: The thing is, that's all fine, but this is an incredibly overt move bordering on hostile. regardless of the nationality of Apple one thing stands out. Apple has been in Ireland since 1991. The tax affairs of Apple in Ireland are public record. that begs what is to me the big question, why now? as far as I can see there are 2 likely possibilities. Either this is about Brexit, or the EU has waited until Apple had grown sufficiently and established itself in Europe before springing the trap, so to speak. the outcome will be a lot simpler, Apples lawyers will tie up the process indefinitely while Apple returns to the US, as it has already suggested. by the time they have to pay up, they will have earned twice the bill in interest alone. The timing of the ruling seems to be entirely coincidental. The EU has been going after big corporations for not paying a fair rate of tax for many years, and until recently was embroiled with sorting out other corporations. Apple is merely the latest on the list, as the EU department involved doesn't have the resources to tackle all the corporations simultaneously. There is no Brexit connection here, nor is it a case of the EU "waiting until Apple got large enough to 'spring the trap'". Here's an article from the WSJ about the issue. Edited September 3, 2016 by Leonardo 2 Link to comment Share on other sites More sharing options...
Parsec Posted September 3, 2016 #22 Share Posted September 3, 2016 On 1/9/2016 at 1:46 AM, Clair said: Ohh, our tax code allows for a one heck of a retaliation against Europe. But why? Shouldn't a capitalist country not mess with the market, especially if we're talking about the USA? EU is not "attacking" US, but a multinational, private, company. So why exactly the US government should retaliate? Link to comment Share on other sites More sharing options...
Leonardo Posted September 3, 2016 #23 Share Posted September 3, 2016 33 minutes ago, Parsec said: But why? Shouldn't a capitalist country not mess with the market, especially if we're talking about the USA? EU is not "attacking" US, but a multinational, private, company. So why exactly the US government should retaliate? The US Fed is throwing a tantrum because, if Apple has to pay more tax to Ireland it's parent corporation HQ in the US won't be able to declare as large a profit, thus meaning the US tax service loses out on some income. 1 Link to comment Share on other sites More sharing options...
toast Posted September 3, 2016 #24 Share Posted September 3, 2016 10 hours ago, Silver_Lyre said: ...besides, the less tax that Apple or any other corporation pays means that the average Joe has to pay more. Thats a nice dream or do you really believe that a country would decrease the tax rates for Average Joe just in case blue chip companies would pay the full rate? Especially Ireland, with a government debt to GDP of 93.80 percent of the country's GDP in 2015 ? Link to comment Share on other sites More sharing options...
Grey Area Posted September 3, 2016 #25 Share Posted September 3, 2016 3 hours ago, Leonardo said: The timing of the ruling seems to be entirely coincidental. The EU has been going after big corporations for not paying a fair rate of tax for many years, and until recently was embroiled with sorting out other corporations. Apple is merely the latest on the list, as the EU department involved doesn't have the resources to tackle all the corporations simultaneously. There is no Brexit connection here, nor is it a case of the EU "waiting until Apple got large enough to 'spring the trap'". Here's an article from the WSJ about the issue. Yes and we have seen some of these, one big one in the UK being Starbucks. But there is a major difference, between those corporations actively engaged in tax avoidance and that of Apple. i just don't see the timing, or the excuse that resources prevented the EU from getting to them until now being valid, so the EU has been chasing so many corporations it has taken them 25 years to get around to them? And yet they sat silent when Ireland first struck the tax agreement with them 25 years ago? These large corporations pay an army of lawyers and accountants and economists to handle their finances, and yet they somehow managed to be blindsided by this action? Even though the EU has been doing this to so many other corporations that they have only now got around to dealing with Apple? Now I don't really see a conspiracy here, I think it is too bold, too overt for that, but I do doubt the coincidences of the timing. 1 Link to comment Share on other sites More sharing options...
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