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Ireland Will Bring the Fight Over Apple Taxes To the EU Court (digitaltrends.com)
An anonymous reader quotes a report from Digital Trends: The tax debate between Apple, Ireland, and the European Union may escalate in the next few months. According to recent reports, the Irish Finance Minister, Michael Noonan, will bring the debate to the EU court, a move that could trigger a years-long court battle. The battle stems from a European Commission finding that Ireland had been giving Apple tax breaks, something that has attracted a number of multinational employers to Ireland. The EU, however, has ordered the practices to change. After a three-year probe into Ireland's relationship with Apple, the European Commission ordered Ireland to collect $14.5 billion in back taxes from the company. That is the largest state-aid payback demand in history. The decision has been the subject of criticism, particularly from this side of the Atlantic. The U.S. Treasury Department says the decision is a threat "to undermine foreign investment, the business climate in Europe, and the important spirit of economic partnership between the U.S. and the EU." Apple has also vowed to fight against the EU decision, and those appeals will follow the ones already pending in Luxembourg, where the EU is headquartered. Those pending appeals include cases against Starbucks.
No wonder all the shifty companies want to register in Ireland!
'this is a threat to the US collecting taxes on this revenue, it belongs to the US keep you're dirty hands off it!'
The EU is a commonwealth among nations. One deal is that members refrain from competing unfairly against each other. The EU actually enforces these deals. Who would have thought.
Basically the Irish Elites are the petty bourgeoisie of the globalist over-class. They provide Apple etc, with nigh 0% tax environment, and in return receive near San Francisco level salary levels in the city of Dublin, which by rights should have a wage level closer to Manchester.
This is about money, and the ruling class here will do anything to keep their hands on it. If Apple asked them to dig up Croke Park they'd probably do it.
Nations also sign treaties. Treaties usually result in laws being passed. Otherwise the other nations who sign the treaty just ignores you and kicks you out of the treaty.
One of the most fundamental concepts in civil law is contracts, and treaties are just contracts between nation states. Break any contract you sign in good faith and tell me how it goes.
When you're making a shady deal, make sure there is no higher authority than the person you're getting into bed with.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
With news like this, suddenly the Irish will be interested in their own Brexit.
No.. That would make them even more dirt poor than they already are from not collecting their taxes.
FTA:
No it's not. Try Brussels in Belgium.
Hope the court nails the sweetheart deal between Apple and the Irish taxman.
It hasn't just cost the Irish but every other consumer in the EU who has bought iCrap. All the profits go back to Ireland where they're essentially not taxed but squirrelled away by Apple. Apple stockholders win but EU citizens get screwed.
The Machine stops.
I'm in the EU, and I am against these tax deals or tax breaks for corporations as they do amount to unfair government subsidies and unfair competition amongst nations. With that said, I also believe that a country or its IRS should not be able to go back on a tax deal retroactively, not unless the entity with which the deal was made presented fraudulent information in order to get the deal. And a country should not be forced to go back on such a deal either. Apple worked within the law, got a favorable tax ruling, and should not be punished when the deal turns out to be invalid. Else, what are these tax rulings worth?
And before you say "we shouldn't have them at all", our IRS makes them all the time. As a freelancer working out of an Ltd, I got a tax ruling stating how much salary I should pay myself as a "director-major shareholder" (there's a minimum based on the kind of company and revenue). I would hate for them to come back to me and say "we were not allowed to fix your minimum salary at X, it is now X * 3 for the past 5 years and you owe us income tax and social security premiums over the difference."
Ireland should be punished, not Apple, and the EU is right to enforce these rules. How Ireland should be punished is left as an exercise for the reader...
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
You are a tax cheat
Funny (Score:-1, Insightful)
Yeah, that is funny...
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
That case generally does not present itself because the person telling you what to pay as salary knows the rules well, applies them with a narrow margin, and is trusted by his superiors. It is rare for these rulings to be overturned - though I assure you it does occasionally happen!
The case with Apple might be different. From what I remember(!) reading last time this was in the news, both the Apple lawyers as well as the Irish tax authority could be expected to know this deal was crossing the line, and proceeded anyway. (Like buying a cheap bike on the street...)
Ireland is well known for these sorts of practices (for example they also double tax dividends against EU regulations). They have been warned to behave before, so yes, they should be punished. As a willing participant, Apple should not go free either, though.
The back taxes are only back till the point where the investigation was lauched plus statute of limitations. If Apple failed to make contingencies in case they lost the case that would be stupid of them. Here in the UK Her Majesties Revenue and Customs can at any point decide to investigate you tax affairs going back 7 years and if you have not been doing it right demand the extra tax plus interest. Why you think Apple should be held to a different standard is beyond me.
Apple should be held to the same standards. The question is whether or not they have been "doing it wrong". And if you get a ruling from the tax office, it's not unreasonable to assume that everything is a-ok.
