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Apple Appeals EU Tax Ruling, Says It Was a 'Convenient Target' (reuters.com)
Apple has launched a legal challenge to a record $14 billion EU tax demand, arguing that EU regulators ignored tax experts and corporate law and deliberately picked a method to maximize the penalty, senior executives said. From a report on Reuters: Apple's combative stand underlines its anger with the European Commission, which said on Aug. 30 the company's Irish tax deal was illegal state aid and ordered it to repay up to 13 billion euros ($13.8 billion) to Ireland, where Apple has its European headquarters. European Competition Commissioner Margrethe Vestager, a former Danish economy minister, said Apple's Irish tax bill implied a tax rate of 0.005 percent in 2014. General Counsel Bruce Sewell and Chief Financial Officer Luca Maestri outlined in an interview with Reuters at Apple's global headquarters in Cupertino the company's plans for its appeal against the Commission's ruling at Europe's second highest court. The iPhone and iPad maker was singled out because of its success, Sewell said. "Apple is not an outlier in any sense that matters to the law. Apple is a convenient target because it generates lots of headlines. It allows the commissioner to become Dane of the year for 2016," he said, referring to the title accorded to Vestager by Danish newspaper Berlingske last month.
They had to start somewhere, right Luca?
It might as well be one of the worst offenders, ie. You.
No sig today...
The issue is not that they're successful, but that they were breaking the law. Sure, the amount due may have been less had they been less successful, but it would not have changed anything about the legality of their construct.
Maybe at the end of this the lesson here for Apple, Google, ... et al is that you should not piss off large blocks of nation states because they are bigger than you and not only do they have more lawyers than you, they make the laws. It must be surreal for a soulless megacorp to finally find out what it is like for a regular citizen when he/she gets bullied in court by somebody way bigger than them.
No rules where changed retroactively - they were in place when Apple and the Irish government decided the rules did not apply to them and those rules continued to apply ever since. Irish tax law does not trump EU directives agreed to by the government of Ireland and US tax law is utterly irrelevant to the tax obligations of an Irish company.
Every dollar or euro Apple doesn't pay has to be paid by somebody else.
Time is what keeps everything from happening all at once.
While it might be unwanted on the moral/ethical compass, tax evasion is not illegal.
It is illegal. That is what defines tax evasion. When legal means are used to avoid paying tax, it is called tax avoidance.
Apple played by the rules, and the Irish government agreed on it
That does not make it legal. By making this arrangement with Apple, the Irish government violated EU directives it had previously agreed upon.
The EU desperately needs more cash, so they try all sorts of things, including these tricks
Enforcing the law in this case will not result in a single cent going to the EU. They are forcing the government of Ireland to collect the taxes Ireland is owed. Moreover, I don't think the EU is desperately in need of cash. I don't know where you get that idea from. The EU budget has been more or less stable for a long time.
This is a sign that the EU is cracking up.
This is a sign that you don't know what you are talking about.
"because it disregarded tax experts brought in by Irish authorities."
Because your experts aren't biased *eye roll*
"The low rate is achieved by Apple telling U.S. tax authorities that the profits are earned by Irish units. Meanwhile it tells Ireland the profits are not earned in Ireland. "
"Sewell said the fact that an entity was a holding company with no employees on its books did not mean it was inactive and it could be actively managed by employees of its parent company." http://www.reuters.com/article...
Wow just wow. I guess Apple learned at the knees of Goldman Sachs. Pay your fucking taxes hippie!
Irish and US tax law are in this case both superseded by EU tax law in this case. So that argument is completely irrelevant in this case.
Remember by becoming a member of the EU the Irish agreed that their tax laws would be compliant with EU law. The commission found that Irish tax law was not compliant with EU law and as EU law is supreme Apple and Ireland are in trouble.
Sorry Apple cry me a river that you can't afford decent tax lawyers.
They will because once all this is settled and the Irish government has actually collected the back taxes, the EU will promptly fine the Irish government for breaking EU state aid rules, aka special tax breaks are state aid and that is not allowed under the EU rules (this is ruling Apple and Ireland have lost on) and fine them somewhere near the amount of illegal state aid that Ireland gave to Apple in the way of a special tax deal.
WRONG, WRONG, and WRONG again.
I will point you to the following article on the supremacy of EU law over national law.
https://en.wikipedia.org/wiki/...
I will then point you to the third amendment of the Irish constitution, which enshrined this primacy of EU law into the Irish constitution.
https://en.wikipedia.org/wiki/...
The EU has *VERY* strong rules on state aid. The Irish government gave Apple a special tax deal, that was not available to everyone. This has been found to break those state aid rules and is therefore illegal under EU law and as EU law has primacy over Irish law as confirmed by the third amendment to the Irish constitution then it is illegal.
It is amazing the crap people spout about this sort of stuff without the first clue as to what they are talking about.
Arguing that one should not be singled out for misconduct on the premise that everyone else is doing it is ultimately still an admission of guilt.
File under 'M' for 'Manic ranting'
...apples have alway been a convenient target.
the EU will promptly fine the Irish government for breaking EU state aid rules
Under what mandate, exactly?
I don't think you understand how the EU works. It works on a budget and is a political union that comprises 28 countries. The countries can use EU to pass laws that apply to all countries, but EU itself holds no power - the power comes from the member nations.
It's primarily a legislative body, not an executive one.
