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How Apple sidestepped a 2013 crackdown on its Irish tax practices

bbc.co.uk

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Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#181

Post by cmiles74 »

__blockcipher__ wrote: post #157
cmiles74 wrote: post #130

Earlier quoted context omitted.

I don't believe that this is accurate. Apple believes they are in compliance and at this time it appears the US federal government agrees. If the government was to disagree, they could take action and force Apple to comply with the existing tax laws. Apple would have their day in court and precedent would be set. Should Apple win that case, then we'd need to look into creating new laws. I am not convinced that new la…

Pure foolishness. The law says “if you bring your foreign-earned profits abroad, you must pay taxes”. (I left it vague because I’m not an expert but my understanding is Apple would be responsible for around a 30% or higher tax rate). Apple says, “okay we’re not going to bring the money back at that rate. Instead we’ll leave it invested in liquid assets abroad and take on cheap debt in the US to fund our share repurch…

I don't think it's at all that straightforward. Apple has assigned intellectual property to their subsidiaries in Ireland and has used that as a way to direct profits out of the US. Is that legal? I am not an expert, but surely it is not straightforward.

Once profits collect in Ireland, Apple moves the profits to it's "head office", which not only is not in Ireland, it's not physical in any way. Thus they avoid the bulk of Irish taxes. The EU is suing Ireland and seem fairly serious, at least in this case it looks like Apple will pay some of the taxes, eventually.

https://www.reuters.com/article/us-eu-apple-taxavoidance-cou...

Is this the only way they are avoiding taxes? I strongly suspect it is not and that they are breaking the law in more than one case.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#182

Post by __blockcipher__ »

anigbrowl wrote: post #134
JumpCrisscross wrote: post #19

Earlier quoted context omitted.

> we should simply make large corporations like Apple actually follow the existing tax laws Apple is in compliance with our tax laws. The laws, not Apple, are the underlying problem.

Apple spent ~$3.5 million on lobbying in the first 6 months of the Trump administration: https://9to5mac.com/2017/07/21/apple-trump-lobbying-increase... How many times do we have to reiterate the point that large corporations and the people who own them spend a fortune on lobbying sitting politicians and bankrolling their election campaigns, and that the controls on such spending limits have been systematically disma…

$3.5 million is absolutely nothing. Compare that figure to Apple’s yearly FCF (free cash flow)...

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#183

Post by nautilus12 »

twblalock wrote: post #167
nautilus12 wrote: post #153

Earlier quoted context omitted.

Im not a legal person so I apologize, but how does intent play into this then. If Im climbing with someone and I accidentally drop them and they die, then I have to show that my intent wasn't to murder them right? Can't you make the same argument here, the crime is that apple didn't pay the full taxes it owed the government don't they still have to prove that their intent wasn't dodging taxes?

If the state charges you with murder, the state has to prove beyond a reasonable doubt that you intended to kill. You don't have to prove anything. And that's the way it should be.

So why can't this be a scenario of the state charging Apple with tax evasion and the state proving beyond a reasonable doubt that this was their intention?

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#184

Post by x220 »

patresh wrote: post #110

Why is it that criminal laws are judged on a case by case basis and tax code is so inflexible? For instance, in states that allow shooting trespassers, you could buy a patch of sidewalk and shoot anyone that walks into it. I doubt that you would get off scot-free since in criminal law you always consider context. Why is that notion of context impossible to include in the tax code and leave some interpretability to th…

Criminal cases in nearly all jurisdictions in the United States are not judged on a case-by-case basis. They are judged on precedent.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#185

Post by jdhn »

madeofpalk wrote: post #162
cmiles74 wrote: post #144

Earlier quoted context omitted.

Yes, the US taxes the income of citizen's that live and work abroad. Those citizens' are taxed twice: once by the country they live in and again by the US[0]. From the article: "If you are a U.S. citizen or resident alien, the rules for filing income, estate, and gift tax returns and paying estimated tax are generally the same whether you are in the United States or abroad. Your worldwide income is subject to U.S. in…

You get an offset though for the foreign tax you paid, right? So you aren't taxed twice as much as you are just taxed at the higher rate of the two countries.

