Apple May Bring Back Billions In Profits To The U.S. (siliconbeat.com)

An anonymous Slashdot reader quotes a report from the San Jose Mercury News: Apple CEO Tim Cook says the company plans to bring back billions of dollars in profit to the U.S. next year. Cook's statement, made during an interview with RTE radio Thursday, contradicts his previous public statements on the issue: He has said for years that U.S. corporate taxes are too high, and that the Silicon Valley company wouldn't be repatriating profit until its home country changed its tax code.

"Right now I would forecast that we repatriate next year"Cook said, saying that the company has "provisioned several billion" for that purpose.
An interesting side-note: Apple accounts for 40% of Silicon Valley's profits.

Comments

Empty threat

[Anonymous Coward]

Apple just wants to scare the EU, there are plenty of other countries they will hold their money that won't charge as much as the US will.

Re:Empty threat

[Anonymous Coward]

Ireland attracts companies because of their favorable tax rates.

Calling 0.005% tax on global profits (yes, really, not a typo) favorable tax rates is at least an euphemism

did not violate any EU laws.

They argue it that does violate preexisting EU conditions and that is indeed ilegal.

It's amazing the morons in EU\EC think they can harass US companies and not evoke a response from the US.

Roger. We get it.

Re:Empty threat

[jopsen]

It's amazing the morons in EU\EC think they can harass US companies and not evoke a response from the US.

Oh, cry me a river... There are courts in the EU, you are more likely to see your rights honor there than in the US, a country known to deny effective council, torture people and lock up people without trial.

When you workaround taxes in both the EU and US, I for one encourage Vestager to throw the book at you. Really, when a company like Apple decides to test boundaries of the law, Apple should expect the authorities to do exactly the same.

On topic, I'm sure the US generally likes this because without this pressure the money would have stayed in tax shelters. I for one think it's okay to go after companies that are actively speculating against the state, in hope of better future tax breaks...

Re:Empty threat

[EvilAlphonso]

Ireland attracts companies because of their favorable tax rates. That was not a secret and did not violate any EU laws.

Ireland's corporate tax rate is 12.5%, the second lowest in the world. The EU doesn't have any issue with that rate. What Apple negotiated was an effective 0.005% tax rate instead of the 12.5% rate. Notice that the number is different. What the EU is asking is that Apple pays the 12.5% tax rate as the 0.005% tax rate has been ruled a state subsidy. State subsidies were made illegal inside the EEC (now EU) by the treaty of Rome in 1958. So yes, it does violate a EU law... one of the founding laws of the EU common market.

It will be cheaper to pay US taxes than worry about the EU\EC passing retroactive tax laws and other fines or penalties.

Because it is well known that paying 35% is cheaper than paying 12.5%, which is the tax rate Apple is being asked to pay. Ireland is bound by the treaty of Rome since they joined the EEC in 1973. Apple opened its Irish operations in Ireland after Ireland became a member of the EEC. This has nothing to do with retroactive tax laws, the deal Apple received from the Irish tax authority was illegal from day 1.

The EU is also only asking for the last 10 years of due taxes, instead of all taxes due since the beginning of Apple operations in Ireland.

If Apple doesn't want to pay its taxes in the EU, it is more than welcome to take its ball and GTFO. If Ireland doesn't want to play along with the rules of the EU market, they can also pay back the money they still owe the EU early and GTFO. They have effectively sold the rest of the EU market down the river. I'm sure international companies will still flock to their shores once Ireland is no longer a member of the EU market and the companies can no longer passport activities/taxes from there.

By the way, it is cute that you believe Apple will pay more taxes in the US. According to a senate inquiry in 2013, Apple is using a subsidiary that effectively pays no tax whatsoever in any jurisdiction to shelter a good quarter of its assets. According to the same senate inquiry in 2013, Apple has been funneling money to the Irish operations in order to avoid paying $11bn in taxes a year between 2009 and 2013. Apple is also apparently misreporting to its shareholder the amount of taxes it pays in the US... what they tell their investors is twice the amount that the IRS can account for.

It's amazing the morons in EU\EC think they can harass US companies and not evoke a response from the US.

It's amazing that the morons in global companies think that they are not bound to the laws of the places where they operate. It's equally funny that you still consider Apple an US company when it's currently not producing in the US, has more than twice the assets outside the US than it has in it and its best innovations lately are in the field of tax avoidance. Also, out of curiosity, can you name the last two companies with record fines from the EU for the same type of deal?

Re:Empty threat

[bytesex]

Exactly. The EU's beef is primarily with Ireland, only secondarily with Apple. The thing is: Ireland is a net receiver of EU money. So the EU reasons: if you want subsidies, you have a certain obligation to pick up certain types of money, taxes being one of them. Otherwise it would create a perverse incentive to EU nations: don't collect taxes, let the rest of the EU countries pick up the bill. So the EU demands, in exchange for membership, a tax regime of a certain quality. Since they are the ones paying, they decide. Germany, for example, could decide not to tax Apple a penny, but it wouldn't get a similar frown from the EU, since it's a net payer into the system.

