“Senator John McCain said Ireland still faces questions on how corporations use the country to lower taxes after Finance Minister Michael Noonan moved to calm a controversy triggered by Apple Inc. (AAPL)’s practices,” Joe Brennan, Donal Griffin and Jesse Drucker. “Noonan laid out plans yesterday to scrap a measure in allowing companies registered in the country to be ‘stateless’ in terms of tax residency. This may enable companies to channel worldwide profits through their Irish-incorporated company and not have a tax liability anywhere, Noonan told reporters. He said ‘not very many’ firms other than Apple do this.”
“Noonan’s move ‘is encouraging,’ Arizona Republican McCain and Levin, the Michigan Democrat who leads the U.S. Senate investigations subcommittee, said in a statement late yesterday. ‘Important questions do remain, however, including whether the new rules will continue to allow Irish subsidiaries to dodge taxes by, for example, excluding substantial income” from Ireland’s 12.5 percent corporate tax rate, they said,'” Brennan, Griffin and Drucker report. “While the proposal targets companies like Apple using Irish subsidiaries that don’t declare a tax residence anywhere, many U.S. multinational companies rely on Irish subsidiaries that claim to be ‘tax resident’ in zero or low tax jurisdictions — which accomplishes the same savings.”
“Google last year cut $2.2 billion off its tax bill by paying royalties to an Irish unit that it said is headquartered in Bermuda. The announcement by Noonan would not affect that structure, known as a ‘Double Irish,'” Brennan, Griffin and Drucker report. “Yahoo! Inc. (YHOO) has paid royalties to an Irish subsidiary resident in Grand Cayman; LinkedIn Corp. (LNKD) has paid royalties to a subsidiary that is resident in the Isle of Man; anti-virus software maker Symantec Corp. (SYMC) uses one claiming residency on the island of Jersey; and EBay Inc. (EBAY) has managed its tax bill using an Irish subsidiary that declared its tax residence in Luxembourg, corporate filings show.”
Read more in the full article here.
MacDailyNews Take: How about leaving the Irish alone and minding your own business, including questioning why companies work so diligently to avoid U.S. corporate taxes, geniuses?
Here, we’ll help: The U.S. corporate tax rate is way too high. Obviously.
Under the current U.S. corporate tax system, it would be very expensive to repatriate that cash. Unfortunately, the tax code has not kept up with the digital age. The tax system handicaps American corporations in relation to our foreign competitors who don’t have such constraints on the free flow of capital… Apple has always believed in the simple, not the complex. You can see it in our products and the way we conduct ourselves. It is in this spirit that we recommend a dramatic simplification of the corporate tax code. This reform should be revenue neutral, eliminate all corporate tax expenditures, lower corporate income tax rates and implement a reasonable tax on foreign earnings that allows the free flow of capital back to the U.S. We make this recommendation with our eyes wide open, realizing this would likely increase Apple’s U.S. taxes. But we strongly believe such comprehensive reform would be fair to all taxpayers, would keep America globally competitive and would promote U.S. economic growth. – Apple CEO Tim Cook, May 21, 2013
Related articles:
Ireland to close Apple’s tax loophole, but leave bigger one open – October 15, 2013
U.S. SEC ends review of Apple taxes, overseas cash – October 5, 2013
Obama, world leaders push big companies like Apple, Google to pay more taxes – September 6, 2013
G20 think tank OECD proposes blueprint for global crackdown on tax avoidance – July 19, 2013
Apple again faces scrutiny after paying no UK corporate taxes for 2012 – July 1, 2013
Bloomberg News’ awful reporting on Apple’s U.S. corporate taxes – May 30, 2013
Thomas Sowell on Apple, corporate taxes, and ‘the road to serfdom’ – May 28, 2013
Former Senator Sununu: Congress wrote the tax laws, so why blame Apple for obeying them? – May 28, 2013
Taxing Apple just taxes you – May 24, 2013
Don’t tax Apple, tax its shareholders – May 24, 2013
If Apple paid more tax, we might pay less or something – May 22, 2013
Apple CEO Tim Cook pounds another nail into the Keynesian coffin – May 22, 2013
Apple CEO Cook makes no apology for company’s tax strategy – May 22, 2013
Apple CEO Tim Cook charms Capitol Hill – May 22, 2013
Rush Limbaugh: ‘High-tech lynching: Senate attempts to crucify Apple’ – May 21, 2013
Nobody on U.S. Senate committee laid a glove on Apple CEO Tim Cook – May 21, 2013
Senator Rand Paul: Senate committee ‘should apologize to Apple for bullying one of America’s greatest success stories’ (with video) – May 21, 2013
Ireland: We have no special tax rate deal with Apple – May 21, 2013
Apple prepares for Washington onslaught: CEO Tim Cook isn’t taking any chances with senators looking to grandstand – May 21, 2013
Watch Apple CEO Tim Cook’s live testimony before U.S. Senate, starting at 9:30am EDT – May 21, 2013
U.S. Senate investigation found no evidence that Apple did anything illegal in avoiding taxes – May 20, 2013
Apple pays under 2% on overseas profits and it’s entirely legal – November 5, 2012
Google, Apple, eBay shouldn’t pay taxes – people should pay taxes – November 25, 2012
So how much did Apple really pay in taxes? – November 1, 2012
Apple’s showdown with the U.S. government over taxes on offshore cash – July 13, 2012
Apple‘s $74 billion tops list of U.S. tech companies’ overseas cash – July 9, 2012
Apple’s dividend move puts spotlight on foreign cash holdings, repatriation tax reform – March 20, 2012
Apple: Good start; and what about the overseas cash? – March 19, 2012
Apple’s foreign cash hoard piles up: $54 billion and rapidly growing – January 11, 2012
Senator John McCain eyes Apple’s $54 billion overseas cash pile – November 3, 2011
Google joins Apple in push for U.S. repatriation tax holiday – October 3, 2011
Apple lobbies Obama for tax holiday, wants to bring overseas bounty home – August 24, 2011
U.S Senate Democrat Schumer allies with Apple, other multinationals on repatriation tax talks – June 21, 2011
U.S. companies push for tax break on foreign cash – June 20, 2011
Apple, Oracle, Duke Energy, others organize lobbying blitz for tax holiday – February 17, 2011
instead of sounding off on ireland, which is currently still open for business, why don’t they focus on their own backyard and get us open for business again. nothing like trying to address our problems here wh… LOOK! A SQUIRREL!
