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

rte.ie

311–320 of 436 posts

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

#311

Even with these baby steps, I like to see that the EU is unifying its corporate tax code. Of course, we do not need to worry about Ireland, Great Britain already made sure their position as English entrance to the EU will stay strong regardless of tax-breaks. The Netherlands are naughty, too, due to a strange coincidence Ikea Germany has to pay fees of exactly its profits to Ikea Netherlands each year. I think the bi…

Just to be fair: 1. Netherlands profit tax rate is 20%-25%, where Germany: 30-33%. Companies, may take advantage of those difference, but it less obvious evasion than paying 0.005% rate in some tax heaven. 2. Ikea Netherlands has several offices and a lot of employees in Netherlands. They likely provide some services to Ikea Germany. 3. Licensing cost, may have profit component. E.g. I can sell you the franchise for…

> 1. Netherlands profit tax rate is 20%-25%

Not for foundations [0]. This is not about some procentual differences, it is a big loophole in the Dutch tax code, Ikea benefits from.

https://en.wikipedia.org/wiki/Stichting_INGKA_Foundation

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

#312
post #178

I only wish that countries would compete for people the same way they compete for businesses. If they were to provide the best services, quality of life, in exchange for the lowest income taxes. That way people would move there and companies would follow. Wishful thinking?

They do. Why do you think New York City and London get to tax at the rates they do?

Taxes (at least personal taxes) are a user fee. Every time an employee snuffs at an offer in Missouri or Bangladesh, they are implicitly signalling a preference for quality-of-life elements.

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

#313

Earlier quoted context omitted.

VW cheated, but the bigger moral problem and the underlying topic is not the cheating but the pollution that was hidden by it. And suggesting that VW is polluting more than US brands is just nuts. Edit: Just wanted to make clear, that of course the cheating should have totally been caught in Europe earlier. The thought that the US is not biased with its domestic brands just made me chuckle.

>The thought that the US is not biased with its domestic brands just made me chuckle. Who suggested that, or for that matter who suggested that "VW is polluting more than US brands"? I know I didn't.

> Who suggested that, or for that matter who suggested that "VW is polluting more than US brands"?

So we can all agree, that governments favouring their big domestic companies is not just an EU thing. You criticized the EU for going after Apple and not VW, I made clear that the US is going after VW and not GM.

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

#314
post #82

Earlier quoted context omitted.

Shouldn't Ireland also take the blame here? If not, this sets a dangerous precedent for future governments who can sek companies to set shop but then back out once courts rule against. I mean, Ireland here comes out with no culpability.

To whom should a country and its taxpayers be culpable in this situation? What would be the appropriate form of punishment?

[deleted]

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

#315
post #289

Earlier quoted context omitted.

How to counter this: Just regulated the transfer of IP rights. If you sell say a patent portfolio for $50m to your British Virgin Island subsidiary, and then make $20bn in profits in the decade thereafter on that BVI sub, it appears the IP transfer was waaaaay below market value. And should retroactively be taxed in the US where we engineers had developed that stuff in the first place. Problem solved. US tax base res…

Let's imagine an honest tech company that buys a 100 patents each year for 10 years. As usual : 90% of them and up being useless. 9.9% of them allow to make a good product that sell well and keeps them afloat. And one of those ends up being ground breaking pushing the company forward, allowing major innovation in their product line. In the current situation, the company placed a bet on those patents. They took risks,…

Which honest company buys 100 patents a year and is either not flush with cash or patent troll (or both)?

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

#316
post #289

Earlier quoted context omitted.

How to counter this: Just regulated the transfer of IP rights. If you sell say a patent portfolio for $50m to your British Virgin Island subsidiary, and then make $20bn in profits in the decade thereafter on that BVI sub, it appears the IP transfer was waaaaay below market value. And should retroactively be taxed in the US where we engineers had developed that stuff in the first place. Problem solved. US tax base res…

Let's imagine an honest tech company that buys a 100 patents each year for 10 years. As usual : 90% of them and up being useless. 9.9% of them allow to make a good product that sell well and keeps them afloat. And one of those ends up being ground breaking pushing the company forward, allowing major innovation in their product line. In the current situation, the company placed a bet on those patents. They took risks,…

You got this wrong. My point is to not allow to sell IP from the US Inc to the British Virgin Island subsidiary Ltd for a handful of dollars, and deprive the US taxman of billions of earnings. That "ground breaking product" was developed in the US, thus the profits and taxes should be made there.

