Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

How Apple sidestepped a 2013 crackdown on its Irish tax practices

bbc.co.uk

Post reply on HN
Print view View original

211–220 of 350 posts

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

#211

Post by landryraccoon »

toomuchtodo wrote: post #205
osteele wrote: post #121

Earlier quoted context omitted.

> 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. Another rational choice is to relocate the company, a la Burger King's move to Canada [1,2]. Then the government can counter with tariffs [3,4]. It's a balancing act, though. […

> It's a balancing act, though. At the end of the day, there is no way you as a corporation can entirely subvert a nation state. I find it odd even that rational individuals think its possible against an adversary (typically with effectively unlimited resources) that can tariff you, dissolve your organization, and even jail you.

It's not corporation against nation state, it's nation state against nation state.

I'm pretty sure China would be quite happy if the US punishes Apple. That means that their protectionist policy towards Huawei will be even more effective. It is difficult for me to imagine other nations either not rolling out the red carpet to bring Apple over, or giving virtually tax free giveaways to their own companies to gain smartphone supremacy.

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

#212

Post by landryraccoon »

glenstein wrote: post #69
slavik81 wrote: post #9

Earlier quoted context omitted.

What's your proposed rule that would close the loophole? I don't think it's actually possible.

The Stop Tax Haven Abuse Act would help: https://www.congress.gov/bill/113th-congress/senate-bill/153... Also, as a meta point, since I seem to see these kinds of challenges often: any time a person is put on the spot to name a specific change to a specific provision of law to enact a policy goal, it's probably going to be difficult to immediately give a specific answer. To translate policy into legislation often req…

Won't help against foreign state sanctioned competitors to Apple, e.g. Samsung (Korea) or Huawei (China).

I am sure foreign nations would be quite happy to gain any advantage for their own companies over US corporations like Apple. Personally I would prefer that the US maintain a technological advantage for as long as possible.

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

#213

Post by barrkel »

the_mitsuhiko wrote: post #41
fleitz wrote: post #37

Earlier quoted context omitted.

The people of Ireland have democracy, perhaps they have different views on taxation than you do. It may come as a surprise to you but some people aren't so greedy as to believe that they are entitled to the fruits of other's labour.

Most Irish citizens had no idea about the extend of this.

I think most Irish people are aware that the primary appeal of the country to multinationals is as a tax-efficient English-speaking common law bridge into the EU, in approximately that order. The specific amounts flowing across the bridge, no, I don't think people are generally aware of the numbers.

But because it is a bridge, we Irish don't really have a strong claim on that money: the revenue was generated somewhere else, and it's going somewhere else, it's just resting in Ireland for a while.

There's a bunch of hypocritical talk from other EU countries criticising Irish tax rates, all the while having lots of carveouts and tax breaks of their own that reduce supposedly high rates to nearly nothing in various deals. For example, France has an effective rate of about 8% on profits for companies in the the CAC40. Luxembourg is much worse, it's practically a tax haven that avoids being listed as such somehow, probably down to location.

In principle I'm in favour of something like the common consolidated corporate tax base. The problem with taxing multinationals comes down to game theory: if there's a common market between countries, there's a race to the bottom in tax rates for hosting multinationals. So there needs to be a pact.

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

#214

Post by evilduck »

nautilus12 wrote: post #85
RingwormOne wrote: post #24

Don't fault corporations for exploiting legal loopholes to save money... They optimize what they must optimize as operating businesses, and if we the citizens want to compel them to do something we must pass the laws necessary to do so... Stop moralizing the behavior of companies. They aren't humans. If you choose not to buy apple products in reaction to their behavior, great. If you want to convince your friends to…

I disagree with this whole heartedly. Laws like this are not deterministic procedures, they are more like best practices. Can you seriously argue that Apple is not a functioning member of society? For many its a daily companion. It should be held accountable to behave like a good citizen within society like everyone else and not find ways to sidestep the law. If society can oust an individual like Weinstein and hold…

Would you accept that everyone in a community be sent a speeding ticket for prior behavior if a road's speed limit was reduced from 45MPH to 35MPH? In spirit, the first speed limit was set for a safety reason right? Clearly everyone disobeyed the spirit of that limit by going faster than 35MPH and necessitating the limit be reduced. Pay up.

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

#215

Post by alasdair_ »

toomuchtodo wrote: post #205
osteele wrote: post #121

Earlier quoted context omitted.

