Apple Argues Paying More Than A 0.005% Tax Rate Is ‘Unfair’ – Forbes

The contention from the Commission appears to be that, even though there were no written agreement, the shockingly low tax rate (apparently 0.005% in 2014) suggests that there was a de facto arrangement. When the European lawyers began to look at Apple’s convoluted tax structures, shifting money between shell entities and a ‘head office’ that didn’t employ staff, possess facilities or even have a registered address in any country, it appeared that there was the blatant breach of tax codes.

By looking into these structures, the EC was effectively doing the job that the Irish tax authorities should have done years ago. Had Ireland engaged in a cursory investigation into Apple’s tax affairs, these anomalies would have been identified and a new tax bill drawn up.

Ireland in fact made a number of tax rulings to assign Apple’s tax center to its ‘head office’. That this facility was a stateless fiction appeared irrelevant to Irish authorities.

Apple has always claimed that the company never broke the law regarding taxes. The company exploited loopholes, and used very complicated networks of shell companies, but they have always claimed it was legal. This article suggests that “there was blatant breach of tax codes” because Apple did not report all its income.

It’s one thing to take advantage of the situation and do something that’s morally wrong, but if what Apple did was illegal, then they no longer have the high ground in this case.

Source: Apple Argues Paying More Than A 0.005% Tax Rate Is ‘Unfair’

4 thoughts on “Apple Argues Paying More Than A 0.005% Tax Rate Is ‘Unfair’ – Forbes

  1. This article is giberish:

    “The EU argues that “almost all profits” on Apple sales in Europe were funnelled through its Irish subsidiaries and given the convention that profit-centres should be the territory in which tax is paid, a 0.005% rate was ludicrous. In 2011, Apple recorded profits of $22 billion in Ireland (approximately 16 billion), but only €50 billion was taxed, yielding an effective tax rate for that year of 0.05%.”

    WTH is the numerator and denominator that yields 0.05%? Why does the headline quote a percentage one-tenth of that amount (0.005%)?

    Note that the above quote blithely mixes dollars and euros.

    If somebody can show audited financial statements and as-filed tax returns, then we might get some reliable numbers. As it stand, we’ve got a journalist babbling and hand-waving.

  2. This article is giberish:

    “The EU argues that “almost all profits” on Apple sales in Europe were funnelled through its Irish subsidiaries and given the convention that profit-centres should be the territory in which tax is paid, a 0.005% rate was ludicrous. In 2011, Apple recorded profits of $22 billion in Ireland (approximately 16 billion), but only €50 billion was taxed, yielding an effective tax rate for that year of 0.05%.”

    WTH is the numerator and denominator that yields 0.05%? Why does the headline quote a percentage one-tenth of that amount (0.005%)?

    Note that the above quote blithely mixes dollars and euros.

    If somebody can show audited financial statements and as-filed tax returns, then we might get some reliable numbers. As it stand, we’ve got a journalist babbling and hand-waving.

  3. They never had the moral high ground in the EU, their convoluted structure (and idem ditto for many other big USian + Japan + … multinationals) has been known for ages (I remember reading detail analysis years ago in a trade union publication), and the lack of serious checking by the relevant tax-authorities (Ireland in the Apple case) was certainly not unknown.

    I had to laugh hard the other day when the USgov issued an uppity statement condemning the EU for looking into the matter.

  4. They never had the moral high ground in the EU, their convoluted structure (and idem ditto for many other big USian + Japan + … multinationals) has been known for ages (I remember reading detail analysis years ago in a trade union publication), and the lack of serious checking by the relevant tax-authorities (Ireland in the Apple case) was certainly not unknown.

    I had to laugh hard the other day when the USgov issued an uppity statement condemning the EU for looking into the matter.

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