Collecting back taxes from the point where the investigation started sounds fair though, and I was not aware that this was the case.
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
The amount of money involved is far beyond anything a tax ruling could cover unless it was approved by the government (which means approved by the cabinet) and even then the Supreme Court could probably overturn it. Apple would likely have more lawyers and accountants then Ireland and just like me they would know this full well. They knew they got an insane and illegal deal and what is really stupid is that if they had done exactly what they did without asking for any ruling they wouldn't be in this situation now. The judgement is over them getting an agreement and hence it is deemed Ireland provided them an advantage by claiming to confirm the backdoor, something all the others availing of the same loopholes are simply doing based on their own legal advice (and presumably ready to pay whatever they are found liable for).
As a business owner I haven't paid myself a salary in years, I put everything back into business.
What do you use to pay for food and shelter then?
If God forks the Universe every time you roll a die, he'd better have a damned good memory.
...unelected bureaucrats...
I get tired of hearing this one.
Yes, they're unelected but they're appointed by their respective member states. If you have a problem with how your government's representative is acting, or with the laws they're drafting and voting up, then take it up with your own government because it's your own democratically elected government who put them there.
Take it up with your own EU commissioner too, because they're the ones who should be out in public promoting the ideals of the union - such as they are - and giving the people a little taste of the transparency and accountability they deserve. Whatever you do, though, never forget that they serve only at their political masters' pleasure; they're not faceless bureaucrats. If your politicians think there are votes to be won by appointing a different commissioner... then I'll be living in a fantasy world where every nation's problems are solved and people actually have time to care about European politics. As it is we can only hope that 28 people are both competent and have our best interests at heart.
...as it may set a major precedent regarding the sustainability of the EU.
Because, as we all should know by now, the crucial key to any long standing political enterprise is: who controls the MONEY.
Of course the corollary to money in a geopolitical context is...sovereignty.
Ireland, if it's actually a sovereign state, should be able to set its own tax policies. Now if it is in a voluntary agreement with the EU to deprecate it's otherwise-sovereign power for the good of the EU megastate, that's fine. But if it breaks the rules it agreed to, IT (and solely it) should be punished for that (ie paying a massive fine, whatever). How it then decides to recoup this penalty is up to it.
However, if the EU can say "Ireland, you broke the rules, you have to make THAT OTHER GUY PAY for your mistake" that essentially takes away any agency from the Irish government at all. They become little more than a tax-collection engine for Brussels.
I have to imagine that there remains some remaining sense of identity within European peoples, and that this - if the bureaucrats can't keep it carefully within the confines of the backroom - will spur a flare of quasi-nationalism that could shake the whole thing soundly.
Or, I'm totally wrong, millenial Euros are entirely adrift and amalgamated into the EU identity and things like "countries" in Europe will become little more than quaint names for administrative districts.
-Styopa
What do you use to pay for food and shelter then?
You obviously have no background in small business accounting.
He sleeps in his home office (which has a spare bed) and he eats at business meetings with his partner/spouse, and his contractors/children.
By that definition, Ireland is being an honest cop for Apple (and various other large corporate tax dodgers).
Why is Snark Required?
Except this investigation found it to be in breach of the law and since both parties were aware of this Apple can't claim to have acted in good faith. Which is why they can be made to repay it all...
The EU treaty says "don't give favourable deals" and Ireland did just that: How are they going to argue the treaty doesn't apply?
Because it wasn't an Apple-specific "favourable deal". It was a straight interpretation of the Irish tax laws, the Irish rules for company registration ,and the interaction between the tax laws of other EU jurisdictions. It was available to any other company, and indeed many other companies took advantage of it.
There were two specific issues that were troublesome - one was Irish the other was not. Neither involved the corporate tax rate.
The Irish loophole was allowing the Irish registration of non-resident companies, and that loophole is now closed since Jan 2015 (and existing companies formed under this law are being phased out by 2020).
The other loophole involved taxable income, where the Irish government only taxed revenue generated within Ireland, but had a heavy tax on transfers to tax havens, and the Dutch government didn't have the transfer tax. So the profits were booked in Ireland by an Irish registered company headquartered in a tax haven, then transferred to the Dutch company (very low tax, inter-EU transfer) then transferred to the tax haven, which the Dutch didn't tax as heavily as the Irish. The Dutch never closed this loophole, and aren't under pressure to do so.
This is a straight play by the Commission to bring their "tax harmonization" agenda back to the table, but is unlikely to happen until the EU takes one step further and straight up require the richer states to part-fund the smaller states. This will not happen until a Federal Europe happens - which at the moment looks like it will be the day after never but who the hell knows?
Rational thought is the only true freedom
In this case the EU bureaucrats and paper pushers are trying to re-interpret the existing rules covering this situation
You mean they're actually doing something in favour of the tax payer for once? Something that they should have done years ago.
and then apply penalties retroactively.
All penalties are retroactive. You don't get penalised for something you're yet to do.