back to article European Commission outlines appeal against Apple's €13bn tax ruling

Last year Apple won a long-fought legal battle against the European Commission, which argued it had received unlawful state aid from Ireland that allowed it to swerve nearly €13bn in back taxes. Today the European Commission published a summary of the grounds it intends to pursue in an appeal. The commission claims that the …

  1. Woodnag Silver badge

    Lawndering

    ...that's it's Ireland's DPC that has steadfastly refused to prosecute FB under GDPR for 7 years now.

    https://noyb.eu/en/irish-dpc-settles-judicial-review-and-agrees-decide-swiftly-facebooks-eu-us-transfers

    There are tax haven countries, money laundering countries, and countries that refuse to apply the law to anchor companies. Let's call it 'lawndering'.

    1. Yet Another Anonymous coward Silver badge

      Re: Lawndering

      It also has the potential to get much worse.

      The new Eu member state "Dutchy of Grand Fenwick" offers to allow drug companies to register in it's delightful capital and as well as offering only 1% corporation tax it guarantees approval for all their drugs with the hour and promises not to look too closely at the test data.

      1. John Miles
    2. Anonymous Coward
      Anonymous Coward

      EU doesn't legislate for taxes

      Only problem here is that the EU agreement doesn't cover taxes, they don't get to regulate the taxes in member states, so they had a go at turning it into a competition issue under national law instead.

      EU: "Ireland is failing to uphold competition laws by giving Apple a great tax deal, and not giving other phone makers in Ireland a great tax deal. We order it to charge Apple more tax. We can do that because we regulate competition, and in no way is it a cross state tax rule because we've phrased it as a single state competition challenge that will totally fool everyone"

      And it fooled nobody and was thrown out.

      What other phone makers?

      Why is the only remedy to charge Apple more tax? Why couldn't they give these other Irish phone makers a better tax deal?...... etc.,

      It was a straight power grab, but the EU needs to be granted power to legislate taxation to legislate taxation. Grabbing it by the back door is not on.

      1. SuccessCase

        Re: EU doesn't legislate for taxes

        Yep, agreed. What annoys me is how people become politically tribal over this stuff, when we should all be able to agree, the politicians were taking shortcuts. Instead of regulating properly, and admitting they don’t yet have have the power, and then making the hard yards by getting it agreed in a new treaty, they instead cynically try to twist existing legislation and competition law leaving the distinct impression they don’t care for their own rules and procedure and will do anything for posturing and as little possible to do it the right way whenever there is any sign “doing it the right way” equates to hard political work.

      2. LDS Silver badge

        It's about state aids, not taxes

        Still EU regulations cover state aids. This is not a tax matter - it's if Ireland unlawfully gave Apple specific aids that are not permitted by EU regulations. For the matter Ireland can charge a zero tax rate, just it has to offer it to any company based in Ireland, and can't give it to specific companies on its government whims.

        Moreover given the fact that companies has no other place to go in EU which combines Ireland advantages - I wonder what the Irish politicians are actually afraid of. My bet is in some lobbying money, not jobs in Ireland.

        EU should have asked an hard border between Ireland and Northern Ireland, though.... just to remind them patience has some limitations.

        1. seven of five Silver badge

          Re: It's about state aids, not taxes

          > EU should have asked an hard border between Ireland and Northern Ireland, though.... just to remind them patience has some limitations.

          Have you been there, thirty years ago? No, obviously not, otherwise you would known damn well why the hard border has to be avoided. Just thinking about what our parents did to each other back then makes me shudder. Granted, I do like the convenience of crossing the border whenever I like, but most of all I love my children to be able to go to school without being torn apart by a bomb.

          Just shut the fuck up.

          [1] much more deleted, I need to calm down.

      3. Yet Another Anonymous coward Silver badge

        Re: EU doesn't legislate for taxes

        >Why is the only remedy to charge Apple more tax? Why couldn't they give these other Irish phone makers a better tax deal?...... etc.,

        Because it becomes a race to the bottom for Eu countries to offer lower tax rates and lighter regulations to foreign corporations. It's a problem if you are allowed to count sales anywhere in the Eu in one country.