Up to a certain point. Above that point, not only do you have to pay the tax to the foreign country in which you earned the money, but you also have to pay American income tax on that as well. I believe the cutoff is around $90,000.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#186

Post by joering2 »

abalone wrote: post #177

This is all a bit misleading. The general tone of the article is "Apple's not paying their fair share in Europe." The bigger context here is these are taxes owed mostly to the United States. That's where most of Apple's value-creating work is done and that's traditionally how international tax law works. What's happening is, Apple is parking funds in offshore tax havens while lobbying Congress to lower the tax rate f…

Its still highly questionable.

Try it at home: don't pay taxes for 10 years because YOU decide they are too high and tell Congress you won't pay until Congress will lover your taxes.

And make sure you don't have any animals at home and don't forget to turn on your surveillance cameras, because after third visit from IRS, local SWAT team is coming up with flash-grenades and fully automatic ARs.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#187

Post by charlesdm »

abalone wrote: post #177

This is all a bit misleading. The general tone of the article is "Apple's not paying their fair share in Europe." The bigger context here is these are taxes owed mostly to the United States. That's where most of Apple's value-creating work is done and that's traditionally how international tax law works. What's happening is, Apple is parking funds in offshore tax havens while lobbying Congress to lower the tax rate f…

> that's traditionally how international tax law works

No, that is how US tax law works. Most jurisdictions traditionally do not tax foreign earnings, but exempt them.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#188

Post by anigbrowl »

__blockcipher__ wrote: post #170
anigbrowl wrote: post #136

Earlier quoted context omitted.

Prove it. I think companies like being in the US because of the sophisticated capital markets, strong and predictable legal environment, and deep pockets of American consumers. I'd like some evidence instead of hyperbole.

How about you provide the evidence? If US makes it defacto illegal to operate internationally as a US-based company, the US will lose its economic moat within a matter of decades [citation needed, I know] I’m not a tax expert but IME the people who are blaming Apple don’t know what they’re talking about. Only the US has such an insane attitude towards international profits. And remember that there’s no loophole to cl…

The person making the claim has the burden of proof.

Maybe repeating a string of specious arguments that have already been debunked or refuted elsewhere in the thread isn't the best approach for your brand-new HN account.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#189

Post by _0ffh »

DigitalJack wrote: post #94
vidarh wrote: post #28

Earlier quoted context omitted.

The thing, though, is that their main "loophole" currently consists of "play chicken with the government until someone passes a tax holiday". If you make it clear there will never be a tax holiday, but that you will instead keep adjusting the rules to go after earnings withheld abroad, at some point the rational choice for them will be to bite the bullet and repatriate the income. As it is, the most rational choice f…

In this case it's not a loophole in American laws. It's a problem with European and Carribean laws. This money was earned abroad. Blame the Irish, and now whatever this Jersey Island place is. The EU made a move to close the loophole, apple found another. I suppose there are loopholes with them selling IP assets to subsidiaries. But that's a different loophole than the one with them floating money around different co…

It's a British crown dependency, and afaik not the only tax haven under British rule. And it seems like there's no much the EU will be able to do about those.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#190

Post by namelost »

lbotos wrote: post #47
DINKDINK wrote: post #31

Point of debate: Why should Apple have the US government lay claim to the revenue/profits that it generates in non US countries? From the article: "This allowed Apple to funnel all its sales outside of the Americas - currently about 55% of its revenue - through Irish subsidiaries that were effectively stateless for taxation purposes, and so incurred hardly any tax." If you support the taxation, do you also support th…

Doesn't it already? I've been under the impression that is one of the big "things" about being an American. You will always pay taxes to the US: "If you are a U.S. citizen or resident alien, the rules for filing income, estate, and gift tax returns and paying estimated tax are generally the same whether you are in the United States or abroad. Your worldwide income is subject to U.S. income tax, regardless of where yo…

For the US to start taxing Apple's foreign income abroad is not like taxing an American living in Ireland (and even that is crazy). It's like if the US started taxing an Irish person in Ireland[1].

However obvious it is that EU Apple is a sock puppet of US Apple, directly imposing taxes on foreign companies operating in foreign countries would be met with retaliation. It is not a smart nor a profitable trade policy.

[1] This actually does happen: https://en.wikipedia.org/wiki/Accidental_American

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