“Ireland expects iPhone maker Apple to start paying up to 13 billion euros ($15.4 billion) in back taxes into an escrow account in the first quarter of 2018, the finance minister said on Monday,” Reuters reports.
“The European Commission said the record sum was the result of Apple receiving unfair tax incentives from Ireland,” Reuters reports. ““We have now reached agreement with Apple in relation to the principles and operation of the escrow fund,” Finance Minister Paschal Donohoe told reporters before a meeting with European Competition Commissioner Margrethe Vestager. ‘We expect the money will begin to be transmitted into the account from Apple across the first quarter of next year.'”
Read more in the full article here.
MacDailyNews Take: The fiasco continues.
SEE ALSO:
Ireland expects progress in Apple tax clawback in coming weeks – November 21, 2017
Apple holds on to tax billions as Ireland set to miss deadline – November 16, 2017
EU sues Ireland over $15.3 billion tax clawback from Apple – October 4, 2017
Ireland opposes EU’s 13 billion euro Apple tax grab, calls it unjustified – August 17, 2017
Apple close to deal protecting Ireland in fight over EU tax grab – August 11, 2017
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
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
Dam. Wish I could retroactively bill my clients a higher rate than promised.
Better analogy: You pay your workers $10.00/hour, pursuant to a written contract voluntarily entered between you. They are happy to work for that wage, but it is illegal under a state law that requires paying $15/hour. The state’s Department of Labor files suit to force you to pay the legally required back wages with interest.
The argument (which I am not necessarily buying) is that the rate Ireland promised was not within its legal power to promise (due to preexisting EU treaties), just as your workers cannot promise to accept less than the minimum wage.
Better analogy: You work for the state government. They pay you$15 an hour and you are happy to work for those wages. but it is illegal under a state law that requires only paying $10/hour for your skills and effort. Department of Labor files suit to force your state you to take back from you the legally required back wages with interest.
correction to my above post. Department of Labor files suit to force your state to take back from you the legally required back wages with interest.
You have to pay it back and your state will just pass it on.
If you like your analogy better, fine. Either way, someone who was enriched by a violation of the law is required to give back something that they were never entitled to in the first place. In my example, it is the $5/hr that was illegally withheld. In yours, it is the $5/hr that was illegally paid.
I chose my example because the agency enforcing the law has no direct financial stake in the outcome, like the EU in the actual case. Your example would only be better if the $15B were being paid to the EU, rather than Ireland.
Assuming Apple loses… which I hope it doesn’t.
Pedro,
On re-reading your two comments, I see your problem.
Most of the discussions on this website (and many elsewhere) assume that the EU is trying to collect $15B from Apple that will be payable to the EU. That is not the case.
As I say to Derek Currie further down the thread, this is an effort (whether correct or not is for the courts to say) to reinforce one of the founding principles of the EU and its predecessor organizations back to the early 1950s: that free competition between the nations in the European Community requires free economic markets without the distortion of government subsidies given to individual companies.
If Apple loses this case, it will pay the back taxes owed to Ireland, which will keep the money that it does not want (preferring its own tax policies to those it accepted when it joined the Common Market). The EU will not directly benefit, aside from collecting court costs.
As for indirect benefits, Ireland will not owe anything additional to the EU, because the EU administration is primarily funded by a “tax” on national GDP and a share of the Value Added Tax, neither of which will be affected by the outcome of the lawsuit.
This is what happens when you abandon your sovereignty to an unelected cartel of bankers and bureaucrats.
Your political party sold out to these evil international bankers! Oh, but you only recognize what Lyin’ Hannity tells you. Got it.
Ireland joined the club of their own free will, and received benefits too numerous to count. They need to play by the rules.
In botvinnik’s twisted world, everything would be better if there were no alliances. No UNITED States of America, just 13 Sovereign Colonies. No WW2 Allies, just winner take all (sorry Britain).
Interesting that botvinnik has no problem with Putin reassembling the USSR however. First by taking Crimea, then Ukraine subterfuge, finally with puppet Trump abandoning European allies while tangling up with North Korea. Putin is playing Trump for the fool he is.
Divided we fall.
“bluh bluh bluh..buh, buh…muh MOOLER!”
you lose.
again.
Someone should tell the EU to pound sand.
The news media acts as though Apple is the only company on the planet who has ever used tax dodges. Has no other major tech company done this before? Apple seems to be constantly singled out on this point.
All multi-national corporations seek to minimize their taxes via creative application of the laws. Some strategies go beyond creative and extend into the illegal.
This is nothing new, and it probably won’t ever stop. I would posit that the first step would be to develop worldwide trade and taxation standards (which is unlikely to happen). An even stronger step towards a truly global economy would be a truly united planet which, given human nature, is probably a fantasy.
Advocating the abdication of American sovereignty in favor of global governance is treason.
The Fourth Reich, aka the EU, is on the verge of collapse…Fraü Merkel, The Angela of Death, will be gone soon.
Not
Apple’s
Problem.
This is only between Ireland and the EU. Pay the EU what is due the EU
We seem to go through this every time the issue arises. Nobody owes the EU anything. Ireland and Apple insist that Ireland isn’t owed anything, either. The EU says Apple owes Ireland $15B, which they dispute. If the EU wins the pending litigation, Ireland will get $15B it does not want; if the EU loses, Apple will keep the money.
In neither case will the EU collect any of the $15B, although it will collect court costs if it wins. Their interest in this is not monetary, but in reinforcing the principle that the EU treaties constrain the member states from using tax incentives to subsidize individual companies.
To return to my analogy above, when the state Department of Labor files suit to enforce the minimum wage laws, the back wages go to the employees, not the state government. It does not matter if the employees don’t want the money, or if both parties were genuinely mistaken about the law.
The EU was a mistake and creates sovereignty as well as free trade issues. Alliance is good, open borders and dictation of tax rates/competition is a disaster.