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Commission says Ireland granted undue tax benefits of up to €13B to Apple

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Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#161

Post by barking »

dogma1138 wrote: post #147
flexie wrote: post #104

Earlier quoted context omitted.

Yes, it is Apple's problem and no, Apple is not a victim in this thing. The EU treaty is Irish law as well and lawyers from all over the union (myself included) have been looking on at this blatant violation of EU rules for years wondering how long multinational companies would be able to keep the schemes alive. The Irish people have voted for politicians who adopted the EU treaty which bans subsidies to large corpor…

>The Irish people benefits when subsidies to French, British or German corporations are curbed. Are you serious? Subsidies to German and French corporations were not curbed they were replaced by the ludicrous loans that the Germans and the French give out to the "poorer" and "less industrious" EU member states so they in term can go around and buy German goodies. And when this Ponzi scheme blows up because of a finan…

They forced Ireland to 'take one for the team' and prevent contagion by repaying bad commercial bank loans from overseas banks to the failed Irish banks. In other words they prevented Ireland from doing an Iceland. They hinted that new, shared burden, measures, to be put in place, to cover such eventualities in the future, would be applied retrospectively to Ireland but they weren't.

During the bailout term the EU/ECB adopted a far harder stance against the country than the IMF advocated.

And doubtless on the back of this case there will be a legal action in Europe and a resulting large fine on Ireland.

You just don't get the feeling that this sort of treatment would be given to Germany or France.

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#163

Post by sangnoir »

zigzigzag wrote: post #121
verinus wrote: post #102

Earlier quoted context omitted.

oh they were. it's actually quite clear: if you exempt some corp from taxes you are paying them the exempted sum compared to another business not receiving the exemption. In my opinion it is highly unethical to construct such financial mechanisms with the only aim to reduce tax payments.

Not taxing someone is not the same as paying them! By that logic I am paid by the government every time I listen to Simply Red without them taxing me for the privilege? Why am I not rich then? Damn me, the linguistic backflips in this thread are amazing. Tax is the taking of something . Low taxes mean you take less , not that you are generously paying people!

> Not taxing someone is not the same as paying them!

That is a terrible straw-man - no one ever claimed that in this thread. Additionally - your argument relies on word play: in practise, Walmart giving you a $10 bill after you buy a $100 item has the same effect as giving you a $10 discount on the item.

When one corp (Apple) pays less taxes than others in the same jurisdiction (Ireland in this case), it is unfair - logically and according to European law. If Irish taxes were uniformly low to all companies (including the German, French & Greek ones), the EU would have no case.

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#164

Post by rayiner »

eru wrote: post #13
rdslw wrote: post #4

Good. Read how Tim Cook publicly considers Nobel economist Joeseph Stiglitz as a one who do not know what he (Stiglitz) is talking about. Eye opening. Excerpts from: http://www.washingtonpost.com/sf/business/wp/2016/08/13/2016... Q: What do you say in response to Nobel economist Joseph Stiglitz’s comments on Bloomberg [television], where he called Apple’s profit reporting in Ireland a “fraud”? Tim Cooks answer: I did…

Apple paid taxes according to Irish laws. Is it Apple's problem that Irish law disagrees with EC agreements? (Seems to be Ireland's problem.) If people want companies to pay certain taxes, they should vote for politicians that pass laws that require companies to pay those taxes.. In any case, we should be taxing land value. That's harder to avoid: you can't hide land.

Ireland isn't a sovereign country. It's an EU member state. So it's like Apple violating Federal law and saying it's okay because what they're doing is legal under California law.

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#165

Post by tpm »

galtwho wrote: post #145
rdslw wrote: post #37

Earlier quoted context omitted.

