“Apple has operated almost tax-free in Ireland since 1980, welcomed by a government keen to bring jobs to what was then one of Europe’s poorest countries, former company executives and Irish officials have said,” Poornima Gupta and Padraic Halpin report for Reuters. “Apple, one of Ireland’s top multinational employers, denied avoiding billions of dollars in U.S. taxes and said its arrangements helped fund research jobs in the United States. The committee revealed that Apple’s Irish companies, some of which are not tax resident in any jurisdiction, allowed the group to pay no tax on much of its overseas earnings in recent years.”
Gupta and Halpin report, “A former company executive and Irish officials told Reuters the almost tax-free status dates all the way back to Apple’s arrival in County Cork 32 years ago. Apple must have seemed attractive to Ireland and to Cork. Amid a generally moribund Irish economy, Cork had been hard hit by the closure of its shipyards and a Ford car plant, and in 1986 nearly one in four were out of work in the city.”
“In the early days, Apple’s staff sat down to meals together. Now the company employs 4,000 in Ireland and is the country’s biggest multinational employer,” Gupta and Halpin report. “‘There were tax concessions for us to go there,’ said Del Yocam, who was Vice President of manufacturing at Apple in the early 1980s. ‘It was a big concession.’
“In fact, the deal was about as good as a company can get,” Gupta and Halpin report. “‘We had a tax holiday for the first 10 years in Ireland. We paid no taxes to the Irish government,’ one former finance executive, who asked not to be named, said. Apple wasn’t an exception, although it was among the last to enjoy such favorable treatment.”
Read more in the full article here.
Related articles:
Ireland: We have no special tax rate deal with Apple – May 21, 2013
Apple announces 500 new jobs in Ireland – April 20, 2012
Apple set to create up to 350 jobs in Cork, Ireland – June 30, 2011
Happy St. Patrick’s Day! Ireland to roll out Apple Mac solutions in 3,500 primary schools – March 17, 2006
For the love of God when are people going to get this through their skulls: The money that went to the Irish subsidiaries HAD ALREADY BEEN TAXED IN THE JURISDICTION IN WHICH IT WAS EARNED!
“The committee revealed that Apple’s Irish companies, some of which are not tax resident in any jurisdiction, allowed the group to pay no tax on much of its overseas earnings in recent years.”
Furthermore, Apple has been pretty clear that the after-tax profits transferred to Ireland are invested, and Apple pays the US government corporate income tax on the earnings from those investments.
Not to mention all the personal income taxes paid by those formerly out of work employees.
Hasn’t anybody heard of A Holding Company, for fuck’s sake?
Not in Australia.
Total Apple turnover in Australia $6 BILLION AUD PA made up of ..
Apple Australia $1 BILLION AUD
Total tax paid $28 MILLION
Apple stores online and retail (100% American owned) $5 BILLION AUD
Total tax paid NIL
Total tax paid all up $28 MILLION AUD 0.466%
Ok fanboy, here we go.
What you’re saying is complete moronic bullshit.
Apple uses tax havens, Ireland being one of them, to avoid paying takes. Let’s repeat this a few more times.
Apple uses tax havens, Ireland being one of them, to avoid paying takes.
Apple uses tax havens, Ireland being one of them, to avoid paying takes.
Some 70% of Apple’s income, Apple being a US company, is NOT TAXED in the US. Some $100 billion total over the past several years is tied up in tax havens. Apple has paid a total of maybe a few percent tax on it across all of its several tax havens stretching all the way to the Virgin Islands.
Apple never paid any tax to the US government on this money that’s sitting in tax havens you idiot. And they went to far as to charge themselves royalties from tax havens to further reduce their US taxable income.
You got that you fucking fanboy?
This android Taliban needs to be banned. Very offensive.
You know what will stop all this nonsense? Scrapping the income tax. I’m a big supporter of the FairTax, a 100% consumption (read: sales) tax.
Now, before you jump on me for supporting a “regressive” tax plan, please go read about it. Nobody pays a single dollar in taxes up to the poverty level. For every dollar you spend above the poverty level, you pay taxes.
Now, I don’t support the plan it in entirety. There are a few changes I would make, but on the whole, I think it’s great. At the very least it’s thought-provoking.
http://www.fairtax.org/site/PageServer?pagename=HowFairTaxWorks
I would need to see the breakdown on how those of different incomes would be taxed using that approach.
