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News EC ruling puts Apple on the hook for €13 billion tax bill

Discussion in 'Article Discussion' started by Gareth Halfacree, 30 Aug 2016.

  1. rollo

    rollo Modder

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    That's the way of life ? Unless you work for the government or a small business you will find they are paying substantially less tax than you are.
     
  2. DragunovHUN

    DragunovHUN Modder

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    Well, paying taxes is pretty much all the value that a lot of people can offer in this context. Big companies are creating jobs and generally boosting the economy, plus, they're likely to go elsewhere if you let them have a reason to.

    I never thought about it before but it makes sense to me, it's just supply and demand like it usually is. If your country was swimming in tech and automotive manufacturers and they were struggling to hire enough people, suddenly the incentives would start to get turned towards you.
     
  3. impar

    impar Minimodder

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    Greetings!
    Apples :)p) and oranges. Companies revenues taxes are usually fixed, individuals are usually progressive.
    A company will always pay 12,5% (lower a bit with some tax breaks) if it makes 1.000.000 or 100.000.000, an individual can pay 0%, 12,5% or 40+%, depending on the revenues.
    Why should you pay 40% (and for that your revenue has to be in what level?) and your much higher revenue neigbour pay 0,016% (same ratio)?
     
  4. Gareth Halfacree

    Gareth Halfacree WIIGII! Lover of bit-tech Administrator Super Moderator Moderator

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    Technically, your employer is paying that 40% on top of the 12.5%. Income tax is factored in to your salary: you might be earning £50,000 on paper, but you're *actually* earning that figure minus tax. When you're budgeting, you budget based on your post-tax income, right? That's what the company has to do: it has to inflate its salaries by 40% in order to actually get staff; if it costs £30,000 to live in your area and salaries were £30,000 before tax, nobody could afford to work for the company. If you're PAYE, you don't even technically pay it: your employer pays it before the money ever reaches you. (I'm Self Assessment, so I *do* pay income tax - but I don't actually have an employer, and I don't pay corporation tax 'cos I'm not a corporation, so that's all different.)

    As others have mentioned, though, comparing two different taxes is a mug's game. You might as well ask why you pay no tax on a book but 20% tax on a chocolate bar; There Are Reasons, but they're boring ones of interest only to accountants and Her Majesty's Revenue & Customs. Oh, and if you want to get really worked up, have a look at the tax rate on spirit alcohol...
     
  5. Anfield

    Anfield Multimodder

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    Job creation is used as a perfectly valid argument by big companies to get a rebate on taxes from governments, governments give them the rebate and in return the governments protect the big companies from any new competitors by not extending those same tax rebates to smaller businesses.

    Unless you want to go for a really radical solution like for example abolishing corporation tax on a global scale that problem will never be solved.
     
  6. theshadow2001

    theshadow2001 [DELETE] means [DELETE]

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    I was mostly being facetious/sarcastic with the tax comment, I didn't think anyone would take the time to reply. Sorry about that.
     
  7. Gareth Halfacree

    Gareth Halfacree WIIGII! Lover of bit-tech Administrator Super Moderator Moderator

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    Never apologise for giving me a reason, however tenuous, to be doing something other than work.
     
  8. theshadow2001

    theshadow2001 [DELETE] means [DELETE]

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  9. MightyBenihana

    MightyBenihana Do or do not, there is no try

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    OK I will probably not explain this very well but your theory is flawed.

    Corporate tax rates have gone down since the 80's and with it wealth inequality has gone up. Personal tax rates now make up for the shortfall created by the reduction in corporate tax rates. Large corporations are the biggest welfare queens out there. Your theory exists in a world that is not like the one in reality, with lobbyists and politicians who are looking to get paid by the corporations after the leave office and corporations looking to fulfill quarterly targets to shareholders etc.

    Corporate profits are through the roof and this money is not usually recirculated, it is banked off shore (either by the corporation or the highly paid executives) and essentially becomes dead money, as in it is removed from the economy. The top 50 US companies hold $1.4 trillion off shore, and that just the top 50. That is $1.4 trillion in dead money.

    These low corporate tax rates come from the idea of trickle down economics which by every measure is a failure unless you are in the top 1%. Productivity of workers has gone up but wages are suppressed and tax rates raised.

    Let me give you an example:

    You are a millionaire/billionaire. How many cars and TVs etc do you buy. Maybe 5 or 6. You get a tax cut. How much more often do you go out to a restaurant or the cinema? How many more cars or TVs do you buy? I doubt it would change, and even if it did it would not be on a scale large enough to really effect measures of demand. What do you do with the extra money you get? Nothing, you don't need it. You may buy a new yacht but again this is not an macro economy effecting purchase.

    Now imagine you are on £20k a year. You get a tax cut and now have an extra £2k a year. What is that spent on? Many things, it probably wont be saved. It is recirculated into the economy, which in turn creates demand which creates job, especially when it is multiplied over 100's of thousands of people.

    Companies don't hire people because they want to, they do it because they have to to meet demand. Just because they have more money doesn't mean they hire more people and demand is reduced massively when the disposable income of the population is reduced.

    Remember, big companies may create jobs but it is your labour that boosts the economy as well, and about half the labour force is employed in small to medium businesses that rely on people spending their disposable income to survive.

