“Ireland’s cabinet could not agree on Wednesday whether to fight a European Commission ruling against Dublin’s tax dealings with Apple, raising questions over any appeal and the government’s stability,” Padraic Halpin and Conor Humphries report for Reuters.
“Finance Minister Michael Noonan has insisted Dublin would appeal any adverse ruling ever since the EU investigation began in 2014. But after over five hours of discussion, the cabinet adjourned until Friday when the government said a decision would be made,” Halpin and Humphries report. “Dublin has just over two months at the latest to make an appeal against the Commission’s ruling that the U.S. tech giant should hand over to Ireland unpaid taxes of up to 13 billion euros ($14.5 billion) ruled to be illegal state aid.”
“Apple, one of many major multinationals whose European headquarters are based in Ireland, has said it will appeal the decision and a failure by the Irish government to join them could undermine the country’s pro-business credentials. Noonan said on Tuesday he ‘disagreed profoundly'” with what he called a bizarre order from the Commission,” Halpin and Humphries report. “At stake for Ireland is the lure of its low corporate tax rate, a cornerstone of economic policy for decades that has drawn investors from large multinational companies whose staff account for almost one in 10 of the country’s workers.”
Read more in the full article here.
MacDailyNews Take: It’s a no-brainer for Ireland to join Apple in the appeal.
By policy recommendation, any clawbacks should go directly to pay off Ireland’s debt. Apple’s €13 billion would be a drop in the ocean of roughly €200 billion debt. The idea of pissing off one of your best and growing employers while conceding to be led around by the nose by a feckless Brussels kleptocracy in exchange for a meaningless drop in the ocean isn’t smart, it’s stupid.
Apple is Ireland’s 34th largest employer. How much tax revenue (income and health (USC), capital gains, sales, property, vehicle registration, plastic bag, etc., etc., etc.) and economic activity (sales of gas, housing, utilities, investment, food, BEER, etc.) do Apple’s upwards of 6,000 employees generate for Ireland annually?
SEE ALSO:
Apple: The European Union’s pointless tax crusade – August 31, 2016
Irish cabinet may be given more time to decide on Apple tax appeal – August 31, 2016
Post-Brexit Britain could benefit greatly from EU’s tax attack on Apple and Ireland – August 31, 2016
Ryanair CEO Michael O’Leary on Apple tax row: Irish government should tell EU to f**k off – August 31, 2016
U.S. taxpayers could end up paying Apple’s bill for back taxes in Ireland – August 30, 2016
Morningstar: Apple remains fundamentally undervalued after EU tax grab – August 30, 2016
Obama admin worries EU’s Apple decision will cost U.S. taxpayers; Bernie Sanders applauds EU tax demand – August 30, 2016
Ireland doesn’t want Apple’s $14.5 billion in so-called back taxes – August 30, 2016
U.S. Treasury: The European Commission’s retroactive tax demands on Apple are unfair – August 30, 2016
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
MDN are idiots.
Apple (and other big corporations) pay a tax rate of 0.005%. Something is VERY wrong here, the EU had a close look, and found that rules had indeed be broken (Apple can be happy that no punitive damages have been sought).
But then Americans are used to that. They are incredibly naive and think that if you work hard and have no major accidents then you’ll get rich too. I’m fine with someone getting rich. But the simple fact is that over the last 30 years the rich got MUCH richer and the rest poorer because the rich don’t pay their taxes. I still shake my head in disbelieve that Bush convinced the Americans that a tax cut for the rich was a good idea. They must still be laughing their asses off on that one. Do the Americans realize that they subsidize the rich?
That’s also why Trump hasn’t shown his tax returns. For example he classified his golf courses as farm land and is even cashing in on subsidies intended for struggling farmers. But hey, a lot of people are stupid and think that’s ok. And if the State comes and looks at that and says “Hey, one moment: that’s not ok, and you have to pay back the subsidies and the tax you own.”, then according to the majority here the State should eff off.
Idiots.
Really.
Greed, betrayel, and the American way.
Prove your statements or STFU, imbecile.
@The Truth: You massively over-simplify a very complex situation and set of international tax laws and rules, and then try to confuse it by bringing in personal tax issues. Yes, the rich have gotten richer compared with the poor. And middle class is being squeezed out of existence. And yes, the international tax situation is f*cked up and should be simplified and clarified. But Ireland has for decades offered itself as a low-tax base for multi-national businesses, and that was the cornerstone of its economic recovery and strength. The much ballyhooed “0.005%” is just FUD that you’ve swallowed hook, line and sinker. That’s the amount of tax Apple paid to Ireland based on its worldwide profits – an amount Ireland is very happy with. Apple also pays corporate taxes in every country it does business in.