        It becomes really risky when it comes to things like safety - although you don't have to be a small country to be regulatory captured - as VW proved.

      4. CRConrad

        Re: EU doesn't legislate for taxes

        In that case, why should Ireland get to favourise telephone makers over other companies? Apple and many (most?) other phone makers also make computers; some of them make TVs and other consumer electronics. So Ireland would have to give all those the same rates. Some of those also make .... And so on, and on. In other words: All corporations work in the same economy, competing for the same money, so they're all connected; they all compete against each other. In the end, they'd either have to give all corps Apple's rates — or collect the same taxes from them as from everyone else.

        Kind of the same with countries: They compete against each other for, in this instance, corporate regional headquarters; using things like favourable corporate tax rates. Thing is, though, if you're in a mutual support and cooperation club — like the EU — competing against your fellow members with outrageously low rates like this is an arsehole move. Ireland and all Irish should be ashamed of themselves. And the EU obviously should regulate tax rates.

  2. Anonymous Coward
    Anonymous Coward

    "we've paid over $35 billion in corporate income taxes over the past three years, plus billions of dollars more in property tax, payroll tax, sales tax and VAT."

    Well, the workers* pay the payroll taxes, and the customers pay the VAT.

    Apple only collects them on behalf of the tax dept.

    (*some workers. Probably not Tim Cook, who probably pays s.f.a)

    1. JimJimmyJimson

      Certainly in Australia payroll tax is a tax on the employer not the employee - paid to the state government. I believe its the same in many other countrie.

      1. LDS Silver badge

        The fact that the revenues tax is paid directly by the employee or kept by the employer who pays it does not change anything - it's a tax paid by the employee on his or her pay.

        Many jurisdiction prefer the latter to avoid tax evasion, and in the belief some employees are unable to cope with the difficulties of a tax report. Still here you have to file your own tax report for anything which is not a pure salary tax, and to deduct any expense.

        Surely it means a cost for the employer for the processing, but it's fully paid with money which are not the employer's ones - they are full part of the employees' salary.

      2. codejunky Silver badge

        @JimJimmyJimson

        "Certainly in Australia payroll tax is a tax on the employer not the employee - paid to the state government."

        Thats right. Paying the money to the employee or the tax man makes little difference to the company, it is the expense of employing a person.

    2. Yet Another Anonymous coward Silver badge

      >Apple only collects them on behalf of the tax dept.

      Remember in 2008 crash when banks claim they "paid" 75% of tax in the UK. Meaning they transferred 75% of the tax between tax payers and the govt.

  3. Potemkine! Silver badge

    Those multinational companies know well how to evade taxes, that only is an unfair competitive advantage against SMEs.

    The rule should be "you pay taxes where you do business". The non-existence of that rule is the proof of the corruption of our elites.

    1. Dinanziame Silver badge

      There's good reasons for the law which allows companies to pay tax in a single place. When you are an SME, it's ruinous to have to pay taxes in multiple countries, and it forces you to refuse business because it is just not worth it to hire accountants to figure it out.

      These good reasons don't apply to multinationals that already do have offices and pay tax in all countries. You'd think that politicians would have realized that when writing the law, but apparently not. Or maybe they totally noticed, but they all hoped their country would be Ireland.

  4. codejunky Silver badge

    Again

    I hoped the EU would finally accept they were wrong and sod off on this one. Trust politicians to decide that a government offering a deal is not to blame if the deal is shoddy. Apple was only doing what it agreed with the law makers.

    1. seven of five Silver badge

      Re: Again

      I would have explained, but then I saw it is you.

      Have it your way: Yes, the EU is wrong and the root of all evil up to and including the crucifiction, probably made the dinosaurs extinct as well.

      1. codejunky Silver badge

        Re: Again

        @seven of five

        "I would have explained, but then I saw it is you."

