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'It's Tricky': Apple Misses the Deadline To Pay $13.9 Bn To Ireland in Illegal Tax Benefit (cnbc.com) 174

Apple has not fully paid the 13 billion euros ($13.9 billion) it owes to Ireland in illegal tax benefits even though the deadline has passed, the European Union's competition said on Tuesday. From a report: "Well the recovery is not done yet but we have been working with the Irish authorizes and we can see that they are moving forward to do the recovery of the unpaid taxes," EU Competition Commissioner Margrethe Vestager said during a press conference in response to a question by CNBC. "It's a tricky thing to do because it's a large sum so of course you have to figure out how to do that. It's not as an escrow account in some of the other cases where it might be 25 or 30 million euros ... and therefore I do respect that it's a complicated matter and it may take a little more time. Last year, the Commission ruled that Ireland must recover 13 billion euros in "illegal tax benefits" from Apple. It found that the U.S. technology giant paid an effective tax rate of 0.005 percent in Ireland in 2014.
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'It's Tricky': Apple Misses the Deadline To Pay $13.9 Bn To Ireland in Illegal Tax Benefit

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  • Cant pay (Score:5, Insightful)

    by rainmouse ( 1784278 ) on Tuesday January 31, 2017 @09:05AM (#53773451)
    Hard to free up cash when all your money is hidden in holding companies, dodgy schemes and tax havens.
    • by Anonymous Coward
      So it's already in Ireland? That should make it easier.
      • Re:Cant pay (Score:5, Insightful)

        by Plumpaquatsch ( 2701653 ) on Tuesday January 31, 2017 @11:20AM (#53774505) Journal

        So it's already in Ireland? That should make it easier.

        Well, when the country you are supposed to pay it to refuses to accept it, that is a pretty big problem. http://www.bbc.com/news/world-... [bbc.com]

        BTW, why is a failure to meet a Jan. 3rd deadline suddenly in the news? Even the EU bureaucracy isn't that slow.

        Interesting tidbit: if they dumped the money in front of the Irish treasury as 500 Euro bills, that would be over 29 metric tons of paper, with a volume of about 34 cubic meters. It seems that would be slightly more than fits into a 20' shipping container - but you would need at least two anyway, because of the weight limit on trucks. So yeah, they could do that - if they can find somebody to sign the receipt. (http://www.fondations.net/weight-from-500-euro-note-informative/ [fondations.net])

    • Re:Cant pay (Score:4, Interesting)

      by rmdingler ( 1955220 ) on Tuesday January 31, 2017 @09:35AM (#53773659) Journal

      Hard to free up cash when all your money is hidden in holding companies, dodgy schemes and tax havens.

      While missing a payment deadline, I once told the electrical people my money was all tied up in fast times and poor decisions.

      Despite the chuckle it elicited, their level of compassion could be measured by the $12 late fee on a $144 light bill.

    • Clearly the problem is the cheque still requires Steve Jobs signature and they haven't got the right coloured (yes I'm british) crayon
  • I wish... (Score:4, Interesting)

    by Quakeulf ( 2650167 ) on Tuesday January 31, 2017 @09:06AM (#53773459)
    I could just say "it's tricky" when the state comes to tax my business to hell and beyond. I pay 51% tax in total on my business entity here in Norway. If I try to fight this unjust practice against SMEs here in Norway they'll just ignore me.
    • Re:I wish... (Score:5, Insightful)

      by JaredOfEuropa ( 526365 ) on Tuesday January 31, 2017 @09:23AM (#53773569) Journal
      And that's why such tax evasion is a bad thing: it's unfair competition. I hate taxes as much as the next guy and I would like to "avoid" them where I can. But in practise tax evasion and the secret tax rulings that are so popular in my country (which puts the Dutch in the Double Dutch Sandwich) are accessible only to large entities. As a small business owner paying 25-50% tax, how are you supposed to compete against companies that end up paying 0.005%?
      • by AvitarX ( 172628 )

        The company I work for competes by not being profitable (well only a few percent).