What actually happened between IE and AAPL is on the verge of extortion and bribery - the only difference is not on personal level but on Gov vs Bus. We should heavily penalise this, as AAPL literally stole money from both US and EU people. Because of this arrangement: Apple paid less taxes in US, hence US people have worse roads, healthcare etc. To the same in EU (but here by bad IE decision). Money taken is on AAPL…

>> as AAPL literally stole money from both US and EU people Well you have US Govt now arguing on behalf of Apple, which suggests that US people were not going to be the losers. The losers are people of other countries where Apple and other MNC's don't pay their fair share of taxes. The plan is to hoard this money in low tax jurisdictions and I guess for 2 purposes 1. wait for a lower tax rate amnesty to be offered in…

>> Well you have US Govt now arguing on behalf of Apple, which suggests that US people were not going to be the losers.

Not really. The US Govt sides with an US corporation in a conflict with a foreign government. That's not surprising and does not imply anything.

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#166

Post by noir-york »

People here are commenting on Ireland (and other jurisdictions) engaging in tax arbitrage to attract companies and jobs.

Competing on tax rates and negotiating tax deals were a huge MNC like Apple pays a ridiculous 0.005% is bad: morally wrong, cuts to public services, increases unjustifiable economic inequality and is just not fair on other much smaller firms who have to pay full whack on the tax.

Apple, FBK, etc don't see it like that - they will engage in aggressive tax planning to minimise their tax, hoarding billions of dollars. And its not like they do anything productive with their cash pile; its not like it goes to higher pay checks for their Asian workers. Instead, its spent on share buybacks to prop up sagging share prices and keep Wall St happy.

Here's a better approach: tax companies on their profits and remove or reduce income tax and capital gains tax. This aligns incentives to:

1. encourage and reward founders to start new business

2. the most valuable employees tend to be mobile ones - a core EU principle is free movement so compete for the best employees by lowering taxes and giving them great public services. Companies will follow.

3. tax company profits and everyone is on the same level playing field: provides an incentive for companies to reinvest their profits into growth (and indirectly jobs).

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#167

Post by kagamine »

Angostura wrote: post #89
rdslw wrote: post #4

Good. Read how Tim Cook publicly considers Nobel economist Joeseph Stiglitz as a one who do not know what he (Stiglitz) is talking about. Eye opening. Excerpts from: http://www.washingtonpost.com/sf/business/wp/2016/08/13/2016... Q: What do you say in response to Nobel economist Joseph Stiglitz’s comments on Bloomberg [television], where he called Apple’s profit reporting in Ireland a “fraud”? Tim Cooks answer: I did…

Who committed the "fraud"? Apple, the Irish government, or both?

http://europa.eu/rapid/press-release_IP-16-2923_en.htm

is the link to the EU press release that answers your question. Irish govt. tax deal is in violation of EU tax law and the EU recommend that the Irish govt. seek recompense to the tune of €13bn plus interest.

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#168

Post by Zach_the_Lizard »

blahi wrote: post #137
pjc50 wrote: post #115

Earlier quoted context omitted.

However, the nice thing about land taxation is that hiding the ownership doesn't matter: you can see from the land registry that it's owned by Shady Cayman LLC, but you don't care who they really are so long as you have a corresponding payment to the tax authorities. If they fail to pay that becomes a lien and ultimately reposession.

Isn't land already taxed? I believe it is, so you must be talking about increasing the taxes on land while scrapping the rest. Or even further, probably taxing property (a skyscraper doesn't have too big of a land footprint). A few questions I have about this: How do you tax companies which rent their office/production space? Isn't taxing land punishing companies planning for growth? It is not uncommon to buy/rent sp…

A land value tax only taxes the lane value, not any improvements. Improvements can make it more valuable of course (e.g. via proximity to work, entertainment, subway, etc.) but the improvements are not assessed.

The idea is that taxing improvements means reducing the incentive to build and ultimately passing along the tax to renters.

A LVT doesn't allow pass through as the supply of land is fixed, and a tax cannot reduce the supply of land. It encourages more intense use of land in expensive areas and reduces land speculation.

You can think of it as a rent to the government for the land.

