# Apple/Ireland tax deal nixed by EU **URL:** \ **Category:** Great Debates\ **Created:** [August 30, 2016, 3:03pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484 "2016-08-30T15:03:44Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [August 31, 2016, 5:58pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/21 "2016-08-31T17:58:00Z")
> [@puddleglum](#): > > On the other hand a race to the bottom for taxes would be a good thing. Taxes are the price you pay for government services. It is good for consumers and customers when businesses engage in races to the bottom for prices. Well, that’s lovely and simple, and naive. Ireland has been dealing with brutal EU/German enforced austerity for several years - services completely devastated, health, schools horribly hit. Apple shareholders on the other hand … ---
**Author:** ![Amateur\_Barbarian](https://avatars.discourse-cdn.com/v4/letter/a/59ef9b/32.png) [@Amateur\_Barbarian](https://boards.straightdope.com/u/Amateur_Barbarian)\ **Post date:** [August 31, 2016, 6:31pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/22 "2016-08-31T18:31:11Z")
> [@doorhinge](#): > > If Apple choses to leave Ireland, and it is their choice to do so, maybe Ireland should leave the EU, also??? And maybe Apple should only sell its products in countries willing to grant them favorable tax status… eh? ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [August 31, 2016, 6:55pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/23 "2016-08-31T18:55:37Z")
> [@puddleglum](#): > > I see it as two issues. Special tax carve outs for certain businesses is a bad idea because it is a form of corruption. Government should treat everyone equally. > On the other hand a race to the bottom for taxes would be a good thing. Taxes are the price you pay for government services. It is good for consumers and customers when businesses engage in races to the bottom for prices. That is why standards of living are higher now than at any point in human history. If the Irish government can provide government services for less than other governments it is good for its citizens because that leaves more money left over for other uses. If that efficiency causes other country’s governments to compete by lowering the cost of their services that is even better. If you want to argue that free markets can be good for overall welfare, then I can agree in general principle. But, that is not how governments work. Tax competition does not lead to leaner more efficient, more effective governments. We have 50 states in the USA and low tax rates do not translate to leaner more efficient more effective governments. It leads to shitty roads, shitty schools, shitty government services, etc. ---
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [August 31, 2016, 7:00pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/24 "2016-08-31T19:00:57Z")
Reading this thread you could almost wonder how it is candidates like Sanders and Trump are surging: it’s just another classic ‘robbing the poor to pay the rich’ scheme cooked up by the political class and the 1%. Just pay the farking tax, you miserable scum. ---
**Author:** ![Amateur\_Barbarian](https://avatars.discourse-cdn.com/v4/letter/a/59ef9b/32.png) [@Amateur\_Barbarian](https://boards.straightdope.com/u/Amateur_Barbarian)\ **Post date:** [August 31, 2016, 7:01pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/25 "2016-08-31T19:01:34Z")
> [@Damuri\_Ajashi](#): > > If you want to argue that free markets can be good for overall welfare, then I can agree in general principle. But, that is not how governments work. Tax competition does not lead to leaner more efficient, more effective governments. We have 50 states in the USA and low tax rates do not translate to leaner more efficient more effective governments. It leads to shitty roads, shitty schools, shitty government services, etc. See: California’s progress from the 1978 tax revolt until hot pilot Brown barely saved it from a monstrous crash landing. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [August 31, 2016, 7:04pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/26 "2016-08-31T19:04:09Z")
> [@doorhinge](#): > > What single governing body has the authority to set state tax rates for all 50 states? Without a single governing body, how would you encourage all 50 states to relinguish their soverign right to set their own tax rates? What basic, world-wide, tax rate do you consider appropriate? 