Apple ordered to pay 13bn euro tax bill to Ireland, both to appeal

[webfact]

Apple ordered to pay 13bn euro tax bill to Ireland, both to appeal

 

 

DUBLIN: -- The European Commission has taken a big bite out of Apple.

 

The tech giant has been ordered to pay up to 13 billion euros in back taxes to the Irish government in Dublin.

 

The EU accused Apple, which employs thousands of people in Ireland, of benefiting unfairly from special arrangements with the country that allowed it to keep its tax bills there to a minimum. The EC ruled the scheme, which saw profits routed through Ireland, was illegal state aid.

 

Competition Commissioner Margrethe Vestager explained: “We see these 13 billion euros as unpaid taxes that due to Irish tax rulings allowed Apple to put a lot of their profits in a head office that only existed on paper, a head office that was not to be taxed due to Irish legislation. And that is a very selective benefit to a company and that is not allowed in the EU.”

 

As a result, the bloc slapped Europe’s biggest ever tax penalty on Apple.

 

The tech giant paid a tax rate on European profits of between 0.005 and 1 percent, the Commission said.

 

 

“Bizarre”

 

Ireland’s finance minister Michael Noonan denounced the order from Brussels: “As far as I am concerned there is no economic basis for this decision. It’s bizarre and it’s an exercise in politics by the Competition Commission.”

 

He told state broadcaster RTE: “They don’t have responsibility for taxes and they are opening a back door through state aid to influence tax policy in European countries when the European treaties say tax policy is a matter for sovereign governments,” he added.

 

Ireland’s low corporate tax rate has been a cornerstone of economic policy for 20 years, drawing investors from major multinational companies whose staff account for almost one in 10 workers in the country.

 

Both Apple and Ireland deny any wrongdoing and have said they will appeal against the decision.

 

“No basis in fact or in law”

 

In a letter to customers Apple’s chief executive Tim Cook said: “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 bill is far more than the 30 million euros each the European Commission previously ordered Dutch authorities to recover from US coffee chain Starbucks and Luxembourg from Fiat-Chrysler for their tax deals.

 

Both companies and countries have appealed against those decisions.

 

US disappointed

 

The US government has also weighed into the row, previously accusing the European Commission of deliberately targeting American firms – something Brussels denies.

 

On Tuesday a US Treasury official would not comment specifically on the Apple case, but said Washington is disappointed that the EU Commission has acted unilaterally.

 

“The Commission’s actions could threaten to undermine foreign investment, the business climate in Europe, and the important spirit of economic partnership between the US and the EU,” the spokesperson said.

 

A huge tax bill is likely to make all the wrong headlines ahead of early September’s expected unveiling of Apple’s latest iPhone.

 

 

-- © Copyright Euronews 2016-08-31

[jaggiss]

Rotten Apple.

[stander]

Australia also looking to get their share of the spoils.

 

Apple's headache is the start of tax revenue wars - and Australia may join the fight.

 

http://www.smh.com.au/business/the-economy/apples-headache-is-the-start-of-tax-revenue-wars--and-australia-may-join-the-fight-20160830-gr528m.html

[Hayduke]

Couldn't happen to a nicer company.

[Ralf61]

Don't worry, Apple. Just a storm in a teacup. The Europeans don't have the guts to mess around with a big one...

Edited August 31, 2016 by Ralf61

[spidermike007]

The reality is, if Obama was not so soft, and easily bought, they would be paying this amount to the US. It is an American company, that has been allowed to skirt US tax policy for quite some time, due to ridiculous loopholes in the law. Corporate tax policy in the US is completely broken. Why not just admit that fact, and begin to reform the system? Most corporations pay far lower taxes, percentage wise, than most individuals, that are not super rich. The super rich pay very little as they can afford creative advisors, and the tax code was designed with them in mind. 

[Rancid]

Seems many multinationals pay little or no tax, they have the money to spend on armies of accountants and lawyers to get around laws. But are the Apple savings being reflected in cheaper products or are they being eaten up in management bonuses? Recall Cadburys in UK pays none, many in Oz pay little or none.

 

The average person gets regularly audited and harassed by tax departments to cough up, dodging tax even leads to jail, seems our corporate feudal overlords live under different rules, suspect this is far from over. US citizens get tracked all over the world by the IRS, yet their government complains if a US corporation has to actually pay tax, hmm.

[SteveB2]

This news is just crazy - you can't make it up. 

 

Apple is happy with the arrangement

The Irish government is happy with the arrangement

But oh no!  - The EU Plutocracy throws a hissy fit and takes them both to court for not playing their game and abiding by their rules.