I love US companies making boatloads of cash. I just hate them to get around paying normal taxes here.

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

#317
post #307

Earlier quoted context omitted.

> The laws are designed to make the extortion impossible. If one state isbn't allowed to undercut another for an individual company then the "or we'll take our business elsewhere" question isn't possible. Those are EU laws. Apple could have taken their business anywhere else, including outside EU where such laws don't apply, and a country could undercut Irish taxes. That said, I'm not against an international agreeme…

> Apple could have taken their business anywhere else, including outside EU where such laws don't apply, and a country could undercut Irish taxes. Yes, Apple could do that. But then they'd have to pay EU customs and other costs that aren't applicable when you do business inside the EU. They choose to be inside the EU for a reason, and they should pay accordingly.

>Yes, Apple could do that. But then they'd have to pay EU customs and other costs that aren't applicable when you do business inside the EU.

That's orthogonal to the argument though. Just another tradeoff to consider in their negotiation.

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

#318

What Apple, Amazon, Google, Microsoft, and most other big US company do is the so called "double Irish"[1]. Essentially is a clever way of using two quirks of some EU countries loopholes in tax laws, from treating IP licensing fees (of course the brand and intellectual IP is owned by a British virgin island tax haven, where else could this stuff be created/invented), and the net result is that Apple et al end up payi…

>And with another quirk - this time in US tax laws - the do not even have to pay taxed in the US on those earnings, as they have not repatriated the funds. This is not a 'quirk' as you think. No country in the world, other than the US, tax their corporations on already taxed profits in a different jurisdiction. This actually ends up hurting the US because corporations cannot repatriate already-taxed funds without bei…

Just like individual income tax for expats corporations only pay the difference between their foreign tax liability when moving funds to their US-based sister or parent companies, last I checked.

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

#319
post #304

Earlier quoted context omitted.

>Dude, can I politely ask you to increase the amount of commas and periods you use? Otherwise you're really hard to follow :) My english teacher flashback: Long sentence -3 pt. >That's not really the case. In fact, in a lot of sectors purely-national players are now the exception, not the rule. You have Portuguese building companies winning UK contracts, and French companies outsourcing to Czech companies. All that w…

>Poland, Denmark, and the Eastern/Baltic states are really lucky that they held their currency. Poland will have to join the Euro or leave, eventually - that's what the treaties they signed force them to do. Considering their relationship with the UK, I think the "leave" option is pretty realistic at this point. > the EU is explicitly "anti-federation" at least on paper No, the EU is about "ever closer union". The ma…

>Otherwise we'd have kept the Common Market we had in the '80s, with all the instability that the multi-currency setup brought. For all its faults, the Euro kept inflation and borrowing rates extremely low and stable for almost 20 years now. The minute we manage to disentangle public-debt markets from nationalistic sensibilities, we are golden.

Again that's your "opinion" or ideal to be more exact, the facts on the ground that the EU was established on the grounds that the sovereignty of it's member states will be maintained at virtually every cost. This is why there is so much contradiction for example each member state has it's own foreign policy but the EU as a whole also has one, on many occasions especially in regards to polarizing subjects the EU foreign policy and statements contradict the ones of individual member states.

>No, I don't think so. States do suffer a lot even in the US setup. As I said, the difference is that at the top you have someone who cares deeply about electoral colleges, especially in marginal states. In the EU there is nothing of the sort, so all pressure has to come from coordinated alliances between member states in the Council.

The states in the US are the legislative body which also holds the federal budget, oddly enough if you take the US federal model then states have more "sovereignty" in many aspects as well as more support and political influence over the federal government.

>The FED looks at the US economy as a whole and does what it needs to do to keep the overall system afloat; if that means Alabama gets screwed, so be it. That's also what the ECB does, more or less.

You are taking my analogy into the wrong direction. The FED would not intervene in the case of California which is exactly what the ECB should have done in the case of Ireland, but it didn't it threatened to shut down their banks and cut them off from the payment system, the same threat was also issued to Greece. This is no more in the mandate of the ECB than it is the mandate of the FED and that was exactly my point if the FED would act like the ECB, Congress would've have burned it to the ground, and if would not stop there.