1%, 5%, 10%? They can set whatever rate they want as long as they apply it to all similarly situated taxpayers. What they CAN’T do is make special tax deals for specific taxpayers. Perhaps you have lost track of what we are talking about but the original post that you responded to was talking about taxpayer specific tax breaks. > [@](#): > > What single governing body has the authority to set tax rates around the world? The UN? Well the UN can’t do it but they don’t really get involved in economics and trade like that. > [@](#): > > Wisconsin offers Illinois companies a tax break to move from Illinois to Wisconsin. That’s a competitive advantage for Wisconsin and for the companies which take advantage of the situation. Illinois doesn’t like it but Illinois can offer tax breaks to keep companies in Illinois. Either way, all taxes paid by companies in Illinois and Wisconsin are passed on to the consumers. Consumers pay the taxes of the companies and they pay more taxes for purchasing the products these companies make. And this is effectively cannibalism and it is horrible for civilization. > [@](#): > > Ireland offered Apple a tax break to move some of it’s operation to Ireland. Apple could have moved this operation to Michigan. Michigan certainly needs the jobs. But Apple needed an EU presence and Ireland made the best offer. And sovereign states should not be engaged in the business of paying companies. > [@](#): > > But wait, there’s more. > > The EU doesn’t like the deal. After the fact, they declare that Ireland didn’t charge enough, and Apple should pay more. I guess that’s the price of belonging to the EU. Yes, its an unfair tax subsidy. The rules against that were in place when Apple struck the deal, their lawyers should have known that this was possible. > [@](#): > > The British voters seem to have many reasons for their decision to leave the EU. It appears that a majority of voters do not like how the EU runs/influences/regulates British companies, or tells British voters how to live. I’m pretty sure that it was mostly racism. > [@](#): > > If Apple choses to leave Ireland, and it is their choice to do so, maybe Ireland should leave the EU, also??? Ireland would have little to offer if they didn’t provide access to the EU with the lowest corporate rates in the EU. That is literally the only reason most of these companies are even in Ireland. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [August 31, 2016, 7:06pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/27 "2016-08-31T19:06:14Z")
> [@doorhinge](#): > > (post shortened) > > “In effect”? The Irish government did NOT have this £11 billion. The Irish citizens did NOT have this £11 billion. Apple was capable of making £11 billion plus and the Irish government, as well as thousands of Irish workers, wanted a piece of the Apple pie. > > A deal was made to bring Apple to Ireland. Except a deal wasn’t made. Not according to some EU commission. Maybe companies who wish to bring business to EU members should skip negotiating with individual sovereign governments and deal directly with their EU over-bosses? They should skip negotiations altogether. Why should they get a special deal when I cannot get a similarly special deal? Because they are rich? The assumptions underlying free markets assumes that shit like this doesn’t happen. ---
**Author:** ![octopus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/octopus/32/3716_2.png) [@octopus](https://boards.straightdope.com/u/octopus)\ **Post date:** [August 31, 2016, 7:07pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/28 "2016-08-31T19:07:22Z")
> [@up\_the\_junction](#): > > Reading this thread you could almost wonder how it is candidates like Sanders and Trump are surging: it’s just another classic ‘robbing the poor to pay the rich’ scheme cooked up by the political class and the 1%. > > Just pay the farking tax, you miserable scum. They shouldn’t pay if they don’t owe. An appeal is being made. ---
**Author:** ![Bone](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bone/32/407_2.png) [@Bone](https://boards.straightdope.com/u/Bone)\ **Post date:** [August 31, 2016, 7:11pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/29 "2016-08-31T19:11:34Z")
> [@Damuri\_Ajashi](#): > > Tax competition does not lead to leaner more efficient, more effective governments. We have 50 states in the USA and low tax rates do not translate to leaner more efficient more effective governments. It leads to shitty roads, shitty schools, shitty government services, etc. Unfortunately higher tax rates don’t necessarily translate into better roads, better schools, or better government services either. > [@Amateur\_Barbarian](#): > > See: California’s progress from the 1978 tax revolt until hot pilot Brown barely saved it from a monstrous crash landing. This is funny - you seem to think that CA had low tax rates before Brown. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [August 31, 2016, 7:30pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/30 "2016-08-31T19:30:43Z")
> [@Damuri\_Ajashi](#): > > If you want to argue that free markets can be good for overall welfare, then I can agree in general principle. But, that is not how governments work. Tax competition does not lead to leaner more efficient, more effective governments. We have 50 states in the USA and low tax rates do not translate to leaner more efficient more effective governments. It leads to shitty roads, shitty schools, shitty government services, etc. This is not true. For instance Vermont spends twice as much per citizen as New Hampshire and they rank lower on the quality of their roads, and lower in educational attainment. It seems like New Hampshire has a more efficient government. ---