All sounds very interesting until you look at the numbers.
You don’t need to see a breakdown. It’s flat–the same for everyone. People who spend less than you will pay less tax. People who spend more than you will pay more tax. The current system has people obsessed about what “good deal” everyone else is getting. A flat system eliminates that.
No, it’s not flat, because of the prebate. Please, go read the plan.
Calling it the “Fair Tax” with capital letters doesn’t mean it’s a fair tax.
You end up taking lower-income people at a way higher rate as a percentage of their income.
This is why I asked you to read the plan before passing judgement. You obviously didn’t.
Because of the “prebate,” people are only taxed on the dollars they spend above the poverty level. If you live below the poverty level, the government is actually giving you money (ie. you’re paying negative taxes). If you live at the poverty level, your effective tax rate is 0%. From there, the more you spend, the higher your effective rate goes.
Now, one could argue that a person with an income of $2M could easily live on $1M and pocket the other half, and thus “the rich get richer.” That’s a valid argument. Hence the reason I stated that I don’t support the plan in its entirety. I would keep the income tax around, but with only one marginal bracket at the highest level (eg. 40% on every dollar above $500K).
Listen to your post. Get someone to read it to you.
You know damn well that lower income people get cheques in the mail from one or more government assistance programs.
In Canada lower income people get sales tax rebates quarterly.
And people with high incomes — the so called top 5%, but most certainly the top 1% — will purchase their goods outside the U.S. They won’t buy their expensive Italian shoes in the U.S. They’ll buy them in a country with a <<1% (or no) sales tax (or "value added tax [VAT]"). There will be countries that will set up special extremely low rates for huge purchases (high end cars, planes, high end appliances, etc.) just so they get the sales funneled through them. So a person who spends a million a year spends only $40,000 in the U.S.
Compare that with the family that spends virtually 100% of their $50,000 income (with no income tax) in the U.S.
The rich guy being able to set up buying the vast majority of his purchases not in the U.S. pays $40,000 (100% of that $40,000). The family is only able to buy $25,000 worth of "stuff" and pays $25,000 in tax (100% on that $25,000).
The million dollar spender has a 4% effective tax rate ($40,000 on a $1 million) and the middle income family has a 100% tax ($25,000 on $25,000).
Then yet again, the middle income people will get taxed with the highest *effective* rate.
I get what you’re saying about the very wealthy. There are ways around that, such as an import tax equivalent to the sales tax. But it’s a valid point worth some thought. As stated above, if I were writing the law, I’d pair it with a single income tax on the highest earners (eg. 40% of every dollar above $500K).
However, I’ve no idea what you’re doing with the numbers:
A family of four, in 2012, using the FairTax’s rates, would receive a $6960 “prebate” for an effective tax rate of 0% on their first $30,260 of income. Using your assumption that they spend all $50K, they would then pay tax on the remaining $19740, for total taxes paid of $4,540.20. That leads to an effective tax rate of 9.08% (4540.20/50000). And if they are able to put some of their income into a savings account, their effective rate drops even lower.
I believe you are confused about what an effective rate is, because your numbers are nonsensical. Paying taxes on 100% of your income does not mean you have a 100% effective tax rate. Effective Tax Rate is calculated by dividing Total Income by Total Taxes Paid. If I earn $100K and pay $25K in taxes, my effective rate is 25%. If I pay $42K in taxes, my effective rate is 42%. A 100% effective tax rate would mean that you are giving every penny you earn to the government.
I wrote that backwards:
Effective Tax Rate = Taxes Paid / Gross Income
If something is made in China and shipped to then sold in Italy, why does the U.S. Government get 35%?
I can see a smaller amount just because the “widget” was “Designed by Apple in California”
But 35%?
BTW – I would say the same thing about Microsoft.
One last thought – Should Samsung pay the U.S. government 35% for something that was made in China and sold in Europe because they stole their designs from California?
To your last question: yes – about $1.04B!
It’s Apple that Samsung owes. Maybe apples will be over by 2020 and Apple will finally see some of that cash. Of course by then mobile phones will be a thing of the past and Samsung will be copying some other communication technology from Apple or other company. tC was right to bring up IP protection in the US as the courts more slower than a snail.
Jobs, certainly no right wing demagogue, pleaded with Obama to change the tax code to be reasonable so as to permit repatriotation of Apple’s foreign profits. Apple wanted to use and spend the money here in USA. Of course such spending would help business and the economy here too.