        I do seem to have that effect on people who dont seem to have much by way of reason or thought through argument. But I appreciate the comment, normally I just get quiet downvotes

        "Have it your way: Yes, the EU is wrong and the root of all evil up to and including the crucifiction, probably made the dinosaurs extinct as well."

        Oh jeez are you one of those who thought the EU stopped the next world war or something? Sorry if this is a shock to you but the EU isnt that old.

        However if you do think you have a reasoned thought as to why Ireland offering Apple a deal is not the fault of Ireland then do tell.

        1. Missing Semicolon Silver badge

          Re: Again

          It's illegal state aid. The EU has rules against this (which were, of course, ignored for years when it was Luxembourg doing it).

          States are allowed to set corporation tax rates. But... EU states are not allowed to offer special low-tax sweetheart deals to multinationals to tempt them to set up in their territory. Ireland was originally adjudged to have done so.

          1. codejunky Silver badge

            Re: Again

            @Missing Semicolon

            "It's illegal state aid. The EU has rules against this (which were, of course, ignored for years when it was Luxembourg doing it)."

            The selective application of the rules does make a mockery of the system. But even without that I agree about the state aid, which wasnt offered by Apple but by Ireland. This is where the one to break the rules isnt the target of punishment.

            "Ireland was originally adjudged to have done so."

            Spot on I dont disagree. So why is it Apple being punished for following the agreement with the lawmaker when its the lawmaker who broke the rules. My only issue with this is how Apple must pay for Ireland's actions.

            1. Missing Semicolon Silver badge

              Re: Again

              Perhaps by the same principle that makes accepting a bribe be as illegal as offering one.

              1. codejunky Silver badge

                Re: Again

                @Missing Semicolon

                "Perhaps by the same principle that makes accepting a bribe be as illegal as offering one."

                Perhaps, except it wasnt just anyone offering what could potentially be described as a bribe but a government. The very law makers, the authority themselves, who made this offer entirely and as you mentioned Luxembourg.

                Did apple accept a bribe, or did Apple accept the proposal from the lawmaker who even now stands by the deal that was accepted? Apple might have been misled into the deal (Ireland breaking the rules) but it would be hard to blame Apple for Irelands actions.

            2. CRConrad

              You've got it bass-ackwards.

              So why is it Apple being punished for following the agreement with the lawmaker when its the lawmaker who broke the rules. My only issue with this is how Apple must pay for Ireland's actions.
              It's Ireland that is being asked to rectify its transgression (and "punished" by being shown not to be able to make such anti competitive sweetheart deals in the future). Apple is not being" punished", just asked to pay the same taxes as any other corporation (that got the "ordinary" sweetheart deal from Ireland)

              1. codejunky Silver badge

                Re: You've got it bass-ackwards.

                @CRConrad

                "It's Ireland that is being asked to rectify its transgression"

                Yes I get that. Ireland who makes the rules made an agreement with Apple. Turns out that agreement is wrong, after the fact, and Ireland of course is the one in the wrong.

                "(and "punished" by being shown not to be able to make such anti competitive sweetheart deals in the future)."

                'punished' by being told to take money from Apple it has no right to by its own agreement which is retrospectively been decided Ireland is in the wrong. Its like punishing a felon by fining the victim.

                "Apple is not being" punished""

                Having money taken from you by force is theft. Through agreement Ireland promised not to take the money. Ireland is being forced to take the money from Apple. Ireland gets money (it doesnt want to take to their credit), EU feels proud of itself, Apple loses money it wasnt going to. Who is punished from this?

                "just asked to pay the same taxes as any other corporation"

                Except it did pay the taxes agreed. And it isnt being asked, it cant exactly refuse.

                "(that got the "ordinary" sweetheart deal from Ireland)"

                From who? Who did it? Who in the wrong? Hence my point Ireland. I could understand Ireland having to pay a fine, to be watched for further breaches of the rules etc. But the victim who acted within accordance of the law as Apple. It was agreed with the men with guns, the ones in power, the law makers.