    I probably haven't explained myself very well but here are some important economic ideas you should look at:

    https://en.wikipedia.org/wiki/Velocity_of_money

    https://en.wikipedia.org/wiki/Trickle-down_economics#Criticisms

    http://www.epi.org/publication/unde...-workers-pay-why-it-matters-and-why-its-real/
     
  10. rollo

    rollo Modder

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    Further to this, Ireland has said they do not want the money even if they lose the appeal. Which leaves the EU commision with a problem. They cannot collect the cash themselves. And from what I gather they cannot force Ireland to take it.

    So even if both Ireland and Apple lose Appeals Apple could still pay a net 0 lol.

    Ireland are scared of mass job exodus which would do more harm than the 13billion euro they would recieve would do.

    Google is next, The 2 combined could owe as much as 20billion euro in taxes lol.

    And the UK could match Irelands 12.5% rate once we leave the EU if most reports are accurate.
     
  11. rollo

    rollo Modder

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    Appeal time will take 6 years to process. Go through both the General court and the European Court of Justice.
     
  12. geogan

    geogan What's a Dremel?

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    From the Irish point of view this is how we see it.

    America & american corporates = our friend and ally, speaks our language similar culture and customs and puts money into the country.

    EU and commission = not our friend, speaks foreign language and own alien cultures and customs. Takes money out, absolutely obliterated the entire country by shouldering our country with entire European banking debt (which was not OUR debt - we will never forget/forgive EU for this - this alone literally took €300 a month out of my monthly wages). Wants to take our jobs and steal US companies from us too for their own greedy benefit. **** them and the boat the rode in on.
     
  13. Corky42

    Corky42 Where's walle?

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    Thank goodness it wasn't down to widespread failures in financial regulation, including the Federal Reserve’s failure to stem the tide of toxic mortgages then, and those EU banks should have stuck that €64 billion bailout where the sun don't shine, because I'm sure Ireland's banking crisis would've just sorted itself out.
     
  14. theshadow2001

    theshadow2001 [DELETE] means [DELETE]

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    I hardly think the yanks are our friends. This dependence on foreign investment is a house of cards and a few more knocks like this and it will start to come apart. Instead of developing our own industry we're just building stuff for the Americans and as soon as the tax situation changes due to internal or external forces, it will come tumbling down and those friendly Americans will start looking for some other country to not pay tax in. The result will be a massive knowledge labour force and no one to employ them.

    I think the paying back of unsecured bond holders is the big sticking point for the Irish public in terms of the banking bail out. Well that and the reckless banking that saddled us with enormous debt.
     
  15. geogan

    geogan What's a Dremel?

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    Exactly. The UNSECURED bondholders made a bet and lost, not the Irish taxpayers. They should NEVER have been paid back, but the EU forced the payback, why?, because the unsecured bondholders were them and their own banks. Funny isn't it how the EU likes to change the rules of the game when it suits thenmselves doesn't it? Just like forcing to pay back more tax than was legally required in those years... and forcing Irish to be tax collectors for other EU countries.
     
  16. Corky42

    Corky42 Where's walle?

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    Those unsecured bondholders were US bondholders and the reason taxpayers (across the world) lost is because the alternatives were far worse, yes it sucks but it's the result of deregulating the markets, something that afaik has still not been addressed.

    The EU didn't force anything, the Irish government forced the bailout to prevent the collapse of Ireland's two main banks from spreading.

    What rules would they be?

    The Irish government signed up to the EU agreement that says members will not offer state aid to business, (not having read the state aid rules) there's no illegality involved but if you're not going to follow the rules of membership then you should expect consequences, and as the tax payer can't pay themselves back the money they've lost there's only one other option.

    Additionally, and unless I've missed something, the EU isn't forcing the Irish to be tax collectors for other EU countries, it's forcing Ireland to collect the correct amount of tax, granted a small percentage of that adjusted amount may well end up being paid in EU membership fees but the majority is public money, money the Irish government in effect stole from the Irish public.
     
  17. rollo

    rollo Modder

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    It's not a small amount if reports are accurate 80% of the cash is from outside of Ireland. Ireland could owe more out than they get themselves.
     
  18. Anfield

    Anfield Multimodder

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    Without the tax rebate Apple would have set up shop elsewhere and the people currently employed there would be back on the Irish jsa.
     
  19. Corky42

    Corky42 Where's walle?

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    I've not looked into any of that, I'm guessing most of it would be paying of debts, although I'm happy to be corrected if you can provide a link or something.

    And you know that how?

    Besides shouldn't a country be trying to attract business via other means than just giving companies free money from the public's pockets, because that's what Ireland in effect done, they provided Apple with, what i assume, is a highly skilled, healthy workforce, along with all the infrastructure, things like gas, electric, water, roads, rail, waste disposal.

    What it seems you're suggesting is the public should provide all that for free just for the chance a small percentage of them may get a job so they can pay for it all.
     
  20. Anfield

    Anfield Multimodder

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    Basic logic, if Ireland would not have offered them a big fat rebate then some other country would have done so.

    Not suggesting it is fair, but when has life ever given a damn about fair?
     

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