>In fact, EU states have a nuclear option that US states don't: they can leave. Greece could (and IMHO should) have left, but they came to the duel underprepared and eventually blinked first. Ireland is not in that position because it relies too much on its status as "tax haven cum operational base" for companies entering the EU market. So you can't leave and you can't keep being a tax haven, but if you play fair you can keep all you got and keep building from there.

Article 50 is not a realistic option, it also has nothing to do with how the EU and ECB policies are applied in reality, the fact that you suggest that as an option speaks about the general attitude problem of many people who see the current version of the EU as a stepping stone to anything but a complete catastrophe.

If the EU does not do a complete 180 on it's current policies it would just continue to do more and more damage not only to it's member states but to whatever is left of the idea that it can be more than a shared market and now a concrete anchor around your ankles unless you are in the G20, and considering the current state of affairs in the G8.

I don't object in principle to the idea of a federated Europe (If I were a European national I would strongly object however), but I just don't see it happening and the current state of the EU drive it further and further away, it's policies are destructive and they breed contempt. If the EU is to become a federation it cannot go on as the Franco-German conglomerate while being indecisive and contradictive.

You can't force countries like Ireland and Greece to swallow it and say I know it's hard now but in 10-15 years when everyone's forgotten about it we might start thinking about federalization again and in 2078 we'll "pay you back".

This doesn't work like that, there is absolutly no political capital for federalism in the EU currently the likelihood of it falling apart completely which is slim as it is, is still considerably higher than it becoming a federated union.

>Most EU states say they don't, but in practice they do. It makes life easier for everyone, keeps the peace, and protects the block from US/Russian/Chinese power. There will always be critics, but hey, that's life.

Most voters within the EU member states do not want federalization and they want their national sovereignty and identity kept as it is, in the past few years it's even going completely the other way. Federalists within the EU exists, but they exists within the ranks of the elites, a lot of them are unelected Eurocrats that while hold a lot of power within the EU do not have much power in individual states. There isn't a single member state where this is a popular idea, in most of them even in Germany it is political suicide to even speak about federalization.

>Actually Luxembourg was in a pickle not long ago, because of their tax affairs. The difference is that Luxembourg will never be a competitor to large countries "where it matters", so it's given a bit of leeway; plus, its representatives are first-class and know how to play the game.

Luxembourg is protected by Juncker even tho the EUP is in brussels all the important EU institutions and the money is in Luxembourg the EUP is more or less of a "joke" since The Council of Europe and the Commission do most of the "grownup" work. If the EU Parliament had power it would look differently rather than being overly representative of fringe elements and political laughing stock that wouldn't get elected nationally.

>Norway has the same population

Israel has 8M Turkey has 75M What's the point? Norway isn't in the EU, norway isn't a hub for multinationals, norway is a very rich country due to nationalized natural resources and a very smart investment portfolio.

>Actually, Norway has 5M and Ireland 6+M

No the Republic of Ireland, hence Ireland in this context has under 5M people (4.5-4.6 to be exact), Ireland as a geographical construct has about 6M people but this includes the 1.8M residents of Northern Ireland which are British nationals at least for the time being.

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

#320
post #306

Earlier quoted context omitted.

Fair enough, I don't keep up with Californian affairs that much. Still, I don't believe the FED ever considered substantially altering its monetary policies to suit a given state budget. Am I wrong?

> Still, I don't believe the FED ever considered substantially altering its monetary policies to suit a given state budget. Not only doesn't it, but monetary policy isn't a suitable tool for that anyway. Even for the federal budget; in fact, one of the major reasons for independent central banking is to provide assurances to the private economy, currency users, and, particularly, those financing government debt that…

Which is exactly my point, the FED would not have gotten into this mess, and the ECB also shouldn't have.

The ECB was out of line not only in regards to common sense but in it's essence in regards to it's mandate.

The FED would not have have messed with the state notes, and it would surely not have threatened to shut down it's banks by saying it would not guarantee their liquidity and cut Cali banks out of the dollar payment system if Cali dares to allow it's private investment banks and bond issuers to declare bankruptcy.

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