Trump Goes After Apple and Others Dodging Taxes in Ireland

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Traditionally, much of the appeal of an Irish base was the ability to house a company’s intellectual property in Ireland. Tech companies then attribute a significant share of global sales and profits to that IP and so pay the 12.5pc rate rather than a higher tax in the nation where sales are made.

 “They pay corporate tax on 3pc profit in America and Ireland announces a massive budget surplus for their 5m people."

https://www.telegraph.co.uk/business/2025/01/25/donald-trump-plan-crush-ireland-economic-miracle/

 

I have to give Trump credit if his administration actually follows through on this.  While The Telegraph puts a negative spin on this in their headline, actually it's long overdue.

[stevenl]

37 minutes ago, placeholder said:

Traditionally, much of the appeal of an Irish base was the ability to house a company’s intellectual property in Ireland. Tech companies then attribute a significant share of global sales and profits to that IP and so pay the 12.5pc rate rather than a higher tax in the nation where sales are made.

 “They pay corporate tax on 3pc profit in America and Ireland announces a massive budget surplus for their 5m people."

https://www.telegraph.co.uk/business/2025/01/25/donald-trump-plan-crush-ireland-economic-miracle/

 

I have to give Trump credit if his administration actually follows through on this.  While The Telegraph puts a negative spin on this in their headline, actually it's long overdue.

The issue is that Ireland amongst many countries is committed to levying a minimum of 15 pct. Which according to trump is harming US interests.

[placeholder]

50 minutes ago, stevenl said:

The issue is that Ireland amongst many countries is committed to levying a minimum of 15 pct. Which according to trump is harming US interests.

That's' only a part of it. The issue at question here is whether Apple and other corporations should be paying taxes  on income to Ireland given that almost all of the value of the product is created elsewhere and almost all of the income is earned elsewhere.

[stevenl]

1 hour ago, placeholder said:

That's' only a part of it. The issue at question here is whether Apple and other corporations should be paying taxes  on income to Ireland given that almost all of the value of the product is created elsewhere and almost all of the income is earned elsewhere.

Hence the 15 pct minimum requirement. A more level playing field would result in less reason to file in countries with lower tax burden like Ireland and more in the country where the value is created.

[placeholder]

21 minutes ago, stevenl said:

Hence the 15 pct minimum requirement. A more level playing field would result in less reason to file in countries with lower tax burden like Ireland and more in the country where the value is created.

But why should these corporations have any reason at all to be filing there unless it's for legitimate reasons? Why should those tax monies flow to a place where most of the income isn't really generated? As a disincentive,  a 15% minimum may be an improvement, but it's not good enough.

[stevenl]

13 minutes ago, placeholder said:

But why should these corporations have any reason at all to be filing there unless it's for legitimate reasons? Why should those tax monies flow to a place where most of the income isn't really generated? As a disincentive,  a 15% minimum may be an improvement, but it's not good enough.

Please read again and understand. "less reason to file in countries with lower tax burden like Ireland and more in the country where the value is created.".

[placeholder]

12 minutes ago, stevenl said:

Please read again and understand. "less reason to file in countries with lower tax burden like Ireland and more in the country where the value is created.".

As I noted, that's a disincentive. But it's not a prohibition. It effectively puts a ceiling on how much tax a country can impose. And it doesn't answer the question of why Ireland, or any other country, should benefit from economic activity that has little or nothing to do with them.

[stevenl]

1 hour ago, placeholder said:

As I noted, that's a disincentive. But it's not a prohibition. It effectively puts a ceiling on how much tax a country can impose. And it doesn't answer the question of why Ireland, or any other country, should benefit from economic activity that has little or nothing to do with them.

A pity this is above your paygrade.

[placeholder]

34 minutes ago, stevenl said:

A pity this is above your paygrade.

You've got nothing.

[stevenl]

19 minutes ago, placeholder said:

You've got nothing.

To start at the beginning, your heading is wrong. Trump is not going after apple, he is trying to protect apple from higher taxes in Europe.

[Yellowtail]

3 hours ago, placeholder said:

But why should these corporations have any reason at all to be filing there unless it's for legitimate reasons? Why should those tax monies flow to a place where most of the income isn't really generated? As a disincentive,  a 15% minimum may be an improvement, but it's not good enough.

Avoiding taxes is a legitimate reason. A lot of people are fleeing California to avoid taxes.

 

Corporate income taxes should be 0% in the US for companies that have the bulk of their operations in the US. 

 

Corporate taxes (like tariffs) are paid by the consumer.

 

People argue against tariffs claiming they raise prices, yet the same people howl when cutting corporate income taxes comes up. 

 

Tariffs make imported products more expensive, while corporate income taxes make domestic products more expensive. 

