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Apple must pay 13B euros in back taxes, EU's top court rules

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Re: Apple must pay 13B euros in back taxes, EU's top court rules

#321
post #296
post #287

> Apple, however, said in a statement: "The European Commission is trying to retroactively change the rules and ignore that, as required by international tax law, our income was already subject to taxes in the US." My understanding is that the U.S.A. double-taxes both corporations operating abroad, as well as it's own expats. If this is true, then it's quite the remark to say _the country you're actually in_ is the o…

Expats aren’t double taxed but you need to file tax returns to offset taxable income that’s already been taxed. There are specific agreements to avoid double taxation but it’s unclear/unlikely the IRS are just going to hand back money Apple already paid (it likely falls outside of what’s required in those international agreements). Companies, and people, make decisions based on the tax laws of the day eg deciding to…

> Expats aren’t double taxed but you need to file tax returns to offset taxable income that’s already been taxed. There are specific agreements to avoid double taxation

Glad to hear it, because what Americans told me (that they get taxed for the same money they paid tax on in their host country) is bonkers.

EDIT: Seems there's some disagreement ;) The other commentor echoes what I've heard from Americans living in Europe. Absolute madness. I also heard it's very costly to try and give up your American citizenship, exactly to protect that juicy free tax America gets from it's expats.

> If they can do it to Apple, why not to regular citizens?

They already do. Knowledge worker migrants were promised eight years of tax breaks by the Dutch government, who later changed their minds after those people already moved to the Netherlands.

This isn't even that though, this is the EU saying the agreement made by Ireland with Apple wasn't legal. It's like how they get people who avoid tax by finding loopholes to pay back-taxes once the tax office catches them (yes, this happens too).

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#322
post #50

I found some rather troubling aspects within the ruling itself: 1. Retroactive application of arm's length principle The Court's reliance on the arm's length principle, despite acknowledging it's not required by EU law, is problematic. As stated in paragraph 124: > "Article 107(1) TFEU gives the Commission the right to check whether the level of profit allocated to such branches... corresponds to the level of profit…

There's not much uncertainty for business really. If you're pulling the moves that Apple and other companies pull to "optimize tax", then you are with 100% certainty trying to game the system and violating the spirit of the law.

[flagged]

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#323
post #251

Even if this sounds like a huge fine, this is effectively meaningless, even if they end up paying it. 13 billion, for a company with market cap of more than 3 trillion is around 0.4% of their cap. Until these fines become meaningful, companies will just continue breaking the law and asking for forgiveness later, as the changes to their market cap can offset this fine in hours.

Big tech companies can absorb these penalties without a major dent in their finances, and as you pointed out, sometimes the market value can rebound quickly, negating the effect of the fine.

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#324
post #69
post #50

I found some rather troubling aspects within the ruling itself: 1. Retroactive application of arm's length principle The Court's reliance on the arm's length principle, despite acknowledging it's not required by EU law, is problematic. As stated in paragraph 124: > "Article 107(1) TFEU gives the Commission the right to check whether the level of profit allocated to such branches... corresponds to the level of profit…

I find it interesting how in american corpspeak "uncertanty" pretty much always means "our lawyers can't find a way to avoid this law without getting caught" ^^

Well yeah. The prime way they avoid the law is compliance. You would also be pretty pissed off if you couldn't avoid a law fining you for something you couldn't avoid.

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#325

Earlier quoted context omitted.

They aren't being punished, they are simply being told to pay the tax that Ireland illegally said they didn't have to pay.

That's a distinction without a difference. Presumably, if Ireland hadn't offered this deal, Apple would have done their business somewhere else. Sure, they may have paid some other country more taxes, but potentially less taxes than what they now owe Ireland. Apple isn't blameless here, but it definitely kinda feels like they got a little bit defrauded by the Irish government who now essentially is getting rewarded w…

Apple is a lot worse than merely 'isn't blameless'. They knew perfectly well what they were getting into and I'm confident that the current judgment would have been a scenario that their lawyers would have explored.