So the EU says to Ireland: collect, or we'll lower your subsidy by an equal amount. And Ireland finds itself caught between a rock and a hard place.

Re:How does it contradict?

[fluffernutter]

You talk like they actually pay that rate.

Re:He's just changing robbers.

[Anonymous Coward]

If you want to live in a civilised society, taxes are the price you pay.

Lower Corporate Tax Rate

[nehumanuscrede]

I would be all for lowering their taxes, on one condition.

American workers only within the US.

You want the tax breaks ? You quit going the H1B route cheating the US workforce out of a job.

You hire foreign labor ? Your tax rate will increase to compensate. Pretty simple. Do the math, set the rates to make hiring US workers a financial win for the company. Price of doing business in the US I'm afraid.

Don't like it ? Move your company to India or Ireland or wherever you want. See how well you do when you're denied access to the US market.

Those that are gaming the system can just gtfo or deal with the tax man.

Re:U.S. Corporations need to pay U.S. taxes.

[Rakshasa Taisab]

One of the most fucked up parts of being an U.S. citizen is that even if you work, live, breath on foreign soil you still need to report everything to the US tax office.

Basically the only country in the world that will keep fucking you over even after you try to leave it behind for ever. Glad I'm not a 'citizen'.

Re:Trump 2016!

[nospam007]

"Make America great again! Lower takes and make other countries pay for our walls!"

Since you obviously don't even know how 'taxes' is spelled it raises the question:

Is that you, Donald?

Re:rats fleeing the sinking ship

[nospam007]

"it means exactly as it was meant to mean. They made an illegal deal with the Irish government to act as a tax haven to shelter their earnings from other countries. You can call it profit shifting, tax minimisation or whatever the hell you want, but it has been declared illegal finally and I call it theft."

Not at all, it has been considered as an illegal subsidy/gift _from_ Ireland to Apple and the Irish are now 'forced' to ask for that 'gift' back, just like other countries before them.

Proit

[ledow]

It's easy to make more profit than your competitors when you're aren't paying any tax, in any country that you operate in.

Strangely bad for PR when it gets on the news, though. And strangely ends up changing from a hush-hush golf-and-a-posh-meal secret deal with the local ministers to laws being changed to prevent it happening when it does make the news.

Starbucks found that out in the UK.

So, technically, Apple don't make 40% of the profits in the Silicon Valley. Because those profits aren't properly taxed. And they aren't registered as profit in Silicon Valley at all. They are registered as profit only in Ireland. Which was charging them basically 0% tax. They are the LEAST profitable company in Silicon Valley, or else the US taxman would have had their share a long time ago.

But they are in fact the most profitable in Ireland, while also being the least taxed. Strange that.

I could earn twice what I do if I didn't have to pay tax.

And I could make any company outstrip all its competitors if it didn't have to pay tax (get company, make no changes, stop paying tax, bang, you just doubled your profit most likely, and can lower prices or buy suppliers to put your competitors out of the market).

I'm much more interested in an article entitled "Who pays the most tax in Silicon Valley?"

Re:I disagree with the term "back"

[dbIII]

Actually it was in the US.
Look up "transfer pricing".
It's where things happen like Apple USA buy an iPhone from Apple EIRE at very close to retail price and so on paper make almost zero profit in the USA.
The profit then happens in Ireland where the difference between say $10 per unit and $500 per unit is not taxed much at all due to personal agreements with Irish politicians and some other financial games involving Holland.


The EU is extremely pissed off because they have been propping up Ireland financially while Ireland has been looking the other way at vast amounts of tax revenue that Irish laws say they should be collecting. It's not about 6000 jobs (the usual excuse and most likely an outright lie about the number Apple employ in Ireland), the unpaid taxes could provide that a hundred times over, it would be a money trail leading into the pockets of those Irish politicians who are loudly damning the EU this week for suggesting they tax Apple.

Re:He's just changing robbers.

[Required Snark]

If you can't tell the difference between organized crime and a functioning democracy they you are deranged.

You want freedom from government interference? Move to Somalia, central Mexico dominated by drug cartels or Southeast Asia where they grow opium. No "oppressive" government there.

In contrast consider Norway. I've been there and it is one of the best run societies I have ever seen. Lot of government regulation and it always ranks near or at the top for overall quality of life.

Since things in the US suck so much because of the "ebil gumment" why don't you "self deport" and go to one of the Libertard havens that exist all over the world? Since all problems result from government interfering with your precious sovereign liberty, you should be about to create a paradise on earth anywhere there is no effective central control. Parts of North Africa are lawless right now, and with the recent death of Uzbekistan's dictator I bet you and your best Libertarian buds could go over their and create the perfect society.

Can you leave tomorrow? I'd be happy to drive you to the airport. Don't let the door hit your ass on the way out.