“The U.S. Treasury Department said Tuesday it was disappointed with the European Commission seeking to force Apple Inc. to repay tax breaks given by Ireland,” Greg Robb reports for MarketWatch.
A spokesperson for the department said… “We believe that retroactive tax assessments by the Commission are unfair, contrary to well-established legal principles and call into question the tax rules of individual Member States,'” Robb reports. “The case could undermine ‘the important spirit of economic partnership between the U.S. and the EU,’ the spokesperson added.”
Robb reports, “Apple and Ireland both said they will appeal the ruling.”
Read more in the full article here.
MacDailyNews Take: Unfair, to say the least.
Anyone who decides to set up a business in a European Union member country today is insane.
Newsflash: Corporations don’t pay taxes, you do. “Corporate taxes” are simply passed along to the consumer. It’s how the government sneakily double-taxes its citizens. You’re taxed on your income and then again on what’s left via higher prices across the board. — MacDailyNews Take, December 4, 2015
SEE ALSO:
EU demands Apple pay massive $14.5 billion in taxes plus interest – August 30, 2016
Apple CFO Maestri: Despite EU tax ruling, we will continue to invest in Ireland – August 30, 2016
Apple CEO Cook blasts European Commission for ‘ignoring Ireland’s tax laws, upending the international tax system’ – August 30, 2016
European Commission to rule Ireland’s tax arrangement with Apple illegal – August 29, 2016
Ireland prepares for a fight with EU over Apple tax clawback – August 29, 2016
U.S. government warns EU: Do not hit Apple with a massive back tax bill – or else – August 25, 2016
European Commission denies anti-U.S. bias after U.S. Treasury intervention over Apple, Amazon tax probes – August 25, 2016
Time to shift its business over to Scotland. Lol
Seems like the likelihood of tax holidays for US companies will be high, after the election!
EU is afraid. Billions of dollars will be drained from the continent and will have negative effects on the economy and the Euro dollars.
The demand set the stage for negotiations, unfortunately for Apple, they are the “hostage”.
This is illegal for the EU to back tax Apple. The EU is high Unemployment rate: 9.6% (Apr 2015) Eurostat
Government debt: 87.4% of GDP (2013) Eurostat
it needs money, so it finds away to make money before the tax holidays for US companies. Irish government needs to speak up and defense for Apple.
Double taxed? We don’t already pay federal and state and sales tax and social security and Medicaid? Sounds like a fifth tax to me.
Don’t forget property taxes too! Since when you pay for the property you’ve already been taxed 6 times anyway.
Wow!!! When the US Government says that a tax is unfair, you know something is stinky. This is the epitome of the pot calling the kettle black. Just a tad two-faced.
If Apple repatriates the money from overseas, Apple gets to write off whatever they did pay in taxes over seas from whatever they would normally owe the US for that amount. So the US doesn’t want the EU to take 14 billion that the US will have to let Apple write off.
And the IRS et al don’t impose penalties as well as demanding the payments due when they catch tax cheats ?
U.S. Treasury’s POV: “Yeah, only the U.S. Government can force U.S. companies to pay unfairly high taxes. Who the hell does the E.U. think they are?”
No because the DOJ and justice idiots like those two so called lady judges want the money for themselves. lol
Lets get some facts straight.
Ireland has the right to set its tax rate.
That tax rate must apply to everyone.
Favourable tax rates for one company but not its competitors are illegal subsidies.
Exceptions (like limited rates for establishment costs) can be agreed upon.
HOWEVER
Apple pays a tax rate of just 0.005%! Starbucks, Google, Amazon, Facebook et al did the same, thereby having a HUGE competitive advantage, growing rapidly and earning billions.
Just for comparison: you earn over €53,000, you pay the top tax rate of 43%.
A close look will need to be thrown at Ireland’s involvement here. It us hard to understand how any Irish politician concerned for the health, education and infrastructure of his country would accept a 0.005% tax rate. So something clearly stinks here, and while Apple might have followed the letter of the law, they knowingly and willingly broke the spirit of the law.
Indeed, Ireland (and other tax havens) enabled bad behavior that undermines fair markets.
Bloomberg has some good data here:
http://www.bloomberg.com/news/articles/2016-08-30/apple-s-14-5-billion-eu-tax-ruling-what-you-need-to-know
I still don’t understand this:
1. They call this a “common market” yet each country sets their own tax rates for businesses? That is literally the dumbest thing I’ve ever heard. Shouldn’t the tax rates be the exact same for any business operating anywhere in the EU?
2. Apple has had this sweetheart deal SINCE 1991! And the EU couldn’t figure it out for 25 years?!
Competition is always a good thing. Including tax competition.
That’s the whole point – The EU east even around 25yrs ago, it was called the EEC (European economic community) which was purely to help trade between eurprian nations.
Why is the US sticking their nose into the EU’s business on this? Apple was taxed on an IRISH company, not an American Company. Apple set up that subsidiary to avoid US taxes. The only reason I’d think the US would speak up is because the US wants a piece of that money if/when Apple repatriates the money to the parent company. But the only way they’ll do that is if the US gives them a huge deal to avoid taxation.
No, false. Apple pays taxes in the United States because it is headquartered here. Check its annual financial statements. You will find that Apple pays taxes on its world wide profits here, deducting what taxes it pays elsewhere, which is what our tax code allows. The latest taxable year, Apple’s effective tax rate, which they have paid, was 25.28% of their profits. Alphabet/Google’s was ~18%. Because Microsoft took a huge write-off in the last quarter of 2015, they booked a 34% effective tax rate that quarter, but historically they pay about 20%.
The EU wants to be able to tax these multinationals in the EU instead of there home countries, upsetting the entire worldwide rules of where companies are normally taxed. The US could then tax Volkswagen for all of the profits they make selling cars in the US here, instead of Germany taxing them. . . similarly the US could tax all of the sales of everything that General Electric makes because it is now owned in France and France would no longer garner those income taxes. Oops. That upsets the entire balance of corporate income taxes that has been established for the last two centuries or so. . . because this out-of-control independent socialist EU commission made up of appointed bureaucrats wants to change it.
By the way, the original treaties that created the EU permitted the member countries to retain their own taxation codes and autonomy. This commission is attempting to use a statutory regulation about “state aid” to businesses and their interpretation of that regulation to retroactively alter individual countries’ tax codes and break that autonomy. Clearly that is something beyond the authority of a commission. . . but they are doing it. Over reach is what bureaucrats do until they are slapped down.
Brussels is digging it’s own grave. When Italy finishes swirling the bowl there will be nobody but the Bundesbank to pay the bills. I am scared of the idea of economically crushed Germans. That has never led to anything good.