                1. Roland6 Silver badge

                  Re: You've got it bass-ackwards.

                  >But the victim who acted within accordance of the law as Apple.

                  I doubt it is as clear cut, from the evidence Apple asked for a sweetheart deal ie. for an arrangement that wasn't available through the published laws/rules, ie. Apple were complicit.

                  But yes, the EU should have demanded that Ireland pays the bill and let Ireland sort out the hole (of its own creation) in its budget and negotiate a new agreement with Apple that is in accordance with EU-IRE agreements.

        2. seven of five Silver badge

          Re: Again

          > I do seem to have that effect on people who dont seem to have much by way of reason or thought

          > through argument. But I appreciate the comment, normally I just get quiet downvotes

          Yes, everybody else being unreasonable is exactly your problem.

          1. codejunky Silver badge

            Re: Again

            @seven of five

            "Yes, everybody else being unreasonable is exactly your problem."

            Your the one who apparently had a reasoned contribution but saw it was me so backed away from airing it. Presumably because you dont want your opinion questioned or challenged. Other people seem able to reply so whats your problem?

            1. Anonymous Coward
              Anonymous Coward

              Re: Again

              *you're

            2. seven of five Silver badge

              Re: Again

              Demonstrated (here again, btw, but noticed since I started to memorize your username - Ugh, him again) ignorance. You consistently insist it is "the others" who are wrong, have a problem, are unreasonable, fail to see, etc.

              Most of the time accompanied by personal attacks:

              "Presumably because you"

              "You seem to think"

              "Are you saying"

              EOT.

              1. codejunky Silver badge

                Re: Again

                @seven of five

                "You consistently insist it is "the others" who are wrong"

                So Ireland offer Apple a deal. Apple accepts the deal. The deal is now contested as against the rules, yet its the law makers (Ireland) who offer the deal.

                I dont care if it is or isnt wrong for the deal to exist, what puzzles me is why Ireland (the authority, the law makers) somehow get away with dropping Apple in it? Not that they did, Ireland supports Apples position. This seems like a spat between Ireland and the EU.

                1. Roland6 Silver badge

                  Re: Again

                  >This seems like a spat between Ireland and the EU.

                  It is, as it is Ireland that offer Apple a deal that wasn't available to others, hence breeched EU/IRE competition law.

                  However, because of the deal, Apple have skin in the game as it permitted them to avoid paying (rightly or wrongly) €13bn in taxes to the Irish government, hence they have a powerful incentive to do whatever they can to keep the monies in their account. Unfortunately, for Apple, the Irish government don't really have any skin in the game and hence are happy to effectively step aside and let others fight it out - hence why the media can get away with portraying this as being "The EU aginst Apple" rather than more correctly "the EU enforcing IRE to honour its EU membership obligations".

                  Obviously, the UK has a vested interest in the EU winning, as it should reduce the Brexit divorce bill. :)

        3. CRConrad

          You sure make some stupid statements.

          Oh jeez are you one of those who thought the EU stopped the next world war or something? Sorry if this is a shock to you but the EU isnt that old.
          You mean the world war that might have started, but didn't, thanks to the existence of rhe EU? Yeah, there were two of those in the 1970s, three in the eighties, and fourteen since then.

          That is: You can't prove a hypothetical, doofus! The EU does and did exist, and there have been no world wars. Without the EU, there might have been -- you have no proof there wouldn't.

          1. codejunky Silver badge

            Re: You sure make some stupid statements.

            @CRConrad

            "That is: You can't prove a hypothetical, doofus! The EU does and did exist, and there have been no world wars. Without the EU, there might have been -- you have no proof there wouldn't."

            Sorry doofus but the EU didnt exist back then. For more than 40 years there was no EU and no world wars. Its people believing it did that I poked fun at (sorry). Your comments first paragraph sums up the kind of stupidity I was mocking, the EU 'formed' in 1993.

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