 

Somewhat similar to a happy prostitute and one of her recently satisfied 'Johns' being berated by some belligerent religious do-gooder.

Both buyer and seller are happy. It's a victimless crime. Keep your nose out their business and leave them alone. It's going to go on one way or another anyway.

 

Nevermind Apple - Once Brexit is in process, the United Kingdom will soon be 'Open for business' and will be very happy to host your business activities under independent friendly tax conditions.

http://www.telegraph.co.uk/technology/2016/08/30/apple-ordered-to-pay-11bn-after-european-union-tax-investigation/

 

As for the EU plutocracy - what's really going on is, of course, way to complicated for the proletariat to fathom out -  however, for those with half a brain and a cup of coffee in front of them, peruse the following:-

http://www.globalresearch.ca/greece-no-to-eu-plutocracy-how-the-empire-will-strike-back-overthrow-the-government-is-the-preferred-option/5461190

 

 

[Caps]

Yet another interference by Eurocrats?  Telling countries what to do.   Or is it just sour grapes over the possible failing of the Trade Agreement with the US?

[Srikcir]

6 hours ago, webfact said:

The tech giant has been ordered to pay up to 13 billion euros in back taxes to the Irish government in Dublin.

And the Irish government doesn't want to collect!

It is the EU that is opposing Apple using Ireland as a tax haven, not the Irish government.

For Ireland to begin dismantling its tax havens will mean a flight of billion dollar foreign companies from Ireland for better tax havens.

[Silurian]

3 hours ago, spidermike007 said:

The reality is, if Obama was not so soft, and easily bought, they would be paying this amount to the US. It is an American company, that has been allowed to skirt US tax policy for quite some time, due to ridiculous loopholes in the law. Corporate tax policy in the US is completely broken. Why not just admit that fact, and begin to reform the system? Most corporations pay far lower taxes, percentage wise, than most individuals, that are not super rich. The super rich pay very little as they can afford creative advisors, and the tax code was designed with them in mind. 

 

I guess you could blame Obama if you wanted to but Apple has been using Ireland as a tax base since 1991 well before Obama was in office. I believe George Bush Sr. was in office at that time. Seems like the corporate tax policy has been broken for some time. I think you could actually spread this "blame" around to both Republicans and Democrats not fixing it.

[Baerboxer]

1 hour ago, Srikcir said:

And the Irish government doesn't want to collect!

It is the EU that is opposing Apple using Ireland as a tax haven, not the Irish government.

For Ireland to begin dismantling its tax havens will mean a flight of billion dollar foreign companies from Ireland for better tax havens.

 

Maybe the EU will start looking at Luxembourg and the non EU but EEA/Schengen Liechtenstein activities around tax - personal and corporate. 

As per usual certain EU members who wield power like to attack others but keep their own little scams hidden away.

[Srikcir]

1 hour ago, Baerboxer said:

Maybe the EU will start looking at Luxembourg and the non EU but EEA/Schengen Liechtenstein activities around tax - personal and corporate. 

The EU appears to developing mechaisms to do exactly what you suggest with implementation in 2017, at least at the corporate level.

https://euobserver.com/economic/133019

[ballpoint]

The EU meddling in a sovereign nation's internal affairs. Who'd have thought it?  Coming soon: Irexit.

[GinBoy2]

This topic never fails to entertain. From the multitude of Brit's previously whining about multinationals in their country being registered in Ireland, Luxembourg or wherever to 'minimize' tax to the latest bill, to now the EU imposing back tax despite an on the surface valid agreement between Apple & Sovereign Government, it's the comedy gift that keeps on giving.

 

I'm not defending the multinationals in any way, but 'you' elect the governments that pass the laws, negotiate the deals, set the rules. If I could legally reduce my tax bill, who in their right mind wouldn't? For some non elected body to turn around and decide retrospectively that an agreement entered in good faith, with what at least is on paper a Sovereign entity is so against natural justice, it's past funny.

 

So stop pointing fingers at the Apple, Starbucks, Fiat's of the world, and get off your collective asses and vote in Governments that might actually have your interests at heart, and stop pandering to tabloid hysteria

[thaihome]

12 hours ago, spidermike007 said:

The reality is, if Obama was not so soft, and easily bought, they would be paying this amount to the US. It is an American company, that has been allowed to skirt US tax policy for quite some time, due to ridiculous loopholes in the law. Corporate tax policy in the US is completely broken. Why not just admit that fact, and begin to reform the system? Most corporations pay far lower taxes, percentage wise, than most individuals, that are not super rich. The super rich pay very little as they can afford creative advisors, and the tax code was designed with them in mind. 

