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What's the cause of all the flip flopping between Apple having to pay the bill or not? I think the main problem that this area of law is fundamentally uncertain

What's the cause of all the flip flopping between Apple having to pay the bill or not? I think the main problem that this area of law is fundamentally uncertain and hard to apply. Legal mistakes get made, and judgements get appealed until people figure out what the law actually says. A secondary issue is that judges in appeals courts are generalists, not tax or state aid experts. Despite this, they get landed with the hardest cases - situations that haven't been seen before which throw up new legal issues - and need to figure out what to do. Most of the time they get it right. Some of the time, they mis-interpret the law and get it wrong. That's why we have the appeals process. So where are we up to in terms of this case, and how many more flip-flops we can expect? This article is citing an advisory opinion of one of the EU's Advocate Generals (themselves, very senior judges). These advisory opinions are issued prior to the CJEU (the highest court) making a final ruling. They are there to guide the CJEU so that the final ruling is as good as possible. Although this specific case should be finalised after the CJEU makes its ruling, I'm sure the case law will continue to evolve in the future as multinational companies push the boundaries of the EU's tax and state aid regimes.

izacus 3y ago
> What's the cause of all the flip flopping between Apple having to pay the bill or not? I think the main problem that this area of law is fundamentally uncertain and hard to apply. Legal mistakes get made, and judgements get appealed until people figure out what the law actually says. Or you know, Apple is trying really hard to not pay the tax they should and are stalling the process by throwing lawyers at it, because they want to continue their shell company scheme of reselling IP rights to avoid taxes in locales where they sell their hardware and make profit. Is this the first time you're seeing a megacorp try their hardest not to pay their due?
- todd-davies 3y ago
  For sure they are throwing lawyers at it. It's 13bn after all. But the underlying reason for the appeal is the same; the law is not yet clear as to what should happen.
  - izacus 3y ago
    Where do you see the lack of clarity? A wish to avoid paying is not lack of clarity.
    - s1artibartfast 3y ago
      The case is between the Irish government and the EU. Ireland made a a tax deal with Apple. Ireland also made a no corporate subsidy deal with the EU. EU wants apple taxed. Ireland says a tax break is not a subsidy, and a subsidy would be if they gave Apple grants, funds, or special loans
      - AnthonyMouse 3y ago
        > Ireland also made a no corporate subsidy deal with the EU. That seems odd. For example, if the government provides a national healthcare system, this is effectively a subsidy to employers who can then avoid providing a health plan their employees might otherwise demand or otherwise have to pay them more to compensate for their need to pay for their own healthcare. How is this being distinguished from any other form of subsidy? Isn't subsidizing things what governments do with tax money?
        padjo 3y ago
        Bans on state subsidies are a core principle that enables the EU single market. Otherwise the market could easily be distorted by state aid. However it’s far from simple in practice and is something the member states have been arguing about forever. The rest of the eu has never been happy with irelands tax policy but since taxation is a national competency they can’t do anything about it directly. They can however frame it as state aid and try to attack it that way. Edit to add, information on how state aid works in eu context: https://enterprise.gov.ie/en/what-we-do/eu-internal-market/eu-state-aid-rules/ https://enterprise.gov.ie/en/what-we-do/eu-internal-market/e...
        AnthonyMouse 3y ago
- LanceH 3y ago
  They paid taxes according to the laws of a sovereign nation. Seems like a done deal to me. Europe should get their affairs in order. If Ireland shouldn't have done that, that's not Apple. It really seems like a case of "the law should have been", which seems to work in Europe.
  - lokar 3y ago
    In regards to taxation and regulation of services sold into the EU common market Ireland is not fully sovereign. They have their act together, this is the legal process playing out.
    - Kamq 3y ago
      Aren't they still sovereign? They just might be sanction/fined by peers or kicked out of the union if they don't comply? It's not like someone's going to declare war on Ireland and conquer them to force compliance the way a citizen breaking the law might be conquered by a police force.