[placeholder]

2 hours ago, stevenl said:

To start at the beginning, your heading is wrong. Trump is not going after apple, he is trying to protect apple from higher taxes in Europe.

Really? Apple assigns its income to Ireland  because it wants to get taxed at a higher rate than would be the case in the USA?

Apple pays a 12.5% income  tax rate to Ireland.

"Ireland has a low corporate tax rate of 12.5 percent. Net operating losses can be carried back one year and carried forward indefinitely, allowing companies to be taxed on their average profitability."

https://www.google.com/search?q=Irish+tax+rate+on+corporations&oq=Irish+tax+rate+on+corporations&gs_lcrp=EgZjaHJvbWUyBggAEEUYOdIBCDkwMThqMGo3qAIIsAIB&sourceid=chrome&ie=UTF-8

 

And from the article:

Howard Lutnick, the president’s pick as commerce secretary, said in October that American businesses should pay more to the US Treasury instead of filling the coffers of foreign nations.
He singled out Apple’s experience in Ireland as a prime example of the behaviour he wanted to stamp out.

[placeholder]

2 hours ago, Yellowtail said:

Avoiding taxes is a legitimate reason. A lot of people are fleeing California to avoid taxes.

 

Corporate income taxes should be 0% in the US for companies that have the bulk of their operations in the US. 

 

Corporate taxes (like tariffs) are paid by the consumer.

 

People argue against tariffs claiming they raise prices, yet the same people howl when cutting corporate income taxes comes up. 

 

Tariffs make imported products more expensive, while corporate income taxes make domestic products more expensive. 

Nonsense. Companies charge whatever price consumers will pay. Unless you  believe that demand won't falter no matter how high the price a company will charge. You might want to look into the issue of profit margins.

As for avoiding taxes being a legitimate reason. Not if the government says it isn't. And as for your point about passing tax costs on to the consumer. So if corporations don't pay those taxes, who will make up the difference? And please, spare us the argument that taxes should be lower. That's just evading the question.

[jas007]

Am I mistaken, or has Ireland already addressed some of these issues via legislation?  The effective tax rates there will no longer be so low?  Either that or there have been some significant court cases. Maybe both. 

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Just now, jas007 said:

Am I mistaken, or has Ireland already addressed some of these issues via legislation?  The effective tax rates there will no longer be so low?  Either that or there have been some significant court cases. Maybe both. 

It did sign on to that agreement. But even putting aside its liberal rules for deductions, why should a country where most of the value is generated and where a substantial chunk of the profit gets made, not be paid taxes on that? And why should the level be set at 15%? What if a country charges corporations 20%? Why shouldn't corporations based there pay taxes that are based on reality?

[OneMoreFarang]

I didn't see Tim Cook together with Musk, Bezos and Zuckerberg at Trump's party.

Obviously, Trump can't accept that Cook didn't kiss his feet. 

 

[placeholder]

2 minutes ago, OneMoreFarang said:

I didn't see Tim Cook together with Musk, Bezos and Zuckerberg at Trump's party.

Obviously, Trump can't accept that Cook didn't kiss his feet. 

 

Tim Cook Is Latest Tech Exec to Kiss the Ring, Gives Trump’s Inauguration $1 Million
Cook is personally giving the money, keeping Apple out of it.

https://gizmodo.com/tim-cook-is-latest-tech-exec-to-kiss-the-ring-gives-trumps-inauguration-1-million-2000545840

[Yellowtail]

8 minutes ago, placeholder said:

Nonsense. Companies charge whatever price consumers will pay. Unless you  believe that demand won't falter no matter how high the price a company will charge. You might want to look into the issue of profit margins.

As for avoiding taxes being a legitimate reason. Not if the government says it isn't. And as for your point about passing tax costs on to the consumer. So if corporations don't pay those taxes, who will make up the difference? And please, spare us the argument that taxes should be lower. That's just evading the question.

"Companies charge whatever price consumers will pay."

 

And in the absence of competition consumers have to pay more. Do you think that cost does not affect price? If Albertson's has eggs for $5, and Safeway has eggs for $4, more people buy eggs at Alberson's. 

 

I worked in manufacturing most of my life and spent twenty years in management. The focus is always cutting costs to reduce price and gain market share. 

 

What do you think a fair profit margin is? 

[jas007]

6 minutes ago, placeholder said:

It did sign on to that agreement. But even putting aside its liberal rules for deductions, why should a country where most of the value is generated and where a substantial chunk of the profit gets made, not be paid taxes on that? And why should the level be set at 15%? What if a country charges corporations 20%? Why shouldn't corporations based there pay taxes that are based on reality?

You absolutely have a point, but companies exist in the legal realm, not necessarily in reality. Neither Apple nor any other company files their taxes based on "reality."  That's not how it works.  They act in the company's best interest. In the best interest of the owners, the shareholders.  If that means that Apple Computer rents out a small office in Dublin for their IP headquarters, so be it. 