Obama didn’t want to do anything that could be interpreted as pro-business I suppose.
That’s interesting, since when does the President alone change the tax code?
I think what Jobs told Obama is that if we wanted to create the economic environment of China, we would have to be more like China. China is a socialist country.
To change the tax code, there has to be a reasonable expectation from all political parties to work together. Meaning that the wealthy will no longer have their private jets and vacation mansions be tax free and that businesses will be allowed a competitive tax expectation.
“Though they weren’t grilled before a U.S. Senate subcommittee on Tuesday like Apple, Google and Yahoo rely on Irish subsidiaries to avoid taxes on billions of dollars in income, and they go one step further than Apple by utilizing offshore accounts.”
http://appleinsider.com/articles/13/05/22/like-apple-google-yahoo-also-avoid-taxes-by-way-of-ireland
MSN = censorship
“Tech Companies Love Ireland’s Low Taxes, but They May Be ‘Detrimental’ to Economy”
“Ireland’s low corporate tax rate is good for global companies like Apple, but is it good for the Irish people? University College Dublin senior lecturer Kieran Allen says no.
Only about 7 percent of the Irish workforce is actually employed at these multinational companies, he said. And as long as the tax rates on these companies remain low, the country’s domestic economy will have to bear the burden, putting the squeeze on residents and small businesses.”
http://www.bloomberg.com/news/2013-05-22/tech-companies-love-ireland-s-low-taxes-but-they-may-be-detrimental-to-economy.html
Would you rather have 4,000 more unemployed Irish not paying taxes in ireland on their earned incomes?
Damn, this stuff is really just over your hear, you just don’t get it, do you. Or are you so indifferent to humanity, ethics, morals and just want more, more, more…
“Amid a generally moribund Irish economy, Cork had been hard hit by the closure of its shipyards and a Ford car plant, and in 1986 nearly one in four were out of work in the city.”
Again, would you be prefer to be unemployed or with a job?
Ireland did what it had to do to and Apple has been good to the country employing 4,000. Why don’t you ask those 4,000 and that spend and contribute to the irish economy to quit there jobs over your opinion?
It’s really more of a question of whether it’s willful ignorance or intellectual dishonesty. Either way, there’s little to gain by engaging them. More’s the pity…
Would you work for a blowjob? How about two? What would be a fair rate of compensation for you?
And for the two blowjobs you receive, would you voluntarily give it all away to the government?
Of course you would, because you’re a government whore.
With your comments, you make cognativedisonance sound like Jesus.
I washed dishes once for a burger and a beer.
Does that count?
Does the government still get 35%?
“Cook Defending Apple Puts Loophole-Closing Back on Agenda”
“A congressional hearing into Apple Inc. (AAPL)’s use of offshore tax shelters called attention to how U.S. companies lower their taxes, and underscored the difficulty Congress confronts when trying to end the practice. ”
http://www.bloomberg.com/news/2013-05-22/cook-defending-apple-puts-loophole-closing-back-on-agenda.html
Congress could end the practice they created in the first place, by establishing a flat-rate across-the board 10% tax and level the field.
They could also drop taxing all together and just live off the C.A.F.R.s they created – http://cafr1.wordpress.com
The government wrote the rules Apple’s just playing by them.
Imagine a world where the US government got most of its tax revenues from working Americans!
Really seems hard to imagine,huh?
We should have a flat tax alright 0% no tax.
Many states don’t have sales or income tax and it should be that way nation wide. Why should I pay my hard earned money to a govt so it can spend itself broke and sed weapons overseas to our enemy’s?
No flat tax will ever work. Frankly right now you are better off because millions every year don’t pay taxes.
Jim
Thursday, May 23, 2013 – 2:31 pm · Reply
For the love of God when are people going to get this through their skulls: The money that went to the Irish subsidiaries HAD ALREADY BEEN TAXED IN THE JURISDICTION IN WHICH IT WAS EARNED!
Not in Australia.
Total Apple turnover in Australia $6 BILLION AUD PA made up of ..
Apple Australia $1 BILLION AUD
Total tax paid $28 MILLION
Apple stores online and retail (100% American owned) $5 BILLION AUD
Total tax paid NIL
Total tax paid all up $28 MILLION AUD 0.466%
4000 jobs. Not bad.