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Quote:
EU Finance Ministers Line Up Behind $21B Tax Ruling Against Apple (herald-dispatch.com)

Posted by EditorDavid on Sunday September 11, 2016 @09:34AM from the show-of-unanimity dept.


An anonymous Slashdot reader quotes the Associated Press:
Dutch Finance Minister Jeroen Dijsselbloem urged Apple Saturday to "get ready" to pay up, as he and counterparts from other EU nations lined up behind a finding that the technology giant owes billions of euros due to more than a decade of improperly low taxation. Apple's bill could reach 19 billion euros ($21 billion) with interest, and both the company and Ireland, Apple's European headquarters are appealing the European Commission ruling. But on the last day of an EU finance ministers' meeting focused on ways to harmonize tax rules for international companies, Dijsselbloem told reporters that these "have an obligation to pay taxes in a fair way."

"International tax loopholes are a thing of the past," he said. Apple will have to pay back taxes both in the United States and Europe, he added, "so get ready to do that." Philip Hammond, his British counterpart, said the EU was keen "to make sure that international corporations pay the right tax at the right place. That's the fair way to do it, and we are going to make sure it happens."

Austria, France, and Italy are reportedly also watching the case closely.


This is going to kill apple's stock price which will kill apple executives tax fraud based bonuses.

Just as soon as this ruling passed, suddenly Apple wanted to start moving it's profits back to the U.S.

They were paying 0.5% taxes and then they got greedy and went for 0.005% taxes.

I'm just surprised countries didn't figure out sooner they were being defrauded on taxes for sales within their national borders.

Apple already charges the maximum price the market will bear so any taxes paid will come straight out of their profits.

Not religious-- but praying the EU doesn't "settle" this for some puny amount. If the EU holds apple to their legally required taxes, then every other business will come running for deals to avoid having to pay their fair tax rates on illegally evaded back taxes.
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Mike Stiles
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Seems like a perfect 'example' case for the EU. Apple's got a ton of $$$ to apply influence, but if the governments stick it to them, anyone else is gonna get spooked.
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Walking on eggshells is not my style
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They are done?

21 billion is a sizable fraction of their quarterly income, and a smaller fraction of their yearly profit.

Since you've been known to offer such advice, you might call this bit of news "a stock buying opportunity".
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Boaty McBoatface
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It's two things.

JOBS!!!

and then

TECH JOBS!!!

There is this idea that employing a few thousand people in one tech company will boost (as it does to a degree) a countries balance of payments. But it also reveals the lie that is "balance of payments". Apples success did not really benefit the wider Irish economy.

Just becasue one man is making £10 does not means that the 9 earning £1 are better off.
 
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Koldfoot wrote:
They are done?

21 billion is a sizable fraction of their quarterly income, and a smaller fraction of their yearly profit.

Since you've been known to offer such advice, you might call this bit of news "a stock buying opportunity".


This.

Marketwatch tried a headline that disputes the $215B on hand cash claim in the headline but then went on to explain that while they actually do have about $200B it's mainly in Europe, cause taxes in America are just unfair. Plus $175B is in interest earning securities that they'd like to let earn extra tax-free bucks with.

People who buy products from this criminal enterprise are low-intelligence enablers of evil on the face of the planet.
 
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maxo-texas wrote:
This is going to kill apple's stock price which will kill apple executives tax fraud based bonuses.

Pretty easy to boost your profitability when you aren't paying your taxes. It isn't just Apple that is doing this, it is very pervasive throughout the entire stock market. Almost every multinational company has been doing this over the last decade to juice their profit numbers since they have seen every other company doing it and getting away with it. I think it is going to be a substantial drag on profit for a lot of companies as this works it way through the system over the next few years.

What ought to happen is countries should be forcing these cheaters to pay 2x to 5x of the taxes that they haven't paid just to change the calculations that tax lawyers make when they try to cheat the system like this. Increasing the cost of getting caught will result in more companies remaining compliant even when they think they can get away with it.
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slatersteven wrote:
It's two things.

JOBS!!!

and then

TECH JOBS!!!

There is this idea that employing a few thousand people in one tech company will boost (as it does to a degree) a countries balance of payments. But it also reveals the lie that is "balance of payments". Apples success did not really benefit the wider Irish economy.

Just becasue one man is making £10 does not means that the 9 earning £1 are better off.

No that isn't really it, it is a just a simple calculation for the countries which create systems to allow companies to dodge taxes. Ireland can get 20% of Apple's revenue in Ireland or they can get 4% of Apple's revenue in all of Europe. Pretty logical for smaller countries to set up rules to allow companies like Apple to dodge taxes in Europe and the US. Switzerland, Luxembourg, Singapore, Hong Kong, etc have been making a living off of this type of thing for decades.
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sfox wrote:
maxo-texas wrote:
This is going to kill apple's stock price which will kill apple executives tax fraud based bonuses.

Pretty easy to boost your profitability when you aren't paying your taxes. It isn't just Apple that is doing this, it is very pervasive throughout the entire stock market. Almost every multinational company has been doing this over the last decade to juice their profit numbers since they have seen every other company doing it and getting away with it. I think it is going to be a substantial drag on profit for a lot of companies as this works it way through the system over the next few years.