[Phillip9]

29 minutes ago, placeholder said:

Apple assigns its income to Ireland  because it wants to get taxed at a higher rate than would be the case in the USA?

Apple's income from the US is already taxed in the USA.  Only its income from outside the US is taxed in Ireland.  

[placeholder]

5 minutes ago, Phillip9 said:

Apple's income from the US is already taxed in the USA.  Only its income from outside the US is taxed in Ireland.  

You might want to actually read the article. You might be surrprised.

[Phillip9]

5 minutes ago, placeholder said:

You might want to actually read the article. You might be surrprised.

 

I did read it.  It doesn't contradict what I stated.  You might want to read it yourself.

 

Again.  All of apple's income from sales in the US are taxed in the US.  International sales are taxed through it's subsidiary in Ireland. 

[candide]

20 minutes ago, placeholder said:

You might want to actually read the article. You might be surrprised.

 

9 minutes ago, Phillip9 said:

 

I did read it.  It doesn't contradict what I stated.  You might want to read it yourself.

 

Again.  All of apple's income from sales in the US are taxed in the US.  International sales are taxed through it's subsidiary in Ireland. 

Actually, it's not easy to find precise and recent information about the U.S.. In particular about IP rights. It seems Apple pays taxes on revenues in the U.S for sales in the U.S. However, it"s not clear about intellectual property rights. (Apple may or may not pay its Irish subsidiary for IP rights used in the U.S.)

 

it's more precise about the EU because of recent investigations and decisions 

[stevenl]

59 minutes ago, placeholder said:

Really? Apple assigns its income to Ireland  because it wants to get taxed at a higher rate than would be the case in the USA?

Apple pays a 12.5% income  tax rate to Ireland.

"Ireland has a low corporate tax rate of 12.5 percent. Net operating losses can be carried back one year and carried forward indefinitely, allowing companies to be taxed on their average profitability."

https://www.google.com/search?q=Irish+tax+rate+on+corporations&oq=Irish+tax+rate+on+corporations&gs_lcrp=EgZjaHJvbWUyBggAEEUYOdIBCDkwMThqMGo3qAIIsAIB&sourceid=chrome&ie=UTF-8

 

And from the article:

Howard Lutnick, the president’s pick as commerce secretary, said in October that American businesses should pay more to the US Treasury instead of filling the coffers of foreign nations.
He singled out Apple’s experience in Ireland as a prime example of the behaviour he wanted to stamp out.

You're getting there. He wants apple taxed in the us. Apple is now for a major part taxed in Ireland because it's cheaper than UK, France and other options.

[placeholder]

14 minutes ago, Phillip9 said:

 

I did read it.  It doesn't contradict what I stated.  You might want to read it yourself.

 

Again.  All of apple's income from sales in the US are taxed in the US.  International sales are taxed through it's subsidiary in Ireland. 

https://theweek.com/articles/476005/how-apple-dodges-billions-taxes-concise-guide

You might want to reference how Apple sells it intellectual property and services, which are mostly created in the United States, out of subsidiaries located in foreign countries where no tax needs to be paid.

[jas007]

5 minutes ago, stevenl said:

You're getting there. He wants apple taxed in the us. Apple is now for a major part taxed in Ireland because it's cheaper than UK, France and other options.

So in one fell swoop, people think that they can wave a magic wand and effect changes to international law, international tax treaties, and accounting practices for the taxation intellectual property profits?  

[NoDisplayName]

7 hours ago, stevenl said:

Hence the 15 pct minimum requirement. A more level playing field would result in less reason to file in countries with lower tax burden like Ireland and more in the country where the value is created.

 

So Apple and others should be filing taxes in China where most of the value is created?

 

Is this another of Trump's fun and easy to win trade wars?

[placeholder]

6 minutes ago, NoDisplayName said:

 

So Apple and others should be filing taxes in China where most of the value is created?

 

Is this another of Trump's fun and easy to win trade wars?

What makes you believe that most of the value is in China? Most of the value is in the intellectual property and the most valuable chips which are not manufactured in China. 

[khunJam]

11 hours ago, placeholder said:

I have to give Trump credit if his administration actually follows through on this.

You risk getting tarred by your fellow liberals for giving any sort of credit to trump.

[NoDisplayName]

9 minutes ago, placeholder said:

What makes you believe that most of the value is in China? Most of the value is in the intellectual property and the most valuable chips which are not manufactured in China. 

 

Some semiconductors and a few random bits are produced in Taiwan Province and Souf' Korea, shipped to China where the world's factory produces most of the device components, assembles them, packages them.

 

Then shipped to America for consumption.

 

Only thing Americaland provides any more is the label, and extraterritorial taxation.