“Ireland and Apple Inc. are close to a deal to protect the Irish government from any losses that could occur while it holds as much as 15 billion euros ($17.7 billion) of the IPhone maker’s money during a tax fight with European Union regulators, according to two people familiar with the matter,” Dara Doyle reports for Bloomberg.
“In an order that reverberated across the Atlantic, the European Commission last year slapped Apple with a multibillion-euro bill, saying Ireland granted unfair deals that reduced the company’s effective corporate tax rate,” Doyle reports. “Irish authorities will place the money in an escrow account pending an appeal.”
“If the appeal, which could take as long as five years, is successful, the money will be returned to Apple. Ireland wants to make sure it isn’t liable for any drop in the value of the fund while the case winds its way through the EU courts,” Doyle reports. “An agreement on the issue may come within weeks, said one of the people…”
Read more in the full article here.
MacDailyNews Take: The EU farce oozes along like molasses uphill.
SEE ALSO:
Ireland seeks custodian for Apple $15.2 billion in back taxes as collection nears – July 22, 2017
EU Commissioner Vestager: Ireland ‘taking too long’ to recover Apple tax – May 19, 2017
EU’s hypocritical Margrethe Vestager going after Apple while backing Madeira tax avoidance scheme – February 14, 2017
Apple has missed the deadline to pay $13.9 billion to Ireland in illegal tax benefits – January 31, 2017
Apple CFO Maestri: What the EC is doing here is a disgrace for European citizens, it should be ashamed’ – December 19, 2016
Apple’s EU tax nemesis Margrethe Vestager takes aim at other U.S. companies’ offshore profits – September 19, 2016
The ‘Brexit-Apple’ connection: What in the world was Margrethe Vestager thinking? – September 12, 2016
EU ministers line up to take tax bites out of Apple – September 12, 2016
Former EU competition commissioner: Vestager claim that Apple owes back taxes an incorrect use of EU law – September 2, 2016
Irish government to fight EU on Apple tax – September 2, 2016
Treasury accuses EU of trying to steal U.S. tax revenues with Apple decision – September 1, 2016
Irish residents opposed to EU’s tax demand of Apple – September 1, 2016
Apple Inc. pushes back against EU tax grab – September 1, 2016
Apple may repatriate billions of dollars next year after new U.S. President takes office – September 1, 2016
U.S. tax code allows for dramatic retaliation against EU overreach in Apple case – September 1, 2016
Apple CEO Tim Cook on EU tax demand: ‘No one did anything wrong here and Ireland is being picked on… It is total political crap’ – September 1, 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
U.S. government warns EU: Do not hit Apple with a massive back tax bill – or else – August 25, 2016
man, Merkel Inc sure wants that Apple dough..
Politicians = Leech
Leech = Politicians
Sounds like it’s time for an “Irexit”
Wow! Only a 2 Star average. How can anybody be against a country reclaiming it’s independence? The Liberal mind never ceases to amaze me.
Yeah. Perhaps Texas should seek its independence also.
California should go first.
Euros certainly don’t look good as a long-term investment.
The US has been taking every possible action to devalue the dollar. Near zero fed rate, quantitative easing, rewarding banks with bailouts. Now blowhard Trump declaring ‘Merika First, only bilateral trades negotiated with personal involvement of the Trump family
It is no wonder that since 2002 the Euro has been significantly higher valued than the US dollar. Even with the Brexit mess(which collapsed the inflated value of the Pound Sterling), the Euro remains one of the strongest currencies and will remain so as long as the trading partners retain open borders and common currency, which were key ingredients to making the USA an economic power from the moment the weak independent colonies got smart and banded together.
The EU punishes Apple for following the law. The lesson vis-avis Ireland is that Apple should have broken the law, becoming an outlaw, a gangster corporation, a pirate. Arrrr, arrrrrr!
Apple knowingly entered into a special tax arrangement that was not legal under EU rules. If Ireland wanted the benefits of membership, it should have played by the rules.
Those who want to live in the completely free states of Somolia or Botvinnikstan are free to go at any time. But as long as you use the benefits and services that a larger trading bloc offers (you take it for granted, but economic comparisons with the standard of living in small independent states are available if you are not too lazy to look it up), you might as well accept the membership fee.
Funny how you yanks live in the biggest federation on the planet, most of you by choice in highly regulated cities, in regulated flats or homeowner association neighborhoods with stupid rules, and that is all wonderful. Then you tell other nations they are doing it all wrong.
You may want to ask yourself why all major corporations including Apple are establishing tech centers all over the world. Not just production or sales offices, but IP generating design and research centers. If the EU taxed too much, then Apple would not have so many offices in mainland EU. In addition to tax haven Ireland, of course.
