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Apple Files 14-Point Appeal Against European Commission's $14 Billion Tax Edict (appleinsider.com)
An anonymous reader shares an AppleInsider report: Apple has filed its appeal with the European court of appeals, all declaring that the European Commission's decision to levy $14 billion in taxes on Apple on behalf of the EU is erroneous, against the rule of law, and should be stricken. The 14 points of appeal introduced by Apple on Monday challenge the European Commission (EC) on several fronts. Primarily, Apple contests that the Cork, Ireland, headquarters of Apple's European wing was properly set up, in accordance with all regulations and laws. Additionally, other apparent accounting blunders by the EC while making its decision were brought up as well. Apple points out that the taxable income attributed to the Ireland branch was misapplied, giving more weight to the Irish operation than it should, and that back taxes were being applied to worldwide profits.
1. Apple pays the taxes and admits no wrongdoing, quietly sweeping this incident under the rug and hoping to never have to endure it again by greasing more than just irish hands
2. Ireland admits it illegally undertaxed apple and skirted EU tax laws, thus opening up cause for additional investigation of facebook, google, and other megacorps that conveniently headquartered in Ireland because of, er, the weather.
Good people go to bed earlier.
You think seven billion dollars is enough to persuade Ireland to leave the EU?
You are delusional. Even the full 14 wouldn't be a tiny part of it.
Ireland needs EU membership more than almost any other EU state. And that's before you take into account its tax shelter gains.
Unfortunately, this story is about much more than just Apple and/or Ireland.
The tax practices employed by Apple (and others, including Microsoft, Amazon, Facebook, Starbucks and others - and I don't mean to pick on US companies, but by and large they do appear to be the most flagrant abusers of this system) use tax "vehicles" such as the licensing of intellectual property rights to move exceptionally large amounts of cash from one country [tax jurisdiction] to another, thereby massively reducing their tax burden.
However, for the "donor" country - i.e. the one that is not collecting any tax revenues from the sales achieved by that company, the problem gets much, much worse. The literally billions in taxes not being paid to these countries still has to be collected from somewhere. And that is exactly what happens - the individual, personal tax payers of those nations end up footing the bill.
Next, it gets worse still...
The governments of countries with "higher" Corporation Tax regimes then get visits from senior management from these large multinationals, explaining that of course they would like to "do more business" [and thus pay more tax] in those nations. Except, of course, the tax levels are just, simply, too painfully high. So, regrettably, the company will move its regional offices next door, to a lower tax regime.
The net result of all this is that countries the world over appear to be in a "race to the bottom" because they are told that this is the only way to attract inward investment. This is simply not true.
If we take a country such as the UK, for example [currently embarking on an acrimonious but necessary divorce from the EU... and look at the tax-paying population and the amount of tax involved... the literally billions in revenue that is transferred off-shore to avoid the payment of UK Corporation tax would, if actually paid in the UK, cut taxes for UK citizens by a staggering amount. The basic rate of personal Income Tax could easily fall from the current 23% to 15% [still more than Corporation Tax in the UK - and never mind the fact that companies get to deduct their expenses first...]
A population granted this extra income would:-
1. Spend more - thus helping to keep the economy moving
2. Save more - thus helping to reduce the burden on the state for things like pensions
3. Invest more - thus helping UK business to grow and prosper
There are countless studies showing that a better standard of living leads to a healthier population. In fact, there are no good reasons for allowing companies to "dodge" paying taxes in the way that is currently allowed [unless, of course, you happen to be a senior manager or shareholder in that company, in which case you stand to reap obscene profits].
The fact that we're even having this discussion should tell you just how corrupt and perverted the system of international taxation has become. The sad part is, that 99% of us are losers in this game...
If demanding taxes to be paid is "stealing", then what do you call it when somebody uses resources they aren't paying for? You know, if a person feels entitled to exploit the generosity of others and gives nothing back, we call him a parasite and suspect him of being a psychopath, so what kind of person is Apple? And if Ireland gives unreasonable tax benefits to certain, big corporations, does that not skew the market that is the very foundation of the EU (and which, incidentally, is the reason why Ireland wants to be a member)?
I have a good deal of respect for people who honestly believe in freedom and free market capitalism (even if I don't agree), but what you are talking about is just nonsense. The free market only stays free in any meaningful sense, if everybody genuinely agrees to follow the same rules, and that includes taxation and competition.
The EU doesn't want those taxes, they want Ireland to collect them according to their tax schedule in order to create a level playing field in the EU. What local business wouldn't love a 0.005% effective corporate tax rate? Most pay 20-25%
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...