        In the US at least, only profits are taxed, and we pay employees with them where I work.

        • Re:I wish... (Score:4, Interesting)

          by Tomahawk ( 1343 ) on Tuesday January 31, 2017 @09:51AM (#53773759) Homepage

          In the US at least, only profits are taxed.

          Same in the EU, and everywhere else that I know of. The 13bn owed here is taxes on profits made by Apple across Europe over a period of a few years. So you can imagine just how much profit they actually made!

          Normal corporation tax rate in Ireland is 12.5%, which tells us that Apple made profits in excess of €100bn over those years in Europe.

        • As is the case pretty much everywhere, paychecks are taxed MORE than corporate profits, except in a very specific case.

          The employer pays unemployment taxes and 7.65% FICA, the employee pays 7.65% FICA, and the employee pays income taxes. Total tax rate on money paid to employees as compensation is around 41%. Much of that is not subject to deductions and credits.

          Corporate tax is 34% of the amount over $335,000, with lower rates for the first $335,000.

          One big thing the IRS watches out for is businesses payin

      • Re: (Score:2, Insightful)

        I hate taxes as much as the next guy and I would like to "avoid" them where I can.

        Yeah you hate taxes but you love the civilisation that they buy. If you really hate taxes, you can always move to the Libertain Paradise of the Congo where the government pretty much doesn't have the werewithal to collect taxes to any significant degree. Of course then you have you have to put up with living in a non functional country and so provide everything for yourself.

        I like taxes because I like living in civilisation.

        • Re:I wish... (Score:5, Interesting)

          by drinkypoo ( 153816 ) <martin.espinoza@gmail.com> on Tuesday January 31, 2017 @10:10AM (#53773863) Homepage Journal

          I like taxes because I like living in civilisation. I am happy to contribute my bit.

          I will not lie and pretend I like paying taxes. I like getting what they give me, and if I can get that for less money, I will. It's the same principle upon which big business works, and if it's good for them, then it's surely good for me.

          Contributing my bit is not really the problem. Being asked to contribute someone else's bit because they are evading taxes, or because they are purchasing legislation which permits them to avoid them instead while I still am expected to pay them, that is the problem.

          • Contributing my bit is not really the problem. Being asked to contribute someone else's bit because they are evading taxes, or because they are purchasing legislation which permits them to avoid them instead while I still am expected to pay them, that is the problem.

            I 100% agree there.

          • You and I may not always agree, but fuck that was well said.

        • "Yeah you hate taxes but you love the civilisation that they buy. If you really hate taxes, you can always move to the Libertain Paradise of the Congo where the government pretty much doesn't have the werewithal to collect taxes to any significant degree."

          Nice straw man. Only a small fraction of my total taxes pay for roads, police, and schools, the cornerstones of civilization.

          Somehow Ike ran the US spending less than 15% of the GDP on federal government. Remind me again why a more modern US Government req

          • The tax rates for the rich back then were a whole lot higher than they are today. Plus GDP increases when doing a lot of construction like highways. It's one reason why the Chinese GDP keeps growing to quickly.

      • Re:I wish... (Score:5, Insightful)

        by kimvette ( 919543 ) on Tuesday January 31, 2017 @10:11AM (#53773869) Homepage Journal

        > As a small business owner paying 25-50% tax, how are you supposed to compete against companies that end up paying 0.005%?

        You're not, and that is by design.

      • As a small business owner paying 25-50% tax, how are you supposed to compete against companies that end up paying 0.005%?

        You are paying tax _on profits_. So the tax rate does not at all affect whether you or Apple are profitable. And as a small business owner, you are free to increase your salary, and then you don't pay any tax at all.

    • If I try to fight this unjust practice against SMEs here in Norway they'll just ignore me.

      How is making a company pay the same tax that everyone else has to pay an unfair practice?

    • Apple might have better luck after the Populist Revolution sweeps Europe this year.
      • by Muros ( 1167213 )

        Apple might have better luck after the Populist Revolution sweeps Europe this year.