I agree. The U.S. needs to get its own house in order. We are not in a position to dictate policy to other countries.
yep, just like my dog, badger.
only he is way more likeable, and …he doesn’t even poop in his own yard, unlike those dildos in the house of reprehensibles.
Greedy, stupid and blind US congressmen just want 1) more votes for sounding tough… and 2) free money that does not belong to them/ USA. Taxes for items sold overseas are paid for overseas in the country that the items sell in. PERIOD. That capital is then moved to Ireland where it can be used and controlled easily.
Its the USA that wants to double tax the money, once in the country of sale and once in the USA cause we are greedy.
And Ireland understands this but does not want to upset the worlds ire.
As usual, no progress out of congress, just noise designed to LOOK GOOD. Sad, just sad.
A red mist comes over me whenever I hear Americans talk about my beloved Ireland in this way. We Irish have our own tax laws and do not need Americans to come over here to teach us how to tax corporations.
I’ll slam my Irish fist so hard down on Levin’s and McCain’s face so hard they’ll be seeing stars into next week.
It doesn’t pay to rile the Irish!
I’ll hold them for you.
And, in the tradition of the American South, I will gladly hold your coat.
I’m American but lived in Dublin for a year and love the Irish and Ireland. I believe you and agree with you. The Irish don’t take no guff.
If you punch him hard enough he will gladly make a video extolling the virtues of Irelands tax system, which Ireland can then use as propaganda to attract new corporations!!
But seriously America, have we not had enough of this drunken blow-hard? He was a terrible service-man, largely getting by on the achievements of his dad and granddad. He was a mediocre pilot, generally unsat, insubordinate and drunk. His service record was unremarkable, and other POW’s have cast doubt on many of his claims. He is a philandering gold digger and a government whore to corporate interests. Who the hell cares what this clown has to say. To think people thought he should be president..
There are no questions.
Investigation done, there is no tax evasion.
Ireland can do whatever they want. If the US, or any other country doesn’t like it then that’s what diplomatic relations are for, it should be discussed to see if any agreements can be reached to be of mutual benefit. Ultimately, US law is for the US, not Ireland.
If the EU would stop paying the Irish billions of Euros every year Ireland would adjust their tax heaven laws at once. Problem solved.
Or, McCain could just mind his own f*cking business.
Screw you Levin and McCain, and all you politicians.
Why don’t you face “questions” about your continuing worthlessness?.
Idiots, criminals, shysters & bums.
Hey, great name for a law firm!.
Dewey, Cheatham & Howe.
Exactly
TERM LIMITS!!! Get rid of ALL the professional politicians and do the system the way it was intended – go to DC for a few years and then LEAVE!!!
Let’s see, if a US company pays more tax to Ireland, they would then get more foreign tax credits and have to pay less tax to the US when that income is repatriated. Sounds smart.
What are you going to do John, invade Ireland? Please Ireland, tell McCain and Levin to look in their own backyards before casting blame.
most everyone in Ireland are already bombed.
“… invade Ireland?”
Please, don’t give them any ideas!
I have seen the enemy and be is us.
Ok Ireland, watch your skies. These assholes will be sending drones over next, looking to destroy WMD’s. That’s Guinness, or a weapon of mass distraction…😉
MDN is being very one-eyed about this. Ireland has gamed the system in order to attract investment, at the cost of nations across the world. The US corporate tax rate is high when compared to zero, but not otherwise. Corporate taxes have no effect on the profitability of a corporation, since they are paid out of shareholders’ funds AFTER profits have been declared. Taxes can affect the amount of money a corporation can retain for future investment, but in reality a higher tax rate just means lower dividends.
In any argument about taxation you must take a holistic view. The US has a problem with balancing income and expenditure. The right want less expenditure on those areas they don’t support, and reduced tax on those areas they do support. Ditto for the left. If you cut corporate tax you have either increase other taxes or decrease expenditure. Given the huge and increasing wealth gap in the nation, decreasing expenditure on the disadvantaged and decreasing taxation on the wealthy is an unsustainable strategy which inevitably leads to social unrest and, in extreme cases, to revolt.
Ireland is under pressure from all quarters to stop gaming the system and withdraw support from other tax havens. Their day in the sun is coming to an end, as it should.
As for tax on repatriated earnings, why should this be tax-free in the first place? The US should move to repeal the tax holiday on overseas earnings altogether. If they then offer a reduced rate on untaxed earnings held overseas for twelve months all the money will come back to the US.
“Gaming the system” ?? What system?
Ireland is a sovereign nation, they are free to do as their citizens and government see fit. Who the hell are you or America for that matter to tell them how to operate their tax code? Talk about misguided arrogance…
A message to my stupid US government:
LOWER THE TAXES ON FOREIGN INCOME!
That is the solution, you blithering idiots.