Realist,
You are trying to bring facts into a debate rooted in dogma, sort of like bringing a knife to a gunfight. These guys are convinced that the EU—indeed, the very concept of international cooperation—is evil and nothing you say is going to change their minds.
You do know, don’t you, that it doesn’t matter how many times we point out that this dispute is not grounded in greed? The EU (nor its member states, nor Angela Merkel individually) has no direct financial stake in the outcome of this particular case. It will not get the $17B if Apple loses—Ireland will, and it does not want the money! If all bureaucrats were really just motivated by greed, the sides would be reversed.
The income of the EU comes from sources that are not affected one way or the other by how this case comes out. The concern is whether an EU member complied with EU rules when it entered into a commercial agreement that looks, waddles, and quacks like either a duck or an improper subsidy by an EU member government to a particular company. The whole point of the EU is to foster cooperation and fair competition between the member states by providing a level playing surface with no home field advantage. This deal potentially violates that principle.
I hope that Apple wins its appeal. The argument can be made that the EU waited too long to complain and shouldn’t be able to enforce past obligations, as opposed to those going forward. Its response is that Ireland was on notice, since the rules were in place long before Ireland joined the Common Market (even before it became the EU).
Many Americans are used to a situation where states and cities are free to offer ridiculously massive government subsidies in order to attract businesses away from other places (see Foxconn and Wisconsin). The EU has prohibited that ever since its predecessor organizations were founded in the early 1950s. The European experience was that unbounded competition between nation-states ultimately led to armed conflict. That policy decision is theirs to make, not America’s.
Oddly, many of the same folks who support the right of Wisconsin and Ireland to offer massive government handouts to large corporations are the loudest about opposing government interference in free markets and government handouts to needy individuals.
In economics where market forces rule, Apple made no “special” arrangements with Ireland; It made a normal fiduciary arrangement with it. Had it made an arrangement with the EU, that would have been special, and it would have been irresponsible to its investors.
0.5 % effective tax rate for Apple after Apple created an office in Dublin. Did you get the same generous incentives?
The same tax rate was available to any business that located its European headquarters in Ireland. There was nothing “special” for Apple. The same deal was offered to other multi-nationals under Ireland tax laws and had you been looking to locate your business in Europe and decided to locate in Ireland, YOU would have also received the same tax rate. Ireland was looking to employ their citizens. . . and succeeded in doing that.
Under the treaty that formed the European Economic Union, the EU is NOT permitted to regulate or interfere in any way with the tax policy of member nations. . . yet that is exactly what this Commission on Competition is attempting to do through the back door by claiming that Ireland had illegally granted Apple (back when it was a tiny company) a tax advantage to compete against who? Nokia? IBM? Orange? Spectrum? Olivetti? Siemens?
Apple had a Market Cap of only $3 Billion back in the late 1980s when this tax deal with Ireland was crafted. . . it was not at all a huge company then. Apple was not making cellular phones when this deal was struck? What European companies were making home computers then?
But these are not facts Realist is bringing to the table. What he is claiming is only obfuscating the actual facts.
The TREATY that allowed the European Economic Union to be created in the first place specifically PROHIBIT the EU from interfering in any way with the member nations’ tax laws and regulations. The order forcing Apple to pay billions of Euros to Ireland is in violation of that international treaty that are the over-riding laws under which the EU even exists, and all other regulations of the EU derive their authority. It is also in violation of multiple other treaties having to do with international taxation. A regulation of the EU cannot over ride a provision of its base treaty or other treaties that have been in place for decades and even centuries. . . but that is what the regulatory body that is making this order is claiming they have the power to do!
Ireland was free to structure its agreements with multi-national businesses as it saw fit to enhance its economy. The same rates and agreements offered to Apple were available to all businesses who agreed to locate their European headquarters in Ireland. It was not an illegal deal under European regulations because the EU is not permitted under the treaties to regulate TAXATION.
This attempt to do so is based on inter-member COMPETITION, a backdoor approach, by the European Commission on Competition, whose charter does not give it any authority to regulate taxation. it is an over-reach by the chairwoman of that commission.
She is attempting to up-end the entire standard model of income taxation used throughout the world based on her idea of how it should be applied. For centuries income taxes are collected in the home nation of the company. This is recognized world wide. . . thus a company which is incorporated in the UK pays its income taxes in the UK, while a company that is incorporated in the US pays its income taxes in the US and a company that is incorporated in Hong Kong, China, pays its income taxes in China. This permits businesses sanity in accounting. . . and equity around the world.
There’s no grown up issue Bottyboy can’t dumb down for his tiny brain. It’s like someone reinvented Zune Tang for the Tim Cook era… Funny. I wonder why someone would do that. /s
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