The EU had a close look, as you say, but had to invent new rules and apply them retrospectively in order to tag Apple (and, no doubt others in the future). The deals Ireland made with Apple (and others) were totally legal under Irish law. If the EU was so sure these deals were against the rules, why did it wait 36 years to investigate? And how the heck do YOU know that Apple is very lucky that no punitive damages were sought? Even Ireland says Apple broke no laws, let alone broke laws with the egregious mindset required to impose punitive damages?
You’re simply showing your ignorance, I’m afraid.
Any time anyone labels anything as ‘the truth’, I know they’re full of excrement. Calling a general group of people ‘idiots’ indicates similar waste.
BUT I really like a lot of what you’re pointing out in your statement, except with regards to taxation of foreign profits made by US companies. Perhaps this is too complicated a subject for some. But #MyStupidGovernment (the USA) has literally forced companies to NOT return their foreign made profits into the USA thanks to exorbitant tax charges. With that being the case, a country like Ireland is smart and benefits from providing a legal and beneficial tax haven for US companies, such as Apple.
The EU’s charges, as Road Warrior and I were discussing here, consist largely of conjecture and an attempt at overruling the sovereignty of Ireland. As such, they (A) Have wasted a lot of the EU’s money on what may be nothing, (B) Are going to further waste the EU’s money on resulting appeals, (C) Will get nothing at all back in return for any of this, no matter how the appeal is settled, (D) Are ticking off EU member countries through their demonstration of OVER REACH, dictating what must be law in EU member countries.
It’s a ridiculous mess with nothing better than a ridiculous ending yet to come. If only governments fulfilled their roles of BENEFITTING their constituents instead of screwing them over in pursuit of THIS ‘truth’ or THAT ‘truth’ or THE OTHER ‘truth’, all abstract and none universal.
to answer MDN question.. 6000 job with all the taxes etc don’t account for even 100 mil a year. to get to 13billion..many years would have to pass. This is a very easy calculation that Ireland made a bad deal. If it’s even illegal that’s on top.
Your math needs work. Say 80% of those 6,000 employees are married. That’s 4,000 HOUSEHOLDS, plus the other 2,000 singles. Say 50% of the couples have children. These are HIGH-PAYING jobs, not crap jobs.
Now calculate the economic activity those 6,000 jobs and their attendant households generate in real estate (home sales, rentals), groceries, automobile sales, boat sales, restaurants, etc. It’s much, much more than you think.
Take away those 6,000 HIGH-PAYING Apple jobs from Cork and watch the place begin to whither immediately.
google it up.. not too hard.. these are 25-40k EUR jobs in Ireland. so, not high paying jobs. All I’m saying is that Ireland didn’t get a good deal.
Apple is in position of power to strong-arm countries, but they do it with their suppliers as well into deals which are not good for them.
So in that equation surely 13 billion of saved taxes is much more than the crumbs of few thousand low level jobs which in total don’t yield more then a billion over 10 years ( crunch the numbers you’ll see)
As far as your last point. true, take away water and we all die.
Would you do that to save 10 billion dollars? Where does profit requirements take a back seat to fairness?
… how many stadiums in the US of A were built with tax breaks and city/state money? And Ball Fields, Tennis Parks, bla, blah? G.E. is building a new HQ in Boston with some “civic concessions” as we … write. This is Business As Usual in America. As TheTruth said, corporations pay little taxes and often get more back than they pay in. Did you know that the fossil fuel industry gets yearly pay-outs from their “taxes”?
Do you know what corporations pay taxes on? What they don’t spend out of their earnings! If they by their CEO a new limo, they don’t pay taxes on the monies used to buy the car!
As for the retro-active part of the “judgment”? Beyond the time the action was filed, it can be hard to justify. After that? Yeah … Apple should have been setting aside money to cover that. So … maybe $2 Billion? That will help Ireland and its debt. Not a whole lot, but some. And Apple can easily afford it.
Good question, MDN..
If each of the 6000 workers earned the equivalent of US$100,000 per year, that would total US$600M per year. So the EU fine represents about 24 years of the entire Apple salary base in Ireland under those assumptions. But that is an overly simplified calculation with little value.
In economics, you need to factor in the multiplier effect — money I earn is spent on products and services that pay salaries for others, and so on. Considering the multiplier effect, Apple’s long term value to Ireland in creating and maintaining quality jobs is undoubtedly far more valuable than a one-time tax event.
When you consider the other major companies that are in line to be impacted by the EU decision (should it stand against appeal), then Ireland has to worry about the potential for destabilizing their economy and entering a downward spiral of layoffs and unemployment.
Should Apple pay more taxes? Perhaps. If so, change the tax laws. Or, perhaps, we should consider a different approach to collecting taxes — collect from the people including income from investments. Most businesses are relying upon lawyers and accountants to help them minimize taxes anyway, and the issue has become more complex with the growth of multinational corporations. So we should just simplify the situation and stop chasing the corporations.