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Apple has €13bn Irish tax bill overturned

bbc.com

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Re: Apple has €13bn Irish tax bill overturned

#171

Post by m12k »

netcan wrote: post #145
soneil wrote: post #125

Earlier quoted context omitted.

It sort of is. And isn't. It's a helluva mess we've got ourselves into. Ireland has built its modern economy on being attractive to multinationals. And it's worked. 10 MNCs alone pay 40% of all tax revenue in the country. They've brought jobs and wealth to a country that was previously big in dairy & emigration. For the generation above me, the career path was study, leave, earn your money elsewhere - and perhaps com…

Is it a race to the bottom though? I mean, a race to the bottom in the normal sense is cutting taxes or spending money on attracting these companies. We help these companies evade other countries' taxes, not our own. Also, officially, the entities involved in the tax evasion are not related to the entities that actually employ people. Would Google move it european customer support offices without this tax deal? Theor…

> Is it a race to the bottom though?

It's a race to the bottom as soon as any of those other countries undercut your tax rate to try to steal the MNCs back. Most countries realize that isn't sustainable, so for now it hasn't happened.

Re: Apple has €13bn Irish tax bill overturned

#172

Post by csunbird »

arrrg wrote: post #113
csunbird wrote: post #29

Earlier quoted context omitted.

Meanwhile, the working people in Germany are paying 20 percent to 35 percent income taxes in their salaries.

The range starts at six percent (assuming full-time employment and minimum wage, it can drop lower if you are working part-time). It’s at 15 percent for people earning the median wage (€3,300), meaning half of all Germans pay 15 percent or less of their salary in income tax. Your range if very far removed from reality. (It is true, though, that for very high incomes 35 percent aren’t the ceiling, that’s somewhere in…

Well, adding mandatory payments/taxes such as, social security, health insurance (%7.45 + %7.45 paid by employer), unemployment insurance and solidarity tax, pushes it to 20 percent - 35 percent area, based on your tax class. I am not even talking about the church tax if you are religious. In my opinion, I do not see any difference between income tax and the mandatory taxes.

Re: Apple has €13bn Irish tax bill overturned

#173

Post by majidazimi »

thehashrocket wrote: post #165
mrep wrote: post #150

Earlier quoted context omitted.

Why is that? Like, on the US west coast, ballooning home prices makes sense because their cities are in valleys with a fixed amount of land, but munich looks like it has a bunch of farmland around it that could be converted into housing increasing supply and thus decreasing prices. This coming from someone in chicagoland which has 9.5 million people but housing isn't crazy because the metro area sprawls 30-40 miles o…

If we keep plowing over farmland to build suburbs where will the farming get done?

Build taller. Skyscraper has been invented long time ago.

Re: Apple has €13bn Irish tax bill overturned

#174

Post by labcomputer »

m12k wrote: post #94
logicchains wrote: post #88

Earlier quoted context omitted.

>The US experienced massive growth in the 50s and 60s while having very high tax rates. The effective rate actually paid by the top 1% was around 42%, which is not much higher than now: https://taxfoundation.org/taxes-on-the-rich-1950s-not-high/ . . The US had also emerged as pretty much the only unbombed industrial country after a global war, giving it a significant advantage. >so thoroughly debunked by now Debunked…

> The US had also emerged as pretty much the only unbombed industrial country after a global war, giving it a significant advantage Ding-ding-ding - you hit the nail on the head! The US' competitive advantage and special position in the world, including all those fortune 500 companies, doesn't come from its special adherence to laissez-faire capitalism, it comes from other historic advantages. The supply-side trickle…

> Ding-ding-ding - you hit the nail on the head!

Meta-comment: I find this style of argument (make one claim, have the claim debunked, make a different claim and say "see I was right") to be very annoying, and I wouldn't mind if it disappeared from HN.

Re: Apple has €13bn Irish tax bill overturned

#175

Post by s_dev »

dgellow wrote: post #10

The commission can still appeal the decision.

Given this disastrous result for the Commision -- I don't think they will but I'm not sure.

They'll be accused of wasting time and doubling down will further enrage EU citizens unless they can ensure a favourable outcome.

Re: Apple has €13bn Irish tax bill overturned

#176

Post by DiogenesKynikos »

m12k wrote: post #77
logicchains wrote: post #38

Earlier quoted context omitted.