 

Obama proposed a solution to the deferred offshore profit issue last year, whistling.gif republicans in congress refused to even hold hearing on

 

President Barack Obama's fiscal 2016 budget will seek new taxes on trillions of dollars in profits accumulated overseas by U.S. companies, and a new approach to taxing foreign profits in the future, but Republicans were skeptical of the plan on Sunday.

Reviving a long-running debate about corporate tax avoidance, Obama will target a loophole that lets companies pay no tax on earnings held abroad, the White House said. But his proposal was certain to encounter stiff resistance from Republicans.

http://www.reuters.com/article/us-usa-budget-tax-idUSKBN0L51IX20150201

 

Just sayin', you know. Republicans are, of course, we'll known for promoting taxes on the rich and corporations. 

 

TH 

[Andaman Al]

If this went through, apple would upticks and leave Ireland and thousands of high skilled workers would be unemployed and billions of dollars in salaries to the workers who spend in the economy would disappear over night. I guess Ireland will vote next for their exit 'Irexit'.

 

Well done the UK for getting out.

 

13 hours ago, spidermike007 said:

The reality is, if Obama was not so soft, and easily bought, they would be paying this amount to the US. It is an American company, that has been allowed to skirt US tax policy for quite some time, due to ridiculous loopholes in the law. Corporate tax policy in the US is completely broken. Why not just admit that fact, and begin to reform the system? Most corporations pay far lower taxes, percentage wise, than most individuals, that are not super rich. The super rich pay very little as they can afford creative advisors, and the tax code was designed with them in mind. 

 

First thing is that your statement is far from a reality. It is nothing to do with Obama much as you would like to blame him for everything including your constipation. Obama was trying to tackle this very issue and like most bills he needed to pass he was totally blocked by the Republicans, who shamefully have not worked for the US people for 8 years. If Obama wanted to pass a bill saying the sky is blue or water is wet then the Republicans would have countered it. Blame your republican Bush dynasty for this little mess - one which unsurprisingly they profited formatting with their cronies.

[JHolmesJr]

Apple, Google, Amazon, Starbucks etc need to be taken behind a shed and given a working over with the taxman's knuckle dusters…..they are the worst kind of corporate citizens….you could fund a few countries' annual budgets with the money they owe.

 

 

[Opl]

Apple's Tax assemply  in Europe, supported by Ireland, according to the European Commission:  Apple has' avoided tax on virtually all the profits generated by sales of Apple products throughout the EU single market ".

 

1/ all the benefits of European sales were registered in Ireland  credited to Apple Sales International (  [Irish company 100% owned by Apple, Ed] )

 

2) but only a small percentage of the profits of Apple Sales International was taxed in Ireland, the rest being taxed nowhere  ( " Indeed, the headquarters of Apple Sales International, declared as outside Ireland, "was not located in any country, had no employees and did not own premises."). In 2011, the Irish subsidiary made a profit of 16 billion euros, but "only about 50 million were considered as taxable in Ireland"

 

3/ this preferential treatment granted by Ireland "has allowed Apple to be applying an effective tax rate of about 1% on its European profits in 2003, rates decreased to 0.005% in 2014".

 

see the graphic in this link below

 

http://www.lepoint.fr/chroniqueurs-du-point/guerric-poncet/apple-vs-ue-double-gain-pour-dublin-30-08-2016-2064784_506.php

 

 

Edited August 31, 2016 by Opl

[Thorgal]

Corporate imperialism and colonialism...and this will result in sirtaki and broken plates all over Dublin...


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[Maestro]

Irish Cabinet meeting about Apple tax ruling adjourned until Friday

31 August 2016

 

The Republic of Ireland's Cabinet meeting to discuss the European Commission's decision that Ireland granted undue tax benefits of up to €13bn (£11bn) to Apple has been adjourned.

Finance Minister Michael Noonan said the Irish government will appeal the ruling.

Independent ministers have sought the recall of the Irish parliament if they are to back an appeal.

 

Read more: http://www.bbc.com/news/uk-northern-ireland-37228475

 

-- BBC   2016-08-31

[Maestro]

Apple Irish tax ruling 'maddening', says Tim Cook

1 September 2016

 

Apple chief executive Tim Cook says the European Commission ruling that Apple should pay billions of euros in back taxes to the Republic of Ireland is "maddening" and "political".

He told Irish broadcaster RTE that Apple had not been given preferential tax breaks in Ireland.

The EU ruling said Apple had been given €13bn of "illegal" tax benefits.

 

Read more: http://www.bbc.com/news/world-europe-37242357

 

-- BBC   2016-09-01