What ought to happen is countries should be forcing these cheaters to pay 2x to 5x of the taxes that they haven't paid just to change the calculations that tax lawyers make when they try to cheat the system like this. Increasing the cost of getting caught will result in more companies remaining compliant even when they think they can get away with it.


The deal as I understood it was struck with Ireland. It wasn't tax evasion, it was blatant government sponsorship where Ireland said that they got an exclusive tax rate. Not sure how that works for retroactive measures but it'll see a sigificant drop in international profits with the tax change.

The current corporate tax rate makes it way too costly to repatriate money as everyone seems to be content to just hold out until another tax holiday. That and the mindset of simply buying out any startup that lacks the VC balls to go big and actually become a threat. Cisco's grabbed up like 11 guys last year iirc.
 
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draxx01 wrote:
The deal as I udnerstood it was struck with Ireland. It wasn't tax evasion, it was blatant government sponsorship where Ireland said that they got an exclusive tax rate.

which is why the Irish gov't is defending Apple.
 
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I realize this is an EU thing, but don't US States do this all the time? I'm speaking of tax breaks and incentives for corporations to setup shop in a particular State.
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jmilum wrote:
I realize this is an EU thing, but don't US States do this all the time? I'm speaking of tax breaks and incentives for corporations to setup shop in a particular State.


It's a big part of how walmart crushes their small town competition. They pay no taxes while their small business competitors do pay taxes. Then sometimes when their tax abatement runs out, they have relocated in the past.

====

On the irish thing- I view

a) making a sale in one country but booking the profits in another country as tax evasion. They may temporarily figure out a legal way to do it but it goes against the spirit of the rules. If you make a profit in a country, you should share some of the profits as taxes to pay for services your company depends on in that country.

b) paying excessive amounts of your profits as "franchise" fees to a "branch" in another country is legal but I think that door will close too because greedy companies are pushing that angle too hard as well.

I think governments will find a way to tax a percentage of gross sales for sales within their borders. I.e. if a customer gives you $10, then the government will take about 2% of that regardless of how you have your "profits" set up. And I think they are nimble enough to discriminate between high profit and low profit businesses (low moat high competition grocery stores make about 3% profits while other high moat low competition (or even monopoly) businesses have a 15% profit rate).

The reason being simply that in the end governments will go where the money is. If the wealthy simply stack the wealth up like cordwood to avoid taxes, then governments will institute a flat out wealth tax.
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jmilum wrote:
I realize this is an EU thing, but don't US States do this all the time? I'm speaking of tax breaks and incentives for corporations to setup shop in a particular State.


Might be a difference between EU trade law and US law.

 
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maxo-texas wrote:
Just as soon as this ruling passed, suddenly Apple wanted to start moving it's profits back to the U.S.

They were paying 0.5% taxes and then they got greedy and went for 0.005% taxes.

I'm just surprised countries didn't figure out sooner they were being defrauded on taxes for sales within their national borders.

Respectively:

Apple wants to take advantage of deducting the taxes in the US, where it will make the biggest difference. Perhaps?

It's Apple's financial officers fiduciary duty to Apple's shareholders to do everything legal--and maybe some unclear things--to preserve shareholder money. The tax system is always gamed; the question is how well and how much can you spend gaming it.

I'm not surprisd: one coherent strategy will beat a bunch of independent uncoordinated actions.
__

I'm not a fan of Apple products. It's a designer company (meaning like designer clothes). I just want a good solid product at a fair price.

It's maybe a buying opportunity, but if you invest in the S&P 500, you're probably overweight Apple already. Since Apple depends on being a design leader, it can fall from grace quickly. It has before.

Some people think the stock market is just gambling. When you invest in a solid company with a long track record, like Intel for instance, it isn't, or at least the odds are heavily in your favor that Intel will continue to be successful, continue to grow, and continue to pay ~3% dividends plus stock appreciation of a few more percent. Apple is more of a gamble, though one that has averaged a better payout.
 
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Boaty McBoatface
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sfox wrote:
slatersteven wrote:
It's two things.

JOBS!!!

and then

TECH JOBS!!!

There is this idea that employing a few thousand people in one tech company will boost (as it does to a degree) a countries balance of payments. But it also reveals the lie that is "balance of payments". Apples success did not really benefit the wider Irish economy.

Just becasue one man is making £10 does not means that the 9 earning £1 are better off.

No that isn't really it, it is a just a simple calculation for the countries which create systems to allow companies to dodge taxes. Ireland can get 20% of Apple's revenue in Ireland or they can get 4% of Apple's revenue in all of Europe. Pretty logical for smaller countries to set up rules to allow companies like Apple to dodge taxes in Europe and the US. Switzerland, Luxembourg, Singapore, Hong Kong, etc have been making a living off of this type of thing for decades.
So 4% of 10 is more then 20% of 5?
 
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maxo-texas wrote:
This is going to kill apple's stock price which will kill apple executives tax fraud based bonuses.

It's not having that effect so far, the opposite has actually happened.

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The rally is due to the new iPhone 7 being well received at the same time as Samsung recall the top of their product line. But yeah, Apple is not going anywhere on the basis of one tax bill.
 
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