4 ms·

The only thing really sneaky that Apple did was pressure the Irish to give them a special deal, but it's still legal, and rational. If Apple did get a sweethea

by uiri 10y ago

The only thing really sneaky that Apple did was pressure the Irish to give them a special deal, but it's still legal, and rational. If Apple did get a sweetheart deal, that is illegal under EU rules. That is what the whole dispute is about. But I don't think that they got such a deal. I think that Apple may have forum shopped for the best tax regime in the EU. Ireland has extremely low corporate tax rates period; no sweetheart deal required.

SixSigma 10y ago
Not if https://www.icij.org/project/luxembourg-leaks/new-leak-reveals-luxembourg-tax-deals-disney-koch-brothers-empire https://www.icij.org/project/luxembourg-leaks/new-leak-revea...
soneil 10y ago
I don't believe there was any pressure - it's simply the Irish system to incentivise companies who'd otherwise have no business here. 80% of all corporate tax paid in 2015 came from non-irish businesses. 40% of all corporate tax paid in 2015 came from 10 companies. Apple are the largest single taxpayer in Ireland. (http://www.revenue.ie/en/about/publications/corporation-tax-receipts-2014-2015.pdf http://www.revenue.ie/en/about/publications/corporation-tax-...) So the Irish strategy is to be nice to multi-nationals, in return for that 80%. The understanding is that if we taxed more, they'd move somewhere else and we'd actually receive less. e.g., biting the hand that feeds you. (This is also why the Irish govt are going to defend Apple in this - this isn't just about Apple for them, it's about scaring off 80% of corporate revenues)
- bluecalm 10y ago
  Props to Ireland for doing that. They collect taxes on salaries those big corps pay as well and then consumption taxes on what the workers buy. I wish my country was similarly clever (we have corporate tax at 19% and a lot of companies are coming here but if our politicians had a bit of foresight it would be 0% long time ago and everyone here would be way better off).
  - soneil 10y ago
    Well, I'm not complaining - pretty much everyone I know is in tech, and those jobs are only here for one reason.
- lhc- 10y ago
  Consider the pressure / race to the bottom this puts on the rest of the EU though. The EU has an incentive to try to keep things fair between the states (disallowing sweetheart deals to lure companies away from other members), because this sort of competition is harmful to the EU as a whole. It's not like Apple is going to stop selling to Europe; they'll be somewhere if not Ireland, and the EU benefits as a whole if Apple is not allowed to skip out on paying its share.
  - mike_hearn 10y ago
    Since when was the EU supposed to be about making things "fair" between countries? The EU does not advertise itself as a club that requires you to become less competitive in order to avoid upsetting the French. Tax competition doesn't harm the EU, it makes it stronger. Because you realise, that there are countries outside the EU too, who can also lower their tax rates ...
  - wav-part 10y ago
    IMHO, Taxes (or market access/safety-of-life etc) are absurdely overpriced. We are seeing market-competition. And I for one welcome it, like any other competition. I dont know whats "fair" and I dont care. I want things as cheap as possible.
  - soneil 10y ago
    The problem is, no-one's offered a sane alternative. The top employment sectors in Ireland are Food&Drink, Pharma, and Tech. The latter two of those are massively dominated by multinationals. Combine that with multinationals contributing the bulk of corporate taxes, and we simply can't afford to scare them away. Without these MNCs, Ireland's economy would be basically beef, beer, and American tourists. There simply isn't enough native industry to make up the short-fall (which is the part I think should actually be addressed, rather than the symptoms). (And away they will - Ireland is not the lowest corporate tax rate in the EU. Liechtenstein and Cyprus have the same rate, and 3 more states have a lower rate.) I do understand the desire for a level playing field. It's a noble goal. But we're basically being told "We'd like you to drive your economy back to the 1950s, because France feels it'd be more fair". It's not a particularly enticing proposal - all stick and no carrot. Ironically, they're championing our post-bailout growth as a success, while they retroactively make the mechanisms behind it illegal.
- tormeh 10y ago
  The EU's argument is that they can do this but only if they apply the same tax rate to all companies in the country. Apple and O'Donald's Vintage Bicycle Repairs should be subject to the same tax, in other words.
- Oletros 10y ago
  > The understanding is that if we taxed more, they'd move somewhere else and we'd actually receive less. e.g., biting the hand that feeds you. This case is not about Ireland taxing more or less the companies, it is about a sweetheart deal with one company
  - soneil 10y ago
    It's not one company. It's one example. Pretending this is only about Apple, while completely ignoring the implications to other MNCs, is precisely what Ireland can't afford to do
    - Oletros 10y ago
      > It's not one company. It's one example. Pretending this is only about Apple, while completely ignoring the implications to other MNCs, is precisely what Ireland can't afford to do Can you point another company that has a sweetheart deal with the Irish government like the one Apple had?