Growing companies who buy expensive core land are punished for making no use of the land, but if it's a soulless suburban office park or rural land kind of deal the costs are far lower.

Really what would happen is zoning would be looser as the incentives align and therefore a greater supply of housing and offices would follow, aiding growing companies.

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#169

Post by pjc50 »

blahi wrote: post #137
pjc50 wrote: post #115

Earlier quoted context omitted.

However, the nice thing about land taxation is that hiding the ownership doesn't matter: you can see from the land registry that it's owned by Shady Cayman LLC, but you don't care who they really are so long as you have a corresponding payment to the tax authorities. If they fail to pay that becomes a lien and ultimately reposession.

Isn't land already taxed? I believe it is, so you must be talking about increasing the taxes on land while scrapping the rest. Or even further, probably taxing property (a skyscraper doesn't have too big of a land footprint). A few questions I have about this: How do you tax companies which rent their office/production space? Isn't taxing land punishing companies planning for growth? It is not uncommon to buy/rent sp…

Isn't land already taxed?

This very much depends on your jurisdiction - the UK has local government taxation which is very roughly based on house size or commercial building use, and is capped so everything above a large family house ends up paying the same rate.

I'd be quite happy swapping the transaction tax and council tax for an ongoing property value tax, but I also know that wouldn't be very popular in the UK which is so dependent on house price inflation.

How do you tax companies which rent their office/production space?

You don't, you tax the rentier. Whether the property is let or not.

Isn't taxing land punishing companies planning for growth? It is not uncommon to buy/rent spaces which you don't need now but you know will be needed in the future?

The process of "land banking" by e.g. Tesco is controversial in itself, since it potentially results in land and buildings left idle or even rotting while everyone waits for the expansion. It obstructs the use of land by others who want to put it to immediate use.

How do you deal with real estate investors?

Real estate investment is usually heavily geared and pro-cyclical, so I'm quite happy to stick them with a tax bill. Especially if it might prevent another 2008 boom/bust cycle.

It's a form of social engineering, like everything else in the tax code, and requires a bit of attention to detail. How to avoid ruining family farmers while discouraging people from reserving vast areas for sporting estates, for example? What of property-rich but cashflow-poor pensioners (the most common objection)?

Re: Commission says Ireland granted undue tax benefits of up to €13B to Apple

#170

Post by pliny »

blahi wrote: post #137
pjc50 wrote: post #115

Earlier quoted context omitted.

However, the nice thing about land taxation is that hiding the ownership doesn't matter: you can see from the land registry that it's owned by Shady Cayman LLC, but you don't care who they really are so long as you have a corresponding payment to the tax authorities. If they fail to pay that becomes a lien and ultimately reposession.

Isn't land already taxed? I believe it is, so you must be talking about increasing the taxes on land while scrapping the rest. Or even further, probably taxing property (a skyscraper doesn't have too big of a land footprint). A few questions I have about this: How do you tax companies which rent their office/production space? Isn't taxing land punishing companies planning for growth? It is not uncommon to buy/rent sp…

Not GP but:

>How do you tax companies which rent their office/production space?

You don't, you tax whoever owns the land they rent and the landowner will charge rent commensurate with the expenses he incurs (including tax) by owning the land.

>Isn't taxing land punishing companies planning for growth? It is not uncommon to buy/rent spaces which you don't need now but you know will be needed in the future?

This is already the status quo, though, except now you 'punish' corporations and people for succeeding (making a profit on investments, earning a high income etc.). I don't know how to rigorously decide whether it's worse to punish someone for owning land or to punish them for owning things that aren't land, or to punish them for being personally useful to other people (i.e. profiting from their skills and effort rather than from property that is in their name), but intuitively it seems to me that punishing, and thereby discouraging people from being useful is the worst, while punishing people for owning things is not as bad. I'm not sure how society looks when people are adverse to owning land.

>How do you deal with real estate investors?

In what sense would you have to deal with them? Their investments presumably lose most of their value if all present taxes are converted into one (high) land tax.

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