        It won't in Ireland. We have a centrist (or leftwing if you're American) minority government propped up by their biggest opponents, another centrist party. Irish people (notwithstanding recent terrorist history) are generally not fond of any form of extremism.

  • by The-Ixian ( 168184 ) on Tuesday January 31, 2017 @09:09AM (#53773487)

    I know that people are working overtime at Apple to come up with this solution but here are some ideas for you:

    - Giant novelty check
    - Mountain of pennies
    - Unsold Apple watches
    - Briefcase full of "iBucks"
    - "Hey what's that?!" *run away*

    • by Nidi62 ( 1525137 )
      Maybe offer to buy everyone in Ireland a cask of Irish whiskey and a round of Guinness?
    • by Tomahawk ( 1343 )

      - A giant novelty cheque would be cool. And it's still legal!

      - A mountain of pennies (or cents, as we no longer have pennies in Ireland) would not be legal tender.: The following is an extract from the Economic and Monetary Union Act, 1998: “10(1) No person, other than the Central Bank of Ireland and such persons as may be designated by the Minister by order, shall be obliged to accept more than 50 coins denominated in euro or in cent in any single transaction.”. I suppose they _could_ do i

  • I know it sounds crazy, but last i heard the Irish government refused the money. Has that changed? Ireland is a very interresting place to do international business and i suppose this backtax issue is something Google and Amazon are paying very close attention to.
    • by Opportunist ( 166417 ) on Tuesday January 31, 2017 @09:38AM (#53773687)

      The very LAST thing Ireland really wants is to enforce this law. For good reason. Right now they get a bit of the cake, but they get a bit of the cake from everyone because every company, from Apple to Amazon to MS to Google, is hiding in their tax shelter.

      If they now actually fold (and yes, that would be Ireland folding to EU pressure), what reason is there for them to stay in Ireland? The weather?

      • The very LAST thing Ireland really wants is to enforce this law. For good reason. Right now they get a bit of the cake, but they get a bit of the cake from everyone because every company, from Apple to Amazon to MS to Google, is hiding in their tax shelter.

        If they now actually fold (and yes, that would be Ireland folding to EU pressure), what reason is there for them to stay in Ireland? The weather?

        They still have the lowest corporate tax in the EU at 12.5% the companies would just have to pay that instead of 0.02%.

        • by Carewolf ( 581105 ) on Tuesday January 31, 2017 @10:45AM (#53774181) Homepage

          The very LAST thing Ireland really wants is to enforce this law. For good reason. Right now they get a bit of the cake, but they get a bit of the cake from everyone because every company, from Apple to Amazon to MS to Google, is hiding in their tax shelter.

          If they now actually fold (and yes, that would be Ireland folding to EU pressure), what reason is there for them to stay in Ireland? The weather?

          They still have the lowest corporate tax in the EU at 12.5% the companies would just have to pay that instead of 0.02%.

          Plus Ireland already ARE enforcing the tax again. The scheme was found illegal by Ireland's own supreme court, Ireland just said: We didn't know it was illegal so were are not going to be charging back taxes on the error. Where as EU have found letters between Apple and Ireland discussion wether or not they would accept the legally wrong scheme, and since Ireland did, have said that is illegal state aid, and thus they must collect back taxes and not just new taxes.

          The only reason Ireland is not happy to charge the back taxes is either: a) pride or b) corruption.. or maybe c) both.

        • Still. Small steps, we're talking about a bureaucratic juggernaut, be glad that glacier it's moving at all.

        • The very LAST thing Ireland really wants is to enforce this law. For good reason. Right now they get a bit of the cake, but they get a bit of the cake from everyone because every company, from Apple to Amazon to MS to Google, is hiding in their tax shelter.

          If they now actually fold (and yes, that would be Ireland folding to EU pressure), what reason is there for them to stay in Ireland? The weather?