by uiri 10y ago

SixSigma 10y ago

Not if https://www.icij.org/project/luxembourg-leaks/new-leak-reveals-luxembourg-tax-deals-disney-koch-brothers-empire https://www.icij.org/project/luxembourg-leaks/new-leak-revea...

soneil 10y ago

I don't believe there was any pressure - it's simply the Irish system to incentivise companies who'd otherwise have no business here. 80% of all corporate tax paid in 2015 came from non-irish businesses. 40% of all corporate tax paid in 2015 came from 10 companies. Apple are the largest single taxpayer in Ireland. (http://www.revenue.ie/en/about/publications/corporation-tax-receipts-2014-2015.pdf http://www.revenue.ie/en/about/publications/corporation-tax-...) So the Irish strategy is to be nice to multi-nationals, in return for that 80%. The understanding is that if we taxed more, they'd move somewhere else and we'd actually receive less. e.g., biting the hand that feeds you. (This is also why the Irish govt are going to defend Apple in this - this isn't just about Apple for them, it's about scaring off 80% of corporate revenues)

bluecalm 10y ago
Props to Ireland for doing that. They collect taxes on salaries those big corps pay as well and then consumption taxes on what the workers buy. I wish my country was similarly clever (we have corporate tax at 19% and a lot of companies are coming here but if our politicians had a bit of foresight it would be 0% long time ago and everyone here would be way better off).
- soneil 10y ago
  Well, I'm not complaining - pretty much everyone I know is in tech, and those jobs are only here for one reason.
lhc- 10y ago
Consider the pressure / race to the bottom this puts on the rest of the EU though. The EU has an incentive to try to keep things fair between the states (disallowing sweetheart deals to lure companies away from other members), because this sort of competition is harmful to the EU as a whole. It's not like Apple is going to stop selling to Europe; they'll be somewhere if not Ireland, and the EU benefits as a whole if Apple is not allowed to skip out on paying its share.
- mike_hearn 10y ago
  Since when was the EU supposed to be about making things "fair" between countries? The EU does not advertise itself as a club that requires you to become less competitive in order to avoid upsetting the French. Tax competition doesn't harm the EU, it makes it stronger. Because you realise, that there are countries outside the EU too, who can also lower their tax rates ...
- wav-part 10y ago
  IMHO, Taxes (or market access/safety-of-life etc) are absurdely overpriced. We are seeing market-competition. And I for one welcome it, like any other competition. I dont know whats "fair" and I dont care. I want things as cheap as possible.
- soneil 10y ago
  The problem is, no-one's offered a sane alternative. The top employment sectors in Ireland are Food&Drink, Pharma, and Tech. The latter two of those are massively dominated by multinationals. Combine that with multinationals contributing the bulk of corporate taxes, and we simply can't afford to scare them away. Without these MNCs, Ireland's economy would be basically beef, beer, and American tourists. There simply isn't enough native industry to make up the short-fall (which is the part I think should actually be addressed, rather than the symptoms). (And away they will - Ireland is not the lowest corporate tax rate in the EU. Liechtenstein and Cyprus have the same rate, and 3 more states have a lower rate.) I do understand the desire for a level playing field. It's a noble goal. But we're basically being told "We'd like you to drive your economy back to the 1950s, because France feels it'd be more fair". It's not a particularly enticing proposal - all stick and no carrot. Ironically, they're championing our post-bailout growth as a success, while they retroactively make the mechanisms behind it illegal.
tormeh 10y ago
The EU's argument is that they can do this but only if they apply the same tax rate to all companies in the country. Apple and O'Donald's Vintage Bicycle Repairs should be subject to the same tax, in other words.
Oletros 10y ago
> The understanding is that if we taxed more, they'd move somewhere else and we'd actually receive less. e.g., biting the hand that feeds you. This case is not about Ireland taxing more or less the companies, it is about a sweetheart deal with one company
- soneil 10y ago
  It's not one company. It's one example. Pretending this is only about Apple, while completely ignoring the implications to other MNCs, is precisely what Ireland can't afford to do
  - Oletros 10y ago
    > It's not one company. It's one example. Pretending this is only about Apple, while completely ignoring the implications to other MNCs, is precisely what Ireland can't afford to do Can you point another company that has a sweetheart deal with the Irish government like the one Apple had?