>Transfer pricing and tax havens are draining money out of the economies of most European countries, breaking the virtuous cycle where consumer spending also leads to salaries, taxes and more investment in the community, to keep the economy going - instead we have a shrinking middle class, as the fuel is drained from the engine. An alternative interpretation is that the high degree of taxes and regulations in Europe…

The US experienced massive growth in the 50s and 60s while having very high tax rates. The US, until recently had a higher corporate tax rate than many European country - the latest US tax cuts brought it down to the same 21% that my native Denmark has. I'm sorry, but this 'deregulation and low taxes will fix everything' myth has been so thoroughly debunked by now that I'm sad to see it rearing its ugly head in an ot…

> And China, if anyone, has shown how protectionism, and making sure outside companies can only reach your internal market if they play by your rules, and favoring national companies over international ones, is a winning strategy in the 21st century.

The winning strategy depends very much on what stage of economic development a country is at. Developing countries often benefit from some level of protectionism (this is the "infant industries argument," which Alexander Hamilton proposed), but developed countries benefit much more from lower trade barriers. In 20 years, it will be China that is pushing for developing countries to lower their trade barriers.

Re: Apple has €13bn Irish tax bill overturned

#177

Post by joejerryronnie »

jonfw wrote: post #107
myspy wrote: post #62

Earlier quoted context omitted.

As long as there is shareholder before stakeholder, I don't see this as a good argument. Take Amazon. Employees in warehouses are low wage and hire and fire jobs. The CEO is getting richer and richer, not everyone is profiting as well as it could be. What Europe would need is to excel in computer science as well as design and engineering. The topic is pretty lacking here and would need a push. The result would be com…

I feel like this argument lacks a full understanding of what 'net worth' even means. Bezos is not taking enough cash from Amazon to be even remotely relevant to what they pay their warehouse workers. His cash compensation in 2019 was 1.6 million. Not sure how that reflects in 2020, 2021, but the point is that Bezos is only absurdly rich in theory He is theoretically worth hundreds of billions- but his actual consumpt…

Nobody who argues “Billionaires are bad for society” has an understanding of net worth - or worse, they are acting blatantly disingenuous in order to further their political viewpoints.

Re: Apple has €13bn Irish tax bill overturned

#179

Post by secondcoming »

traveler01 wrote: post #116
logicchains wrote: post #88

Earlier quoted context omitted.

>The US experienced massive growth in the 50s and 60s while having very high tax rates. The effective rate actually paid by the top 1% was around 42%, which is not much higher than now: https://taxfoundation.org/taxes-on-the-rich-1950s-not-high/ . . The US had also emerged as pretty much the only unbombed industrial country after a global war, giving it a significant advantage. >so thoroughly debunked by now Debunked…

These people should look at Portugal. One of the highest taxers in Europe and our economy is crap. The middle class is basically paying for the rich and poor and they don't have money to spend on the economy. We can't support our companies because their products are actually more expensive than outside products (companies pay a lot of taxes too). It's more than known by every good economist that overtaxing isn't good…

There was talk in at least the London tech scene two or three years ago about Lisbon becoming some sort of tech hub. (Personally, I'd love to move there but I'd have to learn Portuguese) But some companies that did try Lisbon out seem to have pulled back. Last I heard it a large reason was because the 'work ethic' of the Portuguese left something to be desired compared to London.

Re: Apple has €13bn Irish tax bill overturned

#180

Post by pwinnski »

negrit wrote: post #136
nodamage wrote: post #120

Earlier quoted context omitted.

There's an argument to be made that since Apple is a US company, ultimately their revenue should be taxed in the US. And ultimately that is what happened: the money Apple made outside the US was eventually taxed when they repatriated it into the US. https://www.wsj.com/articles/apple-to-pay-38-billion-in-repa...

I'm pretty sure Apple has an entity in Europe therefor the money this entity makes in Europe should be taxed in Europe.

That is the other argument, and definitely makes sense, but that's also where things get complicated.

Normally you tax profits, which are gross revenue minus cost of goods sold (and yeah, I'm oversimplifying a bit). But in Europe, Apple has only profits, no cost of goods sold at all, since the costs are incurred in the USA. This would seem to lead to super-high taxes everywhere else, where profits are close to 100%, but huge losses in the USA, where the costs for the whole world aren't met by enough gross revenue to cover them.

To avoid that, the European entity takes on a share of the costs by "buying" from the USA entity. And that's where the games come in. What are they buying? The physical goods? Are what markup? Are they also buying the advantages that come from the Apple name and logo?

They can basically set the cost of that IP to whatever they want, and therefore show as much or as little net profit as they choose. Which is what they've been doing. Again, oversimplifying a bit, they recorded all European revenue through Ireland, and set the cost of product + IP + ad share + everything else so high that the net profit was very, very, very low, and sad that very, very, very low number is what they had to pay taxes on.

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