Ireland is a net recipient of funds channeled through EU, so it's possible (although not plausible) that a country could sue to get a larger piece of the cake based on Ireland not needing it with the extra tax money. But I find that highly unlikely. Apple would be long gone by the time allocation changes could be passed.
Eh... Are you seriously equivocating Apple, a multibillion dollar global megacorp with 'liberal do gooders'? Really? Yeah I get it, plenty of liberals use Apple products, but I've never seen people - on the right or on the left - claim that Apple as a company is in any sense liberal. Their tax-evasion as well as lack of any charity work whatsoever are quite well known, so I don't know where this notion of Apple as a 'liberal' company is coming from.
If anything, stories like this further go on to prove that Apple is just as unethical and uncaring as most other companies of their size.
"It is the business of the future to be dangerous" -Alfred North Whitehead
That's simply false, taxation across the EU is not set by the EU and corporate tax rates are not level across the EU or even within each nation state.
Corporate tax rate:
Austria 25%
Belgium 34%
Czech 19%
France 33% (36.6% above 3.5 million euros)
Germany 30.175% to 33.325%
etc. etc.
The rates are not required to be level across the EU, and they are not level even within each nation state. Taxation simply isn't within the EU remit, and your broad "no financial advantage" has no legal basis.
Apple does not receive state aid from Ireland and taxation is not within EU remit. The nations have not agreed to harmonize it, and so EU Commission has no such power.
What they're doing here is trying to pretend that can legislate tax laws based on the free trade and competiton directives.
Ireland agreed to abide by the EU's rules as a condition for joining. One of those rules is an exceptionally clear one about state aid. Quoth the EU:
State aid is defined as an advantage in any form whatsoever conferred on a selective basis to undertakings by national public authorities
Now, Ireland's free to set a 0.0005% tax rate or whatever it is they do, but they're not free to give one company an advantage over the others. I cannot see any vaguely reasonable argument that selective tax rates are not a breach of state aid rules. Note that there's no exemption for taxation in that rule.
Don't like it? Well, Ireand's free to leave the club because they're a sovereign nation and then they can give state aid of whatever amount they loke to whomsoever they like.
SJW n. One who posts facts.
To point 1: Have you even read a single history book on Europe? The current post-war period is probably the longest stretch of general peace Western and Central Europe has ever had.
To point 2: How is a common market and currency contributing to cultural homogeneity? Is the US homogeneous? Is China? Is Canada?
To point 3: The population of the EU is over 500 million people. Why does 200,000 employees seem so outrageous?
To point 4: There are a common set of rules governing the Common Market.This adds a layer, but the benefits of companies being able to trade on that open market largely unimpeded by tariffs and other trade restrictions more than make up for extra regulation.
To point 5: The European Union is a creature of treaty, a multilateral treaty between all its member states. It isn't a national government, so trying to compare it to one is absurd.
The world's burning. Moped Jesus spotted on I50. Details at 11.
Yes, the outcome was pre-determined, because Ireland was violating the terms of its membership in the Common Market. This is like a thief caught red handed bemoaning the fact that the "fix was in".
The world's burning. Moped Jesus spotted on I50. Details at 11.
Who said the EU raises taxes? The EU, as the inheritor of the European common market, sets the general rules about how taxes will be applied. It has to, because otherwise you would get exactly what happened with Apple; find a friendly EU country that will give you an absurdly low tax rate, but then enjoy unimpeded access to the rest of the Common Market.
Do you even understand what the European Union or the European common market is?
The world's burning. Moped Jesus spotted on I50. Details at 11.
The EU has just recently decided to reinterpret their laws to ban the rules Ireland has had in place for 25 years, and then do so retroactively to arrive at $14B.
I'm fully in favor of the EU shutting down this obvious tax shelter scheme, but: (a) society can't function if laws are reinterpreted retroactively, and (b) it's fundamentally uncompetitive to apply this revised reinterpretation to Apple alone.
I would say yes, that within economic integration, there would have inevitably been a slow march towards renewed conflict. The Germans and French, through the various iterations from the collapse of the Carolingian Empire as a unified political entity, have spent centuries at each others' throats. Economic integration between Germany, France and the Low Countries has been absolutely critical to this extended period of peace.
NATO's role has been unifying as well, but by and large its purpose has always been to prevent Russian invasion of Western (and now large portions of Central and Eastern Europe).
Economic integration was seen as critical by both the pre-eminent European powers and by the US as a means of making another general conflict impossible. Even Winston Churchill fully believed that economic and partial political integration were necessary to prevent another general European war:
Churchill - 1947
The world's burning. Moped Jesus spotted on I50. Details at 11.
tax evasion is not illegal
<pedantic mode=on>Actually, it's tax avoidance that is legal. Not evasion.</pedantic>
The EU desperately needs more cash
Which is funny because they claim that Ireland should be collecting this tax. None will be going to the EU. If the Irish want, they could take it and grant a one time payout to every Irish citizen. And then they'd be right back where they are today.
Have gnu, will travel.
It doesn't matter whether the people running it claim to be conservative or liberal, if they're running the company against liberal positions (tax-evasion and shitty treatment of employees for example) then they - and hence the company itself - are not liberal.
"It is the business of the future to be dangerous" -Alfred North Whitehead
The EU didn't impose a punishment on Apple, they imposed one on Ireland. The EU basically calculated what the tax bill should have been if all Irish corporate tax rules had been applied the same as they would to any other company in Ireland and told Ireland they had to charge Apple the difference.
I only please one person per day. Today is not your day. Tomorrow isn't looking good either. - Scott Adams