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European Commission To Issue Apple An Irish Tax Bill of $1.1 Billion, Says Report (reuters.com)
An anonymous reader quotes a report from Reuters: The European Commission will rule against Ireland's tax dealings with Apple on Tuesday, two source familiar with the decision told Reuters, one of whom said Dublin would be told to recoup over 1 billion euros in back taxes. The European Commission accused Ireland in 2014 of dodging international tax rules by letting Apple shelter profits worth tens of billions of dollars from tax collectors in return for maintaining jobs. Apple and Ireland rejected the accusation; both have said they will appeal any adverse ruling. The source said the Commission will recommend a figure in back taxes that it expects to be collected, but it will be up to Irish authorities to calculate exactly what is owed. A bill in excess of 1 billion euros ($1.12 billion) would be far more than the 30 million euros each the European Commission previously ordered Dutch authorities to recover from U.S. coffee chain Starbucks and Luxembourg from Fiat Chrysler for their tax deals. When it opened the Apple investigation in 2014, the Commission told the Irish government that tax rulings it agreed in 1991 and 2007 with the iPhone maker amounted to state aid and might have broken EU laws. The Commission said the rulings were "reverse engineered" to ensure that Apple had a minimal Irish bill and that minutes of meetings between Apple representatives and Irish tax officials showed the company's tax treatment had been "motivated by employment considerations."
This would be an interesting ruling though as ANY tax breaks would become illegal in the EU and thus there would be no viable way for companies to keep their business in the richer EU countries.
Umm, what? If they are paying taxes it's because they are profitable. Tax avoidance like Apple is doing is the difference between profits and more profits. You don't get taxed when you are losing money. Companies that are profitable now in "richer EU countries" would remain so, just to a lesser degree. Anyway the EU is a monetary union and there are rules relating to the flow of money within a monetary union. Just like the US being a part of the EU means that countries have given away some sovereignty in exchange for economic benefits. That's not necessarily a bad thing.
Whenever a Hollywood studio wants to make a movie, they tell our government how much the taxpayers need to shell out to keep the jobs here. The last big deal cost us at least $75 million.
The threats are always that jobs will go overseas, but no thought about whether they are jobs worth keeping.
So the EU can just come down and tell it's member countries who they are and aren't allowed to give tax breaks to
Yes, and that's one of the fundamental necessities for a free trade zone.
It's quite easy, Ireland can make as many tax breaks as they want for Apple as long as they are out of EU. If they want to be in EU and trade in the EU open market, then they must be subject to some basic rules.
Also, Apple has to pay these taxes, because they had profit and they failed to pay their respective taxes for more than 1 decade. They aren't going bankrupt by paying taxes over their profits like you are saying.
Ireleave. Bye-rland.
You are not understanding the problem.
I will try to explain it to you.
1) apple may be headquartered in Cupertino CA, but not all of its sales are in the United states.
2) because of this, and the way international taxation works, there are "apple UK", "Apple china", "Apple Korea", etc. These are wholly owned subsidiaries of Apple USA, but the product produced and sold, is sold exclusively in the subsidiary's local market. This allows the local branch to be taxed by the locall tax authority, on the profits made by that local branch. In theory at least.
3) what really happens is that Apple Ireland, which pays essentially zero taxes, claims sales volumes for markets outside of ireland, knowing that regulators cannot easily disprove that Apple Ireland is not just selling absurd numbers of apple products, and making all that profit legitimately. This is especially true, when Apple USA tells Apple EU to buy exclusively from Apple Ireland, and charge EU customers busing from them essentially a flat shipping cost that is the exact amount they buy fro. Apple Ireland. That artificially moves sales originating in the EU to Ireland's accounting. The actuAL sale occurs inside Ireland, and thus is billable in Ireland, under Irish tax law. (NEVERMIND where the product actually ships to.)
4) Apple says this is perfectly legitimate, Ireland concurs, but EU feels otherwise. EU tells Ireland that sales from EU citizens are originating in the EU, and need to be billed and taxed accordingly.
5)Apple USA, and Apple Ireland don't want those sales to be reported as originating in the EU, because then they have to pay taxes on those sales. Stamp little feet and threaten to take their ball and go home, or to go complain to their mommies.
Appeal or not, the writing is on the wall, Ireland and it's theft of revenue from other countries, crippling their social services is over and Ireland will be fucked and forced to ensure all companies pay equal fucking taxes. No fucking special deal to steal other countries revenues, there should be far greater penalties applied to Ireland for this blatant scam and the economic attack on other countries.
All taxes should be paid where the revenue is generated, and not one cent of tax revenue should be allowed to be stolen by other countries. The Irish government are scum for doing this and should be made to economically suffer.
Chaos - everything, everywhere, everywhen
Its also about what would happen to you, the private citizen if you pulled this shit. HUGE penalties on top of what was owed and decades in jail in most countries....
Really? Private citizens would get in trouble if their government gave them tax breaks? Ireland and Apple entered into a voluntary agreement whereby Apple would keep jobs in Ireland in exchange for more favorable tax treatment. If this violates EU regulations, then it is the Irish government, not Apple, that is in the wrong, and it is the Irish government which should pay the back taxes.
If I can be modded down for being a troll, can I be modded up for being an orc, or a balrog?