**Author:** ![Amateur\_Barbarian](https://avatars.discourse-cdn.com/v4/letter/a/59ef9b/32.png) [@Amateur\_Barbarian](https://boards.straightdope.com/u/Amateur_Barbarian)\ **Post date:** [August 31, 2016, 7:40pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/31 "2016-08-31T19:40:29Z")
> [@Bone](#): > > This is funny - you seem to think that CA had low tax rates before Brown. No, the point is that slashing a major tax base by referendum did not “force the politicians to be honest”; it slowly destroyed one of the best civic infrastructures in the country. After several inept administrations, Brown was able and savvy enough to at least level things out. It’s still all damaged, possibly beyond repair. ---
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [August 31, 2016, 8:57pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/32 "2016-08-31T20:57:21Z")
> [@puddleglum](#): > > This is not true. For instance Vermont spends twice as much per citizen as New Hampshire and they rank lower on the quality of their roads, and lower in educational attainment. It seems like New Hampshire has a more efficient government. This is just plain dumb. before even getting to the start most people would look at the size of the relative tax bases and scale of infrastructure. As an aside, is this forum getting stupider or i it just better reflecting the quality of political debate in the wider USA? ---
**Author:** ![TheSeaOtter](https://avatars.discourse-cdn.com/v4/letter/t/ed655f/32.png) [@TheSeaOtter](https://boards.straightdope.com/u/TheSeaOtter)\ **Post date:** [August 31, 2016, 9:02pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/33 "2016-08-31T21:02:12Z")
Tim Cook has written an open letter to Apple’s customers on the matter, published in the WSJ (link: [http://blogs.wsj.com/dispatch/2016/08/30/tim-cooks-letter-to-apple-customers-after-eu-tax-ruling-in-full/](http://blogs.wsj.com/dispatch/2016/08/30/tim-cooks-letter-to-apple-customers-after-eu-tax-ruling-in-full/)) > [@](#): > > Apple has long supported international tax reform with the objectives of simplicity and clarity. We believe these changes should come about through the proper legislative process, in which proposals are discussed among the leaders and citizens of the affected countries. And as with any new laws, they should be applied going forward — not retroactively. I basically agree with this. I do think corporations should pay more taxes, and that it should be harder for multinationals to move their taxable income to places with favorable rates. That said, there is a right way to do that, and it involves changing the law, and most definitely does not involve retroactive taxation. ---
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [August 31, 2016, 10:13pm UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/34 "2016-08-31T22:13:36Z")
There is nothing retroactive; the law has not changed. It has been the same law for the entire period of this avoidance scheme. ---
**Author:** ![Stringbean](https://avatars.discourse-cdn.com/v4/letter/s/d6d6ee/32.png) [@Stringbean](https://boards.straightdope.com/u/Stringbean)\ **Post date:** [September 1, 2016, 1:46am UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/35 "2016-09-01T01:46:44Z")
Just so I understand here: Ireland can not set preferential tax treatment for individual companies, and this is codified in the EU law? And the mechanism for addressing an infraction is to retroactively punish the company? ---
**Author:** ![UDS](https://avatars.discourse-cdn.com/v4/letter/u/ecae2f/32.png) [@UDS](https://boards.straightdope.com/u/UDS)\ **Post date:** [September 1, 2016, 2:17am UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/36 "2016-09-01T02:17:38Z")
> [@Stringbean](#): > > Just so I understand here: > > Ireland can not set preferential tax treatment for individual companies, and this is codified in the EU law? > > And the mechanism for addressing an infraction is to retroactively punish the company? Ireland cannot grant state aid to preference one company over another; it’s anti-competitive. (The EU has very robust competition law.) The tax ruling given to Apple is being regarded as an improper state aid. Standard requirements when an improper state aid has been found to have been provided is to require it to be repaid. That isn’t seen as punitive; just as a restoration of affairs to what they would have been, had the company never received the improper state aid. ---
**Author:** ![Stringbean](https://avatars.discourse-cdn.com/v4/letter/s/d6d6ee/32.png) [@Stringbean](https://boards.straightdope.com/u/Stringbean)\ **Post date:** [September 1, 2016, 2:45am UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/37 "2016-09-01T02:45:44Z")
> [@UDS](#): > > Ireland cannot grant state aid to preference one company over another; it’s anti-competitive. (The EU has very robust competition law.) The tax ruling given to Apple is being regarded as an improper state aid. > > Standard requirements when an improper state aid has been found to have been provided is to require it to be repaid. That isn’t seen as punitive; just as a restoration of affairs to what they would have been, had the company never received the improper state aid. Why isn’t the state (the entity acting under the auspices of EU law) the one required to recompense? Apple is a foreign corporation negotiating with a government it seeks to conduct business with. It is _their_ responsibility to retroactively pay for Ireland’s illegal tax preferences? Are we only willing to accept this injustice because it’s _insert evil large multinational here_? ---
