Ireland wins Apple case

Hillmanhunter1

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However Sinn Féin’s finance spokesperson Pearse Doherty said today is “a bad day for the taxpayer”.


“The Department of Finance may be thinking that this is a good day for themselves. Morally, this is a terrible day, the fact that the richest company in the world was able to generate over €100 billion of profits and not pay tax anywhere in the world on those profits despite the fact that the way the companies are incorporated here in Ireland.”

Ya, but economics is not really the Shinner's forte.

(I edited this post after having a quick peek at SF's 2020 manifesto:
"Sinn Féin values foreign direct investment and is committed to retaining the 12.5% corporation tax rate that has been key in attracting many multinational corporations to locate in Ireland. We would continue to support the IDA efforts to attract FDI to these shores."
A case of running with the hare and hunting with the hound?)
 
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Orbit v2

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If a Sinn Féin government had decided not to appeal, but Apple would have done anyway, then today we would have been on the losing side, looking like we tried to pull off a 13 billion euro heist, which failed.
 

shiel

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However Sinn Féin’s finance spokesperson Pearse Doherty said today is “a bad day for the taxpayer”.


“The Department of Finance may be thinking that this is a good day for themselves. Morally, this is a terrible day, the fact that the richest company in the world was able to generate over €100 billion of profits and not pay tax anywhere in the world on those profits despite the fact that the way the companies are incorporated here in Ireland.”

The free market operating in a democratic environment is anything but perfect.

But the alternative in which the state controlled everything in a totalitarian system was bloody well even less perfect and collapsed when the Soviet Union was no more.

Sinn Fein are hypocritical in seeming to back whatever side of that debate suits the argument at the time.

If they get into power they may leave this country half way between Greece and Venezuela.

Their reaction to the Apple case was hypocrisy writ large.
 

McTell

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Great result. A sovereign state can set its own taxes.

And if it's in a trading bloc with free trade, that was 100% understood at the time.

And if it's part of a currency union where everyone can charge different taxes in the same currency, that also was 100% understood at the time.

Vat / local sales taxes are often 5% around the world. Corporation tax is one of the recent inventions to pay for world war 2. We only adopted it to appear modern.
 

Lord Talbot

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Yet more proof the plastic cabinet aka European Commission haven't got a clue about global economic forces.

The commission probably the weakest link in the EU structure.
 

StormWarning

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Ya, but economics is not really the Shinner's forte.

(I edited this post after having a quick peek at SF's 2020 manifesto:
"Sinn Féin values foreign direct investment and is committed to retaining the 12.5% corporation tax rate that has been key in attracting many multinational corporations to locate in Ireland. We would continue to support the IDA efforts to attract FDI to these shores."
A case of running with the hare and hunting with the hound?)
The chinese can make those €1000 phones for $100 and just as reliable so profits are stratospheric and still they do their utmost to pay neigible tax.
I think it may be time to consider tax harmonisation in the EU and shut these plutocrats out of the market if they don't want to pay anything back that maintains the social-democratic structures that made Europe so wealthy and stable in the first place.
 

shiel

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The chinese can make those €1000 phones for $100 and just as reliable so profits are stratospheric and still they do their utmost to pay neigible tax.
I think it may be time to consider tax harmonisation in the EU and shut these plutocrats out of the market if they don't want to pay anything back that maintains the social-democratic structures that made Europe so wealthy and stable in the first place.
Anything that undermines our 12.5% corporation tax system together with our veto in the EU in relation to what is a vital national interest is a major negative.

Harmonisation of the tax system plays into the hands of the big countries like Germany and France and is a no no.
 

Ardillaun

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I can’t see the current Silicon Valley business and tax model being tolerated indefinitely by large states around the world.
 

Orbit v2

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The chinese can make those €1000 phones for $100 and just as reliable so profits are stratospheric and still they do their utmost to pay neigible tax.
I think it may be time to consider tax harmonisation in the EU and shut these plutocrats out of the market if they don't want to pay anything back that maintains the social-democratic structures that made Europe so wealthy and stable in the first place.
As the Apple product blurb says : "Made in China. Designed in California"

You can't just ignore the costs and intellectual property that went into designing these products and say - sure they only cost $100 to make.

In the case of software/ad services like what google sells, there is no manufacturing cost at all, and it's all intellectual property.

The big picture here is not whether Apple should have paid 13 billion in tax here (clearly it shouldn't) but to what extent does it owe those taxes to Europe where the products are sold, versus the US where they were designed/conceived? There isn't a simple answer to that and the commission tried to short circuit the work that is trying to answer that and steam roll their "solution" disguised as a state-aid/competition case. Note, how the spokes-people for the commission dropped the mask today by saying "we think companies should pay their fair share of tax" basically admitting it had nothing to do with state-aid or competition at all.
 

callas

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Apple says that it is the largest tax payer in the world.



Apple said it was pleased that the court has annulled the commission's case.

"This case was not about how much tax we pay, but where we are required to pay it," it said in a statement.