      - ben_w 3y ago
        The winning move for a single round of the Prisoner's Dilemma is to defect. The winning move for the Iterated Prisoner's Dilemma is tit-for-tat. Enforcement mechanisms lead actors to behave more cooperatively, and everyone knows everyone is better off if everyone is cooperating.
        Kamq 3y ago
        That doesn't make anyone in the game not sovereign
        ben_w 3y ago
        The enforcement mechanism is a voluntary de jure loss of sovereignty, even though the de facto sovereignty to leave the enforcement mechanism remains.
- gigatexal 3y ago
  If I was Apple or any other megacorp I would happily pay the taxes and pay them publicly because of all the goodwill and favors and all the greased politicians and folks it can buy. It’s less hassle than lawyering and cheaper and instead you can focus on building relationships or getting other benefits than hoarding cash which Apple clearly can print like a central bank.
  - generic92034 3y ago
    But someone would not have been promoted (or would not have gotten a huge bonus) without taking advantage of that perceived tax loophole! /s
  - ant6n 3y ago
    Seems like there would be cheaper ways to buy good will greased politicians.
  - londons_explore 3y ago
    That might be the case for super local taxes (eg. Paying land tax to the town), but for nationwide taxes even a big company makes basically no difference. Therefore, politicians don't really care - it isn't their money and doesn't directly impact them.
  - newZWhoDis 3y ago
    Elon paid one of the largest (the largest?) personal tax bills ever. How’s that working out for him?
    - gigatexal 3y ago
      Well he does enough self owning to erode any good will he’s ever earned. You can’t fix stupid. The man is a genius but socially very stupid.
- justincormack 3y ago
  Ireland didn't want Apple to pay either, as they wanted to be able to keep doing this sort of deal.
  - nannal 3y ago
    It's in Ireland's best interest: https://en.wikipedia.org/wiki/Put_on_the_green_jersey https://en.wikipedia.org/wiki/Put_on_the_green_jersey
    - vasdae 3y ago
      That's the way countries should behave generally.
      - nicce 3y ago
        Countries set the bar for human rights, morale and ethics. What if they don’t matter if some provides the money?
    - MuffinFlavored 3y ago
      > https://www.freshbooks.com/glossary/tax/double-irish-dutch-sandwich https://www.freshbooks.com/glossary/tax/double-irish-dutch-s... > https://en.wikipedia.org/wiki/Double_Irish_arrangement https://en.wikipedia.org/wiki/Double_Irish_arrangement > https://en.wikipedia.org/wiki/Ireland_as_a_tax_haven https://en.wikipedia.org/wiki/Ireland_as_a_tax_haven What portion of Ireland's GDP is "American multinational companies" using them for tax avoidance? As long as it is legal for Apple to route the money it makes in America back to shell companies in Ireland and pay 12.5% corporate tax instead of something higher elsewhere, why would it ever stop?
      - extraduder_ire 3y ago
        Around 23% in 2020, based on the difference between GNI* and GDP. It has been higher than that in the past, but increased medical manufacturing pushed it back. It's not just American companies, but they're certainly the largest. The most notable effect here is that you learn to be wary of any stat mentioning "GDP" or "GDP per capita". In 2015, when the US cut-off date for many of these transfers hit, the CSO refused to release accurate corporate tax numbers because it would have identified the companies involved.
- CamperBob2 3y ago
  What do you tell your CPA to do, when tax time rolls around?
pyrale 3y ago
> What's the cause of all the flip flopping between Apple having to pay the bill or not? Basically, since Apple is located in Ireland, they must pay their taxes to Ireland. But Ireland doesn't really want Apple to pay, so that makes it complicated. The real beef is between Europe and Ireland about whether it's legal to offer "personalized" discounts, not about Apple. relevant quote: > it reaches back a few years, beginning with a decision in 2018 that told Apple to hand over the aforementioned €13 billion to Irish tax officials after the European Commission decided Apple and Irish authorities had together broken state aid rules.
doikor 3y ago
> What's the cause of all the flip flopping between Apple having to pay the bill or not? The justice system. Basically going trough the various EU courts due to appeals.
sgjohnson 3y ago
> What's the cause of all the flip flopping between Apple having to pay the bill or not? Ireland doesn’t want Apple to pay.