I'm sure that if Apple thinks that they have been hard done by that they could sue the Irish government for damages in the Irish courts.

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#326

It would just be really good if companies stopped avoiding tax. Most countries are already pretty much bankrupt - it's worth thinking about for every debt (US National Debt is $35.35 trillion!!) there is a rich person on the end of it with the loan as an asset earning interest. If companies avoid tax and rich people avoid tax it means more tax for normal people who work for a living.

While there is lots of tax fraud, I feel it’s probably a drop in the bucket. Countries will have to either cut back on spending or borrow until they collapse under the weight of their own inept budgeting.

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#327
post #268

Earlier quoted context omitted.

Kind of. It's already prohibited, depending on what you mean. It would be legal to say all companies can have a tax break if they hire X people in Ireland. It's not legal to give the tax break to one company and deny it to another.

It does feel a little weird then that Apple is being fined here then? It seems like Ireland did the thing that's against the rules by offering the deal, not Apple? Obviously they worked on it together, but it feels odd that Ireland has now essentially gotten all the benefits of offering this illegal deal by having Apple do business there and now also gets all the back taxes that Apple probably wouldn't have paid to I…

It's simple, EU law says Apple had to pay taxes at that time. Apple's ignorance of EU law is not an excuse, this doesn't work for individuals, why should it work for big multinational companies? Ireland doesn't have the power alone to overturn these kinds of laws, unless, of course, they decide to leave EU.

Apple's decision to put their trust completely in Ireland officials and sidestep the EU is their own mistake. Reminds me of when Trump tried to arrange a trade deal with Germany without EU, which was impossible.

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#328

Earlier quoted context omitted.

It does feel a little weird then that Apple is being fined here then? It seems like Ireland did the thing that's against the rules by offering the deal, not Apple? Obviously they worked on it together, but it feels odd that Ireland has now essentially gotten all the benefits of offering this illegal deal by having Apple do business there and now also gets all the back taxes that Apple probably wouldn't have paid to I…

> it feels odd that Ireland has now essentially gotten all the benefits of offering this illegal deal by having Apple do business there and now also gets all the back taxes that Apple probably wouldn't have paid to Ireland if they hadn't gotten the deal. Yes, there's a widespread view in Ireland that this was the best possible outcome: be seen to fight tooth and nail to prevent collecting the taxes, but get them anyw…

Sure, I'm not saying this is going to be a likely fraud, but there's much more subtly illegal ways to offer stuff that may be worth the risk for a company and then the government then lobbies via backchannels for the EU to find it illegal.

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#329
post #69

Earlier quoted context omitted.

I find it interesting how in american corpspeak "uncertanty" pretty much always means "our lawyers can't find a way to avoid this law without getting caught" ^^

EU companies dodge and bend rules all the time. See: VW, AirBus, etc.

It is no surprise culturally that they do. When innocence/technical compliance with the law is no defense against the law why bother?

Re: Apple must pay 13B euros in back taxes, EU's top court rules

#330

Earlier quoted context omitted.

It does feel a little weird then that Apple is being fined here then? It seems like Ireland did the thing that's against the rules by offering the deal, not Apple? Obviously they worked on it together, but it feels odd that Ireland has now essentially gotten all the benefits of offering this illegal deal by having Apple do business there and now also gets all the back taxes that Apple probably wouldn't have paid to I…

> it feels odd that Ireland has now essentially gotten all the benefits of offering this illegal deal by having Apple do business there and now also gets all the back taxes that Apple probably wouldn't have paid to Ireland if they hadn't gotten the deal. Yes, there's a widespread view in Ireland that this was the best possible outcome: be seen to fight tooth and nail to prevent collecting the taxes, but get them anyw…

An interest free loan for years for 13 billion isn’t too bad!
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