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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

#431

Post by Already__Taken »

pembrook wrote: post #257
elAhmo wrote: 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.

Market cap is the theoretical value of all the company’s future growth/cash flows brought forward to today. It’s speculative, and fluctuates with the stock price. Tax bills have to be paid in cash, not stock. A better analogy is to simply look at Apple’s net profits, since that’s where the money will come from. $13B is not nothing, even for Apple.

top ai result just said apple has 47 billion cash so 27% sounds like quite a fine.

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

#432

Post by hnbad »

ko27 wrote: post #348
dotancohen wrote: post #336

Earlier quoted context omitted.

In the case of conflicting laws, who prevails? If the Irish pass a law that Apple can not pay certain taxes, does that not override EU law? Usually in cascading situations, the more local entity wins, n

If there is a legal conflict, EU law trumps all, the same way federal law trumps local law in US. The highest court is always an EU institution. EU countries give up part of their sovereignty in specific legal areas, like market competition regulations. They can always leave if they want.

This depends, though. The EU does not have laws covering everything that national or local law might cover in its member states. In many cases the EU court of law is more like the US Supreme Court in that it is more about establishing whether a given legal decision is compatible with the basic law (e.g. human rights). It's more about setting the boundaries within which member states can make their own laws. So national law might say "X is illegal" and EU law might say "nations can say X is illegal" (or that they can't).

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

#433

Post by Supernaut »

lucianbr wrote: post #403
Supernaut wrote: post #277

Earlier quoted context omitted.

VAT is a tax paid by the consumer, not the manufacturer. If you buy an iPhone, it's you that pays the VAT on it, not Apple.

All the money Apple gets come from customers, no? All of it. Do they print their own dollars or something? Are they subsidized by governments? Do the dollars that make up the profits, and the dollars that make up the taxes on profits, come from somewhere else than the dollars that make up the VAT?

I gather from your disdainful tone that you think you've just schooled me on something really fundamental, but the point you're trying to make is unclear to me. If you're asserting that VAT and the taxes paid on corporate profits are in reality one and the same, then no, that's wholly incorrect.

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

#434

Post by actionfromafar »

systemtest wrote: post #399
NoboruWataya wrote: post #358

Earlier quoted context omitted.

There is a general prohibition on EU member states granting state aid to companies, but there are exceptions to this where the aid is justified in order to promote economically underdeveloped regions. There are a lot of rules and court cases about when state aid will fall on one side or the other of that line. See eg https://competition-policy.ec.europa.eu/state-aid/legislatio...

The Dutch government is spending billions to keep ASML in The Netherlands. To circumvent these prohibitions, the money doesn't go directly to ASML but is invested in better infrastructure, housing and education in the local area. More trains and busses to bring people to the company, better energy grid to power all the ASML offices, more money towards STEM studies of the local universities so they are creating the ne…

It is kind of funny in way. :-)

"Oh no, education and better infrastructure such as mass transit and a power grid, the horror!"

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

#435

Post by lotsofpulp »

lowbloodsugar wrote: post #331
dgrin91 wrote: post #99

Earlier quoted context omitted.

This is a very naive way of thinking about debt. Cash has a time value. Cash now is worth more than cash later. I have a mortgage. This mortgage is worth more than the cash I own. That doesn't mean I'm bankrupt. The mortgage is paid on a fixed schedule over 30 years, and during those 30 years I'll have a home and be able to accrue other assets. If I didn't get a mortgage then I would still be saving for my home. The…

>The mortgage is paid on a fixed schedule over 30 years But now imagine that you are never allowed to pay it off: you only pay the interest. And the debt will be passed to your children, and their children. This is the US Govt debt. In feudal times, you worked for your lord and master. If you didn't pay, armed men would come and take your stuff. In modern times, you still work for your lords and masters, and if you d…

In modern times, the lord and master is older generations (or soon to be old generations) that vote for greater and greater benefits and lower taxes for themselves.

