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 …
And maybe Apple should only sell its products in countries willing to grant them favorable tax status… eh?
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.
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.
See: California’s progress from the 1978 tax revolt until hot pilot Brown barely saved it from a monstrous crash landing.
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.
Well the UN can’t do it but they don’t really get involved in economics and trade like that.
And this is effectively cannibalism and it is horrible for civilization.
And sovereign states should not be engaged in the business of paying companies.
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.
I’m pretty sure that it was mostly racism.
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.
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.
They shouldn’t pay if they don’t owe. An appeal is being made.
Unfortunately higher tax rates don’t necessarily translate into better roads, better schools, or better government services either.
This is funny - you seem to think that CA had low tax rates before Brown.
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.
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.
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?
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/)
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.
There is nothing retroactive; the law has not changed. It has been the same law for the entire period of this avoidance scheme.
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.
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.
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.
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Both parties to this transaction were required to comply with the law.
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.