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Who bit the Apple?
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It's a big problem all over the world. Big biz is always on the look out for a free ride. And, guess who pays? If the US businesses paid their share, thing could be much better for everyone. But, we all know that. The problem is we do nothing. And I don't think DT can either. He likes living too much. And the same way with HC.
GR wrote: "It's a big problem all over the world. Big biz is always on the look out for a free ride. And, guess who pays? If the US businesses paid their share, thing could be much better for everyone. But, w..."True and it's not only about US businesses. The problem is global and encompasses trillions of dollars..
Really, 15.4 billion USD? Apple is gonna pay back taxes in Europe?That's what seemingly the Irish Finance Minister announced: https://ca.reuters.com/article/busine...
Is it a harbinger?
In escrow as an investment whilst it spends another 5 years being dragged through courts. No benefit to Irish tax payers nor anyone else.
Apple makes a lot of sales in the EU and presumably pays VAT. If its tax returns do not correspond to the VAT it pays, that would be evasion, not avoidance, so this case could be something of a nightmare. I don't know what the EU does, but in NZ if there is a dispute with the IRD, while the dispute goes on, if you lose, there is a fierce interest payment over the time of the dispute, so it pays to settle promptly unless you are very sure of victory.
And now Apple is apparently going to bring (some of) its offshore revenue into the US to take advantage of Trumps tax break
Will the tax break, then, translate into a boon for the middle class in the U.S.?
Scout wrote: "Will the tax break, then, translate into a boon for the middle class in the U.S.?"The real beneficiaries are the rich. Don't expect a trickle down - it trickles up.
Philip wrote: "And now Apple is apparently going to bring (some of) its offshore revenue into the US to take advantage of Trumps tax break"That's an intended purpose. I see a lot of sense in the tax reform in the aspect of lowering corporate tax to make US taxation attractive and competitive again, however I'm not sure how wise it is to let offshore profits off the leash completely. I'd rather see those international corporations paying part of those 2-3 trillions dollars sitting abroad to the US public for outsourcing jobs elsewhere. Something like tax amnesty for a fee (a certain tax)
Then we still have the issue of companies amassing revenue in one country charging for services in another and holding money in a third as a way of avoiding tax. The EU forced Ireland to charge Apple €13 Billion in back tax as all EU profits were routed via Ireland who then did not charge the actual legal corporation tax rate only 10% I believe but Apple paid an effective 0.3%. If all the money held in Lichtenstein etc. is sent (not repatriated as it was not made in US) for a one off deal in the US what happens to those fines and back taxes? The EU money is unlikely ever to be charged anyway disappearing into legal dispute for years.The Apple Shareholder will receive a one off bounty and Apple has promised to expand operations in the US (probably have done that anyway) but only after the state or local government adds in some redevelopment zone sweeteners thus refunding what little tax Apple is now paying in lower set up costs
Welcome to the merry go round where the only dizzy ones are taxpayers and consumers. They'll be no trickle down effect, there never is.
BTW - Apple is no better or worse than the rest of these organisations and the tech giants are no worse than Ford or other major global companies. Shift car production anyone. We can make it using cheaper labour in India/China/Poland/Mexico unless you give us development funds for the factory and a tax break we'll go elsewhere.Of course the support the local community with a new playground (cost £100k) whilst pocketing the £100m development grant.
It seems to me there needs to be law that requires the income to be declared in the country where the people paid for the services, with offsetting costs verified. There then needs to be clear law so the whole process cannot be bogged down with silly appeals, and make the top executives in a country criminally liable for proper accounting. My guess is the threat of time in a maximum security prison would persuade most executives to comply. The real problem is, what is going on now is more or less legal, thanks ot the ineptitude of the lawmakers.
Philip wrote: "Then we still have the issue of companies amassing revenue in one country charging for services in another and holding money in a third as a way of avoiding tax...."Yep, i think this is one of the most acute problems we have. Business went global much faster than anyone else, incl. authorities. Different approach to taxation, makes tax 'shopping' very easy and lucrative for big biz. The situ changes, but while it does, those who already have trillions untaxed will get away with it nicely and further render chances of future competitors slimmer. Moreover, cynic as it may be - once they are prepared they'd be advocating for the most strict and rigorous approach to international taxation)
http://fortune.com/2016/08/31/apple-e...
https://www.theguardian.com/business/...
http://fortune.com/2016/09/05/eu-appl...
Kinda unprecedented on EU's part, but barely taxed billions of profits in sales also don't sound fair, especially when it's an almost exclusive privilege...
Certainly, it's not the end the process, but just the beginning of appeals, bargaining and so on.
What's your guess: settlement? Do you think the tax schemes allowing avoidance shall remain legit or this phenomenon, available for a rather exclusive club of multinational corporations, shall be dealt with?