"We're proud to be the largest taxpayer in the world as we know the important role tax payments play in society.

"Apple has paid more than $100 billion in corporate income taxes around the world in the last decade and tens of billions more in other taxes."

It seems that if the EU are truly concerned with state support of tech companies, they are looking in the wrong place and at the wrong company.




For those following Huawei’s substantial rise over the past several years, it’ll come as no surprise that the Chinese government played an important role in fostering the hardware maker. Even so, the actual numbers behind the ascent are still a bit jaw-dropping. Huawei reportedly had “access to as much as $75 billion in state support,”
 

Mercurial

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Ireland can't be expected to dismantle capitalism on its own. Let the EU put its own money where its mouth is rather than expecting a tiny country like Ireland to lead the way in fighting corporate greed.
 

jmcc

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Anything that undermines our 12.5% corporation tax system together with our veto in the EU in relation to what is a vital national interest is a major negative.

Harmonisation of the tax system plays into the hands of the big countries like Germany and France and is a no no.
Sounding a bit like a Brexiteer, Shiel. :) So much for Ireland joining a glorious union of equals, eh?
 

Sync

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Really interesting FT article. It’s amazing how comfortable some people are to go on the record and outright admit this is an end run around sovereignty and unanimity on tax rules.

The European Commission said on Wednesday it was now turning towards an obscure and previously unused EU treaty article as it seeks fresh ways to crack down on aggressive corporate tax planning and circumvent member states’ vetoes over critical questions of tax policy.

But policymakers and lawyers warned there are no easy options ahead for Brussels following the courtroom defeat. “This is a huge setback — we are running into a brick wall when it comes to tackling this divisive problem of excessive tax competition between member states,” said Luis Garicano, a Spanish MEP and vice-chair of the Renew Europe group.

“With the state aid route now essentially dead, the commission is right to look at using internal market rules to get around the need for unanimity. It is the final bullet left, and they need to use it.”
So let’s try and find a way to circumvent the spirit of the Union as we can’t find any actual breaches of the law!

This is very different to the cases of Poland and Hungary on social issues where they’re clearly going against EU requirements and the rest of the EU is trying to figure out how to punish them, Ireland and Luxembourg etc ARE following the requirements. But some in the EU don’t like the requirements and are trying to change them by circumvention.

And whether you like Apple or not: it is not fair to pick on any specific company to be the whipping boy in that conflict. Companies need to follow the law in the country they’re in. Apple’s doing that. It makes the EU look like a place that’s hostile to business.
 

Levellers

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Ya, but economics is not really the Shinner's forte.

(I edited this post after having a quick peek at SF's 2020 manifesto:
"Sinn Féin values foreign direct investment and is committed to retaining the 12.5% corporation tax rate that has been key in attracting many multinational corporations to locate in Ireland. We would continue to support the IDA efforts to attract FDI to these shores."
A case of running with the hare and hunting with the hound?)
Not the 0.005 percent rate applied to Apple.
 

Hillmanhunter1

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Not the 0.005 percent rate applied to Apple.
The Court found that the Commission did not succeed in demonstrating that the contested tax rulings had granted Apple a selective advantage. In other words the Irish tax regime was applied to Apple in a fair manner and in the same way as it would have been applied to any other similar company, domestic or international.

If there is something specific that SF wants to change about the operation of the tax regime then they need to spell it out, and then we can debate the merits(s) of their ideas.

Otherwise it will look as if they are talking out of both sides of their mouth - telling the multinationals that the tax regime will not change, while whining about it in the popular media.
 

McTell

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I can’t see the current Silicon Valley business and tax model being tolerated indefinitely by large states around the world.

States should be making efficiencies and becoming ever cheaper to run. Quite a lot of tax avoidance comes from seeing the waste day in, year out.

And jobs for life, if they want them. By definition, the more able will leave for the upper reaches of the private sector, and the less able are left behind. Not a good business model.

Plus an obsessive secrecy based on us taking on the entire british civil service here in 1922. With some exceptions, government budgets are secretive. If you want us to gladly pay tax, then be more open about what it is being spent on. If it's on a TD's pet project to get him more votes the next time around, fair enough, maybe he should chip in half his salary for the next 10 years.

We are a small country that should be easy to run.

Then at the EU level, we see "mission creep" way beyond the single market that we signed up for. Its own GPS system, its own army, its own diplomatic corps - the list expands every year, without any obvious payback for sean citizen.
 

Lumpy Talbot

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No
' Apple used this new capital allowance scheme in 2016 to shift its intellectual property out of Jersey into Ireland. This onshoring of €300bn of capital created the infamous 26% growth in Irish GDP. But this is little more than leprechaun economics – using Ireland as a treasure island for storing the intangible capital assets of big-tech multinational enterprises. And until the EU creates common laws that make tax avoidance in member states illegal, small sovereign states will continue to play an important role in helping global corporations minimise the tax they pay. ' Until the EU tackles tax avoidance, big companies will keep getting away with it | Aidan Regan
 


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