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> I absolutely agree with their position that their profits should be taxed in the US, not in the EU. That's not their position, that's their words. Or why do

> I absolutely agree with their position that their profits should be taxed in the US, not in the EU. That's not their position, that's their words. Or why do they hide the billions since years if they want their profits to be taxed in the US?

tdubhro1 10y ago
US companies holding cash offshore is a separate issue. Not the same. Different. The top 50 companies now hold about $1.5 trillion offshore. This is a US tax loophole that the US govt can decide what it wants to do about it. It does not mean that every country in the world can suddenly decide that they should be able to levy corporation tax on multinationals. I mean, apart from anything else, how they hell would they even do that, given that they don't have the full set of accounts covering all the company's operations, to even know whether the company was profitable or not. You can be profitable in a lot of countries and loss-making in a lot of others - so in the new fantasy land, do we need to pay corporation tax in all the profitable countries and get a paper tax-loss in the unprofitable ones? I can't believe I'm this far into debating such a ridiculously stupid idea.
- AnAfrican 10y ago
  >how they hell would they even do that, given that they don't have the full set of accounts covering all the company's operations, to even know whether the company was profitable or not. But they have the accounts of the local subsidiary. And that local subsidiary either makes a profit or not. And, the company is taxed in each country of operations, for relevant operations.
  - tdubhro1 10y ago
    Local subsidiaries are not usually resellers, and even if they were, the parent company can set an arbitrary price, so they just say that every iPhone cost $1000 and is sold at $599 locally, so the subsidiary makes a massive loss - there are plenty of other reasons, think it through and you'll see that the subsidiary can't operate like a reseller. The subsidiary will usually have accounts that have costs like salary and premises, and no direct revenues, just a big cash transfer to fund the costs from the parent company.
    - AnAfrican 10y ago
      >Local subsidiaries are not usually resellers, and even if they were, the parent company can set an arbitrary price The main reason why subsidiaries are set up is to enter a market and sell stuff. The main reason tax is discussed is because sales/revenue/profit is generated in one place. And they do set up arbitrary prices within the limits of anti-dumping laws. But then again, someone somewhere will tax something. >no direct revenues, just a big cash transfer to fund the costs from the parent company In Apple (and many others' case), the local subsidiary has revenue. They actually bill consumers and collect payments.
    - pluma 10y ago
      > so the subsidiary makes a massive loss Sure, and if it did, the parent would make a massive profit they would have to pay taxes on. Someone at some point has to pay taxes on the profits. Apple just pressured Ireland into looking the other way and granting a tax scheme that is not actually valid and the EC has corrected that by pointing out Apple failed to pay taxes it legally owed.
- jmfayard 10y ago
  Apple do not have to pay taxes on the billions they choose to amass in Ireland in "every country". They have to pay them in Ireland where they decided to locate it. Had they pay the same rate as every other company located in Ireland, that would have been €13 billion over all those years. (Ireland has low taxes, so this is just an hint that Apple Europe is very big). Instead "Apple paid an effective corporate tax rate that declined from 1% in 2003 to 0.005% in 2014 on the profits of Apple Sales International". They achieved that using a tax scheme that is on its way to be declared illegal by the international treaties Ireland is part of. How is that "ridiculously stupid"?
  - tdubhro1 10y ago
    Because Apple Sales International is a proxy for a US domiciled entity. This is what Apple needs to fix, the EU has correctly pointed this out many years ago, and Apple are dragging their heels on fixing it because it's one way they have of keeping the cash offshore (from the US), but it doesn't change the fact that the profits were not created in Ireland and should not be subject to corporation tax there.

tdubhro1 10y ago

US companies holding cash offshore is a separate issue. Not the same. Different. The top 50 companies now hold about $1.5 trillion offshore. This is a US tax loophole that the US govt can decide what it wants to do about it. It does not mean that every country in the world can suddenly decide that they should be able to levy corporation tax on multinationals. I mean, apart from anything else, how they hell would they even do that, given that they don't have the full set of accounts covering all the company's operations, to even know whether the company was profitable or not. You can be profitable in a lot of countries and loss-making in a lot of others - so in the new fantasy land, do we need to pay corporation tax in all the profitable countries and get a paper tax-loss in the unprofitable ones? I can't believe I'm this far into debating such a ridiculously stupid idea.

AnAfrican 10y ago
>how they hell would they even do that, given that they don't have the full set of accounts covering all the company's operations, to even know whether the company was profitable or not. But they have the accounts of the local subsidiary. And that local subsidiary either makes a profit or not. And, the company is taxed in each country of operations, for relevant operations.
- tdubhro1 10y ago
  Local subsidiaries are not usually resellers, and even if they were, the parent company can set an arbitrary price, so they just say that every iPhone cost $1000 and is sold at $599 locally, so the subsidiary makes a massive loss - there are plenty of other reasons, think it through and you'll see that the subsidiary can't operate like a reseller. The subsidiary will usually have accounts that have costs like salary and premises, and no direct revenues, just a big cash transfer to fund the costs from the parent company.
  - AnAfrican 10y ago
    >Local subsidiaries are not usually resellers, and even if they were, the parent company can set an arbitrary price The main reason why subsidiaries are set up is to enter a market and sell stuff. The main reason tax is discussed is because sales/revenue/profit is generated in one place. And they do set up arbitrary prices within the limits of anti-dumping laws. But then again, someone somewhere will tax something. >no direct revenues, just a big cash transfer to fund the costs from the parent company In Apple (and many others' case), the local subsidiary has revenue. They actually bill consumers and collect payments.
  - pluma 10y ago
    > so the subsidiary makes a massive loss Sure, and if it did, the parent would make a massive profit they would have to pay taxes on. Someone at some point has to pay taxes on the profits. Apple just pressured Ireland into looking the other way and granting a tax scheme that is not actually valid and the EC has corrected that by pointing out Apple failed to pay taxes it legally owed.
jmfayard 10y ago
Apple do not have to pay taxes on the billions they choose to amass in Ireland in "every country". They have to pay them in Ireland where they decided to locate it. Had they pay the same rate as every other company located in Ireland, that would have been €13 billion over all those years. (Ireland has low taxes, so this is just an hint that Apple Europe is very big). Instead "Apple paid an effective corporate tax rate that declined from 1% in 2003 to 0.005% in 2014 on the profits of Apple Sales International". They achieved that using a tax scheme that is on its way to be declared illegal by the international treaties Ireland is part of. How is that "ridiculously stupid"?
- tdubhro1 10y ago
  Because Apple Sales International is a proxy for a US domiciled entity. This is what Apple needs to fix, the EU has correctly pointed this out many years ago, and Apple are dragging their heels on fixing it because it's one way they have of keeping the cash offshore (from the US), but it doesn't change the fact that the profits were not created in Ireland and should not be subject to corporation tax there.