{"id":44817,"date":"2024-09-11T16:04:56","date_gmt":"2024-09-11T20:04:56","guid":{"rendered":"https:\/\/mjtsai.com\/blog\/?p=44817"},"modified":"2024-09-19T08:47:27","modified_gmt":"2024-09-19T12:47:27","slug":"apple-loses-ireland-tax-case","status":"publish","type":"post","link":"https:\/\/mjtsai.com\/blog\/2024\/09\/11\/apple-loses-ireland-tax-case\/","title":{"rendered":"Apple Loses Ireland Tax Case"},"content":{"rendered":"

Arjun Kharpal<\/a> (ruling<\/a>, Hacker News<\/a>):<\/p>\n

Europe’s top court ruled against Apple on Tuesday in the tech giant’s 10-year court battle over its tax affairs in Ireland. The case stems back to 2016 when the European Commission ordered Ireland to recover up to 13 billion euros ($14.4 billion) in back taxes from Apple.<\/p>

[…]<\/p>

Apple said in a filing on Tuesday<\/a> that it will incur a one-time income tax charge of about $10 billion in its fourth fiscal quarter ending Sept. 28, 2024.<\/p><\/blockquote>\n\n

Charlotte Edwards and Theo Leggett<\/a> (via John Gruber<\/a>):<\/p>\n

\n

The original decision covered the period from 1991 to 2014, and related to the way in which profits generated by two Apple subsidiaries based in Ireland were treated for tax purposes.<\/p>\n

Those tax arrangements were deemed to be illegal because other companies were not able to obtain the same advantages.<\/p>\n

[…]<\/p>\n

Apple said in a statement: \"This case has never been about how much tax we pay, but which government we are required to pay it to. We always pay all the taxes we owe wherever we operate and there has never been a special deal.<\/p>\n<\/blockquote>\n

I think first part is misleading because if Apple had been paying a different government it would have been paying more in taxes. That was the entire reason behind setting up the tax shelter. However, as I’ve written<\/a> before<\/a>, I think it is<\/em> accurate to say that Apple didn’t get a special deal. Other companies could have done the same thing, if they had the resources and motivation to set up such a tax avoidance scheme.<\/p>\n\n

The Irish government has argued that Apple should not have to repay the back taxes, deeming that its loss was worth it to make the country an attractive home for large companies.<\/p>

[…]<\/p>

Although corporation tax rates for businesses are set nationally, and are not subject to the EU’s jurisdiction, the trade bloc does have extensive powers to regulate state aid and in this case, it argued that by applying very low tax rates to Apple, Ireland was granting it an unfair subsidy.<\/p><\/blockquote>\n\n

Steve Troughton-Smith<\/a>:<\/p>\n

Ireland ‘didn’t want the money’ because the government thought it might risk future Apple investment in the country (Apple was, at the time, planning a huge new datacenter here. Apple later scrapped those plans because protests lead to delays)<\/p>

The Irish taxpayers sure as hell want the money.<\/p><\/blockquote>\n\n

Rui Carmo<\/a>:<\/p>\n

\n

Yes, it’s a bucketload of money. No, it’s not to be “paid”, its been in escrow all this time. And yes, it accumulated due to Ireland’s very deliberate setup as a tax haven for tech companies, which brought them a lot<\/em> of investment that would otherwise not have been done in the EU.<\/p>\n<\/blockquote>\n\n

Old Unix Geek<\/a>:<\/p>\n

\n

Ireland is actually harming the rest of the EU with its actions, since requiring Apple to pay similar taxes to everyone else might have helped EU competitors to the large US tech firms survive.<\/p>\n<\/blockquote>\n\n

And it disadvantaged other European countries, which is why the EU said that it went against Ireland’s agreement in joining the Common Market.<\/p>\n\n

Previously:<\/p>\n