izacus 3y ago

> What's the cause of all the flip flopping between Apple having to pay the bill or not? I think the main problem that this area of law is fundamentally uncertain and hard to apply. Legal mistakes get made, and judgements get appealed until people figure out what the law actually says. Or you know, Apple is trying really hard to not pay the tax they should and are stalling the process by throwing lawyers at it, because they want to continue their shell company scheme of reselling IP rights to avoid taxes in locales where they sell their hardware and make profit. Is this the first time you're seeing a megacorp try their hardest not to pay their due?

todd-davies 3y ago
For sure they are throwing lawyers at it. It's 13bn after all. But the underlying reason for the appeal is the same; the law is not yet clear as to what should happen.
- izacus 3y ago
  Where do you see the lack of clarity? A wish to avoid paying is not lack of clarity.
  - s1artibartfast 3y ago
    The case is between the Irish government and the EU. Ireland made a a tax deal with Apple. Ireland also made a no corporate subsidy deal with the EU. EU wants apple taxed. Ireland says a tax break is not a subsidy, and a subsidy would be if they gave Apple grants, funds, or special loans
    - AnthonyMouse 3y ago
      > Ireland also made a no corporate subsidy deal with the EU. That seems odd. For example, if the government provides a national healthcare system, this is effectively a subsidy to employers who can then avoid providing a health plan their employees might otherwise demand or otherwise have to pay them more to compensate for their need to pay for their own healthcare. How is this being distinguished from any other form of subsidy? Isn't subsidizing things what governments do with tax money?
      - padjo 3y ago
        Bans on state subsidies are a core principle that enables the EU single market. Otherwise the market could easily be distorted by state aid. However it’s far from simple in practice and is something the member states have been arguing about forever. The rest of the eu has never been happy with irelands tax policy but since taxation is a national competency they can’t do anything about it directly. They can however frame it as state aid and try to attack it that way. Edit to add, information on how state aid works in eu context: https://enterprise.gov.ie/en/what-we-do/eu-internal-market/eu-state-aid-rules/ https://enterprise.gov.ie/en/what-we-do/eu-internal-market/e...
        AnthonyMouse 3y ago
LanceH 3y ago
They paid taxes according to the laws of a sovereign nation. Seems like a done deal to me. Europe should get their affairs in order. If Ireland shouldn't have done that, that's not Apple. It really seems like a case of "the law should have been", which seems to work in Europe.
- lokar 3y ago
  In regards to taxation and regulation of services sold into the EU common market Ireland is not fully sovereign. They have their act together, this is the legal process playing out.
  - Kamq 3y ago
    Aren't they still sovereign? They just might be sanction/fined by peers or kicked out of the union if they don't comply? It's not like someone's going to declare war on Ireland and conquer them to force compliance the way a citizen breaking the law might be conquered by a police force.
    - ben_w 3y ago
      The winning move for a single round of the Prisoner's Dilemma is to defect. The winning move for the Iterated Prisoner's Dilemma is tit-for-tat. Enforcement mechanisms lead actors to behave more cooperatively, and everyone knows everyone is better off if everyone is cooperating.
      - Kamq 3y ago
        That doesn't make anyone in the game not sovereign
        ben_w 3y ago
        The enforcement mechanism is a voluntary de jure loss of sovereignty, even though the de facto sovereignty to leave the enforcement mechanism remains.
gigatexal 3y ago
If I was Apple or any other megacorp I would happily pay the taxes and pay them publicly because of all the goodwill and favors and all the greased politicians and folks it can buy. It’s less hassle than lawyering and cheaper and instead you can focus on building relationships or getting other benefits than hoarding cash which Apple clearly can print like a central bank.
- generic92034 3y ago
  But someone would not have been promoted (or would not have gotten a huge bonus) without taking advantage of that perceived tax loophole! /s
- ant6n 3y ago
  Seems like there would be cheaper ways to buy good will greased politicians.
- londons_explore 3y ago
  That might be the case for super local taxes (eg. Paying land tax to the town), but for nationwide taxes even a big company makes basically no difference. Therefore, politicians don't really care - it isn't their money and doesn't directly impact them.
- newZWhoDis 3y ago
  Elon paid one of the largest (the largest?) personal tax bills ever. How’s that working out for him?
  - gigatexal 3y ago
    Well he does enough self owning to erode any good will he’s ever earned. You can’t fix stupid. The man is a genius but socially very stupid.
justincormack 3y ago
Ireland didn't want Apple to pay either, as they wanted to be able to keep doing this sort of deal.
- nannal 3y ago
  It's in Ireland's best interest: https://en.wikipedia.org/wiki/Put_on_the_green_jersey https://en.wikipedia.org/wiki/Put_on_the_green_jersey
  - vasdae 3y ago
    That's the way countries should behave generally.
    - nicce 3y ago
      Countries set the bar for human rights, morale and ethics. What if they don’t matter if some provides the money?
  - MuffinFlavored 3y ago
    > https://www.freshbooks.com/glossary/tax/double-irish-dutch-sandwich https://www.freshbooks.com/glossary/tax/double-irish-dutch-s... > https://en.wikipedia.org/wiki/Double_Irish_arrangement https://en.wikipedia.org/wiki/Double_Irish_arrangement > https://en.wikipedia.org/wiki/Ireland_as_a_tax_haven https://en.wikipedia.org/wiki/Ireland_as_a_tax_haven What portion of Ireland's GDP is "American multinational companies" using them for tax avoidance? As long as it is legal for Apple to route the money it makes in America back to shell companies in Ireland and pay 12.5% corporate tax instead of something higher elsewhere, why would it ever stop?
    - extraduder_ire 3y ago
      Around 23% in 2020, based on the difference between GNI* and GDP. It has been higher than that in the past, but increased medical manufacturing pushed it back. It's not just American companies, but they're certainly the largest. The most notable effect here is that you learn to be wary of any stat mentioning "GDP" or "GDP per capita". In 2015, when the US cut-off date for many of these transfers hit, the CSO refused to release accurate corporate tax numbers because it would have identified the companies involved.
CamperBob2 3y ago
What do you tell your CPA to do, when tax time rolls around?

pyrale 3y ago

> What's the cause of all the flip flopping between Apple having to pay the bill or not? Basically, since Apple is located in Ireland, they must pay their taxes to Ireland. But Ireland doesn't really want Apple to pay, so that makes it complicated. The real beef is between Europe and Ireland about whether it's legal to offer "personalized" discounts, not about Apple. relevant quote: > it reaches back a few years, beginning with a decision in 2018 that told Apple to hand over the aforementioned €13 billion to Irish tax officials after the European Commission decided Apple and Irish authorities had together broken state aid rules.

doikor 3y ago

> What's the cause of all the flip flopping between Apple having to pay the bill or not? The justice system. Basically going trough the various EU courts due to appeals.

sgjohnson 3y ago

> What's the cause of all the flip flopping between Apple having to pay the bill or not? Ireland doesn’t want Apple to pay.