**Author:** ![Miller](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/miller/32/481_2.png) [@Miller](https://boards.straightdope.com/u/Miller)\ **Post date:** [September 1, 2016, 3:19am UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/38 "2016-09-01T03:19:06Z")
> [@Stringbean](#): > > Why isn’t the state (the entity acting under the auspices of EU law) the one required to recompense? > > Apple is a foreign corporation negotiating with a government it seeks to conduct business with. It is _their_ responsibility to retroactively pay for Ireland’s illegal tax preferences? > > Are we only willing to accept this injustice because it’s _insert evil large multinational here_? Well, that’s pretty much how it works for everyone, regardless of their status as a multinational corporation. “I didn’t know that was against the law!” isn’t generally accepted by most courts as a valid defense. Certainly, if my CPA turns out to be an idiot, and fucks up filing my taxes, I don’t get a pass on paying them, even though I had no idea anything was wrong. And considering that Apple has more lawyers than some countries have citizens, it strikes me as unlikely that this completely blindsided them. Also, I’m not sure who you mean by “the state” here, when you say the state should be required to pay up. Are you saying that Ireland’s government should pay itself 15 billion? Or that the EU should pay Ireland 15 billion, because they figured out that Ireland and Apple were breaking the law? Either way, that doesn’t make much sense. ---
**Author:** ![ISiddiqui](https://avatars.discourse-cdn.com/v4/letter/i/97f17d/32.png) [@ISiddiqui](https://boards.straightdope.com/u/ISiddiqui)\ **Post date:** [September 1, 2016, 3:41am UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/39 "2016-09-01T03:41:00Z")
In addition it was Apple who directly benefited from improper state aid (and I am sure they knew it from the beginning), so they pay back the improper benefits they received. Sent from my Nexus 6P using Tapatalk ---
**Author:** ![UDS](https://avatars.discourse-cdn.com/v4/letter/u/ecae2f/32.png) [@UDS](https://boards.straightdope.com/u/UDS)\ **Post date:** [September 1, 2016, 4:46am UTC](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484/40 "2016-09-01T04:46:09Z")
> [@Stringbean](#): > > Why isn’t the state (the entity acting under the auspices of EU law) the one required to recompense? Both parties to this transaction were required to comply with the law. > [@Stringbean](#): > > Apple is a foreign corporation negotiating with a government it seeks to conduct business with. It is _their_ responsibility to retroactively pay for Ireland’s illegal tax preferences? > > Are we only willing to accept this injustice because it’s _insert evil large multinational here_? Why is it an injustice? Every corporation, regardless of where incorporated, and every person, regardless of citizenship, has the responsibility of complying with the law of any jurisdiction in which it operates. Apple doesn’t get a free pass on account of being a foreign corporation. Apple sought and obtained something which was, under the law in force at the time, an improper state aid to which they were not entitled. (At least, that’s the view of the European Commission.) Presumably, Apple were aware of this risk and considered it before deciding to proceed. (If not, they may have a case against their advisers.) Apple can appeal this and argue that this wasn’t an improper state aid at all. (SFAIK, that is what they have announced they will do. The Irish government is taking a similar position.) Or, they can argue that if the tax rulings had not been given, they would not have booked their profits in Ireland and the way to “unwind” the improper state aid is is not to pay back taxes to Ireland on the basis that the ruling is ineffective, but to calculate the taxes that would have been due if they had booked their profits as they would have done had the tax ruling never been given, and pay those taxes (presumably, to other governments). There’s no guarantee, though, that this would cost them less. But arguing that they get to keep the state aid because they’re a “foreign corporation”? There’s no milage in that. The whole point of the competition regime is to provide a level playing field. Arguing that foreign corporations are exempt from the consequences of non-compliance completely misses the point. [Previous page](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484.md?page=1) [Next page](https://boards.straightdope.com/t/apple-ireland-tax-deal-nixed-by-eu/764484.md?page=3)