> 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. Another rational choice is to relocate the company, a la Burger King's move to Canada [1,2]. Then the government can counter with tariffs [3,4]. It's a balancing act, though. […

> It's a balancing act, though. At the end of the day, there is no way you as a corporation can entirely subvert a nation state. I find it odd even that rational individuals think its possible against an adversary (typically with effectively unlimited resources) that can tariff you, dissolve your organization, and even jail you.

>At the end of the day, there is no way you as a corporation can entirely subvert a nation state.

There are countless examples of this happening, from the East India Company (who essentially ruled India for a century) to the United Fruit Company to present-day Shell Oil.

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

#216

Post by wildmusings »

canuckintime wrote: post #4
rrggrr wrote: post #2

If passed, and for a brief period of time, Trump's dollar repatriation tax scheme brings home some of the +2 trillion dollars sequestered abroad - including some of the billions Apple has parked offshore. http://www.businessinsider.com/trump-gop-tax-reform-plan-bil... There's something to be said for Apple's efforts to level the playing field against the favorable tax & public policies under which Samsung and Huawei…

Or the US Congress could just change the law, close the loophole and require corporations to bring the money home anyway without any tax holidays...

It seems that you're suggesting that we tax corporations on overseas income, even when reinvested overseas. That would put American companies at an extreme disadvantage compared to those from other countries, by forcing them to pay double taxes, US and foreign corporate taxes, on all income.

The logical solution is to get rid of the corporate tax altogether. The only reason why it exists is to be a plank for politicians who want to tax the "greedy corporations." All corporate income is either paid as dividends, paid as salaries, or reinvested. When it is paid as dividends, it is taxed as capital gains. When it is paid as salaries, it is taxed as income. When it is reinvested, it is either lost, or eventually becomes income and capital gains. There is no need to have another layer of taxation that just makes a giant accounting mess and creates all sorts of ridiculous incentives to use tax shelters.

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

#217

Post by mjmahone17 »

jdhn wrote: post #185
madeofpalk wrote: post #162

Earlier quoted context omitted.

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.

You can choose to either take a foreign income tax exclusion (up to the first ~100k earned), and deduct income taxes paid beyond that point (like paying state taxes), or get a credit for foreign taxes paid.

So if you earn less than 100k, you need to file US taxes, but will only pay the foreign tax rate. If you earn, say 200k, then you’ll pay at least as much as the US would have taxed you on that income.[0]

There are still absurd pieces of this law: for instance, if you buy a home using foreign currency, then sell the home for the exact same amount, but the foreign currency became a lot stronger, you owe US taxes on the change in USD to your home’s value.

[0] https://www.irs.gov/individuals/international-taxpayers/fore...

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

#218

Post by toomuchtodo »

alasdair_ wrote: post #215
toomuchtodo wrote: post #205

Earlier quoted context omitted.

> It's a balancing act, though. At the end of the day, there is no way you as a corporation can entirely subvert a nation state. I find it odd even that rational individuals think its possible against an adversary (typically with effectively unlimited resources) that can tariff you, dissolve your organization, and even jail you.

>At the end of the day, there is no way you as a corporation can entirely subvert a nation state. There are countless examples of this happening, from the East India Company (who essentially ruled India for a century) to the United Fruit Company to present-day Shell Oil.

Can you provide an example present day of a company successfully subverting the US government? To my knowledge, they're even pursuing companies successfully outside of their jurisdiction (Kim Dotcom/MEGA).

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

#219

Post by valuearb »

canuckintime wrote: post #4
rrggrr wrote: post #2

If passed, and for a brief period of time, Trump's dollar repatriation tax scheme brings home some of the +2 trillion dollars sequestered abroad - including some of the billions Apple has parked offshore. http://www.businessinsider.com/trump-gop-tax-reform-plan-bil... There's something to be said for Apple's efforts to level the playing field against the favorable tax & public policies under which Samsung and Huawei…

Or the US Congress could just change the law, close the loophole and require corporations to bring the money home anyway without any tax holidays...

We won’t do that because it’s terrible tax policy and would damage this country even more than our current bad corporate tax policy does.

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

#220

Post by valuearb »

toomuchtodo wrote: post #205
osteele wrote: post #121

Earlier quoted context omitted.

> 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. Another rational choice is to relocate the company, a la Burger King's move to Canada [1,2]. Then the government can counter with tariffs [3,4]. It's a balancing act, though. […

> It's a balancing act, though. At the end of the day, there is no way you as a corporation can entirely subvert a nation state. I find it odd even that rational individuals think its possible against an adversary (typically with effectively unlimited resources) that can tariff you, dissolve your organization, and even jail you.

Samsung subverts the tax laws of the US every day, forcing repatriation would just give our foreign competitors even bigger advantages.
Post reply on HN