          They still have the lowest corporate tax in the EU at 12.5% Apple would just have to pay that instead of 0.02

      • If they now actually fold (and yes, that would be Ireland folding to EU pressure)

        "Fold" is a curious way of putting it. I mean I guess it fits, but it gives a rather odd impression. It's like saying you fold to pressure from the police not to do 90 in a 30 zone.

        Or, actually, more like you fold to pressure from your landloard to pay rent.

      • Post brexit they would be the only EU country with native english speaker. I expect their business to boom , come April.
        • The fun part is that, come Brexit, English is potentially not going to be an official language of the EU anymore.

          That's going to be interesting.

      • by AmiMoJo ( 196126 )

        Even without the tax dodge, Ireland has one of the lowest corporation tax rates in the EU. And they speak English as a first language, which helps.

        In fact some UK companies, particularly financial institutions, are looking at moving to Ireland now. It might not be as great as it once was, but it's still the cheapest way to be in the EU.

        • They may speak English as their first language, but trust me, you understand the English of any Swede or Finn better than theirs.

          Old Joke: The main difference between Swedes and Californians? They look? No, they look the same, but the Swedes speak the better English. Same with a lot of Irish.

    • Ireland would like to keep Apple in Ireland even paying little to no tax, because of the amount of tax the support systems pay. If Ireland were forced by the EU to take 13 billion off Apple, then they will have to take it, but who knows what Apple's next move will be? They are moving a lot of operations from Luxemburg to Ireland, but that might all change if they have to start paying regular tax.

    • If Apple is forced to pay the $13 billion, Ireland is unlikely to see any of it. Firstly, other EU countries would go after Apple for a share and also Apple could declare the tax in the US instead.
      https://www.theguardian.com/bu... [theguardian.com]

      • oops.. picked the wrong mod option.. sorry there, meant informative and accidentally clicked flamebait.
        I sure wish /. had an "undo" option for moderation.
  • Escrow (Score:5, Informative)

    by Tomahawk ( 1343 ) on Tuesday January 31, 2017 @09:24AM (#53773581) Homepage

    They missed a deadline to have the money in an escrow account. With the ongoing legal challenges, the money would stay in the escrow account until such time as it is decided whether they have to pay the taxes, or they can take the money back. This wasn't a deadline to pay the tax itself.

    https://www.rte.ie/news/2017/0... [www.rte.ie]

  • She must at least have one king size Tullamore Dew in her bar cabinet by now.

  • It's not like you have to stuff greenbacks into coffers, you ain't bribing politicians to avoid taxes, you're paying taxes. I know you're not used to this, Apple, but trust me, this can be done by a simple wire transfer.

    Cough up the dough! Under normal circumstances a horde of officials would now storm your house and steal everything in sight but a bed and maybe a TV. Why not this time? Tax officials are usually not very approachable when it comes to seizures.

  • European Union's competition said

    Eh? Editors edit much?

  • fuck Apple (Score:1, Troll)

    by AndyKron ( 937105 )
    Fuck Apple, and all Apple products
  • It's tricky, you see you already make me pay "Income Tax" on the money that I make, but then you also tax me a "sales tax" on the things that I buy... but I can't buy things without an income, so I messed up this double-taxing concept and didn't have enough money budgeted. I'm sure you understand.
  • by nospam007 ( 722110 ) * on Tuesday January 31, 2017 @10:48AM (#53774213)

    Even Al Capone learned, that either you pay your taxes or you go to jail.

  • by belthize ( 990217 ) on Tuesday January 31, 2017 @11:42AM (#53774707)

    Just treat it like any normal tax agency would treat it with late fees calculated on a prorated monthly basis.

    If they were looking at 1B Euro penalties I'm pretty sure they'd have paid on time.

  • Last year, the Commission ruled that Ireland must recover 13 billion euros in "illegal tax benefits" from Apple.

    Ireland had to be forced to collect these taxes. They didn't want to do it.

    The whole thing is weird.

  • It's Tricky to dodge taxes, to dodge taxes that's right on time. It's TRICKY!
    • by Anonymous Coward

      It's tricky to pay a dime, to pay a dime that's right on time. It's TRICKY!

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