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

#436

Post by carlosjobim »

noirbot wrote: post #361
alibarber wrote: post #352

Earlier quoted context omitted.

Ireland cannot do that. That’s literally the whole point of the EU (or specifically a single market) Effectively - your hypothetical proposed ‘apple law’ would, at some point in the Irish law passing process, be found to be incompatible with their commitments to being in the EU, and I assume it would be then an unconstitutional law. The price of admittance to the EU is basically having this process and constitution.…

I mean, isn't that exactly the case here though? Ireland's law said they could do this. The EU says that's wrong, and Ireland is seemingly getting a reward for doing something illegal that the EU didn't decide was illegal for almost 30 years? Again, not disputing that this is legally accurate to how things work, but that definitely strikes me as an environment that a lot of businesses would find hard to work with. Ot…

> Ireland is seemingly getting a reward

They're not really getting a reward, because this makes them much less attractive for investment. Meaning less tax revenue in the wider and longer perspective.

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

#437

Post by realityking »

hnbad wrote: post #420
realityking wrote: post #405

Earlier quoted context omitted.

I don’t think Deutsche Bank has ever received direct state aid, they’re quite proud of that fact. Though they have benefitted indirectly when institutions that owed Deutsche Bank money received state aid. Lufthansa did receive state aid during the pandemic. This is currently under investigation as the EU’s approval was annulled by an EU court: https://ec.europa.eu/commission/presscorner/detail/en/ip_24_...

To be clear: Germany also heavily subsidized a lot of other large companies, especially in the automotive industry during the pandemic but the politicians involved were mostly smart enough to hide this behind grants with tailor-made requirements that only incidentally happened to perfectly match those companies and few else.

At least VW and BMW have certainly received state aid in the past, mostly around opening new factories, but I can’t find anything where they got specific aid during Covid. Of course they were able to use support that’s open to all companies, e.g. Kurzarbeit, but that’s not considered state aid in the EU context.

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

#438

Post by aktenlage »

gunapologist99 wrote: post #421
hinkley wrote: post #362

Earlier quoted context omitted.

Maybe they should do it like Roth IRAs. You can move the money to a tax haven only after you’ve paid taxes on it. So if you’re building hotels or factories in the haven that’s fine. If you’re hiding money we demand our pound of flesh.

.. thus removing a significant portion of income from these so-called tax havens, which generally tend to be poorer countries. No one has accused Germany of being a tax haven, for instance.

This list disagrees with "poorer countries": https://worldpopulationreview.com/country-rankings/tax-haven...

   1 British Virgin Islands
   2 Cayman Islands
   3 Bermuda
   4 Netherlands
   5 Switzerland
   6 Luxembourg
   7 Hong Kong
   8 Jersey
   9 Singapore
  10 United Arab Emirates

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

#440

Post by GeekyBear »

epolanski wrote: post #424
The_Colonel wrote: post #388

Earlier quoted context omitted.

It's more difficult to determine where the value in software is being created. Still, big tech has a lot of R&D offices in Ireland.

That's not what really Apple did in Europe to pay little taxes. The scheme was essentially like this: - Apple Ireland bought iphones for 200$ or so (talking about pre X numbers, now they're likely slightly higher) - Apple Ireland sold iPhones to Apple Italy for 599€s - Apple Italy sold iPhones for 599€s + vat (thus avoiding to pay any corporate taxes in Italy while making billions) - Apple Ireland had a special agree…

> avoiding to pay any corporate taxes in Italy

This us a fairly common strategy not limited to tech.

For instance, Starbucks in the UK:

> Starbucks Coffee Company (UK) made a £149m “gross profit” in the year to October 2023, up from £129m the year before. But after “administrative expenses” of £127m, its pre-tax profits were reduced to £16.9m, on which it paid £7.2m tax...

In 2012, it was revealed that Starbucks had paid just £8.6m in taxes on £3bn in UK sales since 1998,

https://www.theguardian.com/business/2024/apr/05/starbucks-p...

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