Irish Government May Close Apple's Biggest Tax Loophole 292
DavidGilbert99 writes "Ireland and its tax system came under some extreme scrutiny earlier this year when it was revealed that Apple funneled billions of dollars of revenue though three subsidiaries based in the country. Thanks to a loophole, none of these subsidiaries were tax-resident in Ireland, meaning they didn't even have to pay Ireland's relatively low 12.5% corporation tax rate. Worryingly for Apple, Ireland's finance minister may now shut this loophole. A measure within a new budget bill (PDF) would disallow Apple's status as a 'stateless' corporate entity for tax purposes. Apple will still be able to select a country like Bermuda as its tax residence, but it's a step in the right direction."
job killing regulations (Score:4, Interesting)
apple will just move to the next free zone
Re:Tax everywhere (Score:4, Interesting)
I don't understand why countries like Ireland or Bermuda or wherever don't all just charge a small tax of some kind (like say 5%) that keeps the companies coming there, but gets them tons of money.
Because that would quickly turn into a race to the bottom. If Ireland charged 5%, then Bermuda would charge 4%, so Ireland would lower theirs to 3% .... The only Nash Equilibrium [wikipedia.org] is zero.
What does Bermuda get out of having Apple "based" in Bermuda if they don't get any tax revenue?
They get corporate registration fees, and jobs for a few lawyers and administrators. That is better than nothing.
Re:What an obnoxious and biased write up (Score:1, Interesting)
A step in the right direction would be expanding tax shelters so that us little people can use them too, not just the big boys.
To draw a parallel, we should just let stateless people wander around and do whatever they please like Apple, rather than confine them to an airport.
Re:Tax Avoidance (Score:4, Interesting)
My family owns Apple shares and I think it's wrong.
Pay American taxes, or lose American support (Score:4, Interesting)
Why does Apple get to lobby the government or expect the support of the government when they won't pay for it?
Maybe the next time Apple has a patent dispute, the Chinese authorities embargo their product at the docks, or the EU starts making demands the US government should tell them to sit down and take a number.
I love how corporations and the rich hate the government and won't pay for it until they need it to do their bidding.
Re:Because Apple (Score:5, Interesting)
Apple was a pioneer of an accounting technique known as the “Double Irish With a Dutch Sandwich,” which reduces taxes by routing profits through Irish subsidiaries and the Netherlands and then to the Caribbean. Today, that tactic is used by hundreds of other corporations — some of which directly imitated Apple’s methods, say accountants at those companies.
http://www.nytimes.com/2012/04/29/business/apples-tax-strategy-aims-at-low-tax-states-and-nations.html?_r=0 [nytimes.com]
Apple literally invented the technique.
Others followed to compete.
Personally, I support any and all means of tax avoidance, so I don't count it against them. But I love bursting Apple Fanboys bubbles.
Re:Pay American taxes, or lose American support (Score:2, Interesting)
Why does Apple get to lobby the government or expect the support of the government when they won't pay for it?
Apple paid more in corporate taxes to the American government than any other company (iirc, they cut the US Treasury a check for $6 BILLION).
Sorry to ruin your rant with facts...
Re:Because Apple (Score:4, Interesting)
That sounds unreasonable. I could understand if you had to pay the US government $1500 or something (5% of 30000). But why would you have to pay taxes over something someone else has already taxed you on?
Ah, the theory of Immaculate Taxation! That corporate and investment income originates in the sanctified state of "already having been taxed" which frees it from ever having to pay a penny of taxes ever again. Indeed a mere penny of taxation levied on a million dollar revenue stream somewhere along the line makes it immune from ever having to bear taxes again (or at least if holy taxation writ were faithfully observed).
Re:Tax Avoidance (Score:4, Interesting)
Just curious. Do YOU pay more taxes than you're legally obligated to?
If not, why not?
You've just stated that you "think it's wrong" that Apple pays no more taxes than they're legally liable for. Which would make YOU wrong for not paying extra taxes.
Whoa. You're confusing "It's wrong because ethically it stinks" with "It's wrong because it's against the law".
It IS wrong that multibillion dollar corporations are unfairly paying cellar-level taxation for large profits made from consumers. Just because corporations own governments around the world and have enshrined that unfairness in taxation law to benefit themselves does not suddenly make that right.