And Google, and Microsoft, and Adobe, and Facebook, and Oracle, and Pfizer, and Starbucks, and General Electric.
But Apple makes the headline. Normally this would be headline whoring by the predictable media, except that this is the BBC, and I thought Starbucks was made the whipping boy for tax evasion in the UK.
I _think_ the difference is google and microsoft are using a different loophole (double irish), which by the way wouldn't be closed by this change.
EDIT: to clarify: apple is playing with one subsidiary being resident "nowhere", whereas other companies have subsidiaries being resident in tax havens. The reform will forbid the former, not the latter.
More accurately: "Ireland will not close Apple's tax loophole; won't close the other one either.", since the article explains that all Apple needs to do is to declare it's Irish subsidiary to have a tax domicile of Bermuda (or anywhere else without corporate income tax) and Apple's current loophole remains intact.
I think that is unfair. Ireland chose to have a low corporate tax rate, a decision that can be motivated by many considerations. While this does create a loophole where companies try to pay corporate tax in Ireland on profits that, without careful accounting, would usually be taxable in other countries, this does not mean Ireland is in the wrong. If he is speaking in good faith, then Ireland should want to keep its low corporate tax rate, but fix the accounting rules that allow profits to be shifted from one country to another so easily. These rules are not necessarily within Ireland's control (I'm not an expert in international taxation, though I find it fascinating).
$4.9 billion of sales occur in the UK, which is 10% of global revenue. However, only $29 million of corporation tax is payable to the UK - that's 0.3% - because Google lies and says that UK sales are actually Irish sales.
This deception occurs because basically 99.9% of the work is done in the UK, but the final signature on the sales contract is made in Ireland. This is from a Google whistleblower who was featured in the UK press.
Of course, the Irish subsidiary doesn't pay low corporate taxes on all this revenue, because it happens to have HUGE expenses in the form of intellectual property royalty payments, which need to be made to Google Bermuda (or whatever other tax haven they are using to hold the IP).
So really, Ireland is getting shafted too, just like the UK.
Well according to a dutch documentary I recently saw, Apple invented what was nick-named a 'double irish with a dutch sandwich' method of avoiding taxes by funneling profits through several different countries for their different tax laws.
Microsoft and Google and a ton of other huge corporations quickly followed suit so certainly they are just as much to blame, but I guess this loop-hole is attributed to Apple as they 'invented' it (but forgot to patent it, what gives!?).
As to the 'closing' of this loophole, allow me to chuckle. The insane amount of money these corporations can avoid in taxes due to these loopholes means that they will remain in one form or another.
Corporations are controlling governments these days, might aswell accept that the dystopian corporate controlled future of William Gibson is pretty much upon us.
And closing this/any loophole would also lower Ireland's attractiveness as a European HQ for global companies, which could do more harm than good to Ireland's economy...
Apple is categorically the largest employer out of everyone on your list. They employ over 4,000 in Ireland alone and should this particular tax loophole impact that number, it would have a monumentally devastating long-term effect.
Trends like this come and go. 20 years ago, we would have seen growing anti-Microsoft posts, and 10 years ago we would be seeing positive news from Apple almost every day. Companies fall in and out of favor, and the trend will always reflect that.
Let's see if Apple or others cut back on supply to Ireland of products - because they can make more supplying more to other areas they don't have to support the local economies of..
Yeah, I always notice that too and have long been tired of it. But ya know... Apple is roughly the biggest corporation in the world now. It kind of makes sense that they would be the focal point. Except that the "predictable media" as you put it have been doing this since long before Apple was so huge.
Unfortunately that's pretty much the BBC's own definition of impartiality — as was articulated by its head of news a few years ago — and it's deeply flawed.
It means that issues or actors are given favourable coverage in proportion to their ability to muster or manufacture complaints. In important cases (e.g. around Israel/Palestine), this is not strongly related to the merits of the arguments.
This is not the only definition, but it does help. If they get complaints that they are giving the Conservatives too much and too little airtime then it's a good indication that they're dealing with them reasonably.
> It means that issues or actors are given favourable coverage in proportion to their ability to muster or manufacture complaints.
Only if they use this to alter their output. It's more of a contrast to the other situation where you get lots of complaints on one side and none on the other, which suggests (but doesn't mean) you're treating things badly.
If they responded to just the complaints (rather than trying to think about how likely people are to complain/praise each side) then they'd never allow a gay kiss on screen (the responses are phenomenal when something like that happens).
Don't ask me exactly how, but Apple (and others i guess) manages to get paid by Spanish taxing organism by declaring negative results. They do redirect the benefits and payment of taxes to Ireland, where i guess that happens again. Spain pays Apple in concept of fiscal help, they might need some, right?
Apple made profits outside of the US and is keeping that money outside the US. They are also in full compliance with tax laws. They have no obligation to pay more in taxes than the law requires.
The article here explains how according to tax authorities, a Apple's Irish registered subsidiaries avoided Irish tax by being based nowhere for tax purposes (earlier in the year they had the cheek to issue a corporate communication stating they didn't use tax havens...). Legal or not, if you think that's anything other than a perversion of the truth I have a bridge to sell you.
The apologism here smacks of someone that didn't read the article.
WTF? This isn't about the U.S. at all. It's about making money in the UK, Germany, etc. and yet, somehow, most of that money making it to B.V.I. with minimal (<1%) tax burden.
I noticed something interesting the other day on my bank statement as I pay for a LinkedIn premium account and it says, "LinkedIn Ireland" or something along those lines. LinkedIn uses Ireland to dodgily get out of paying tax too. Every major company does, its been a known loophole for a long time now.
Google bills most non US clients from Google Ireland too. Obviously there are tax considerations. But Google (non US) and Linkedin genuinely have big presences in Ireland. They do account management, customer service, accounting, etc out of massive Dublin offices. Language, availability of educated generalists and willingness of European employees to immigrate to Dublin are also big considerations. They aren't billing to shell companies.
This is a genuine loophole that is being closed, not an intentional piece of policy.
The only efficient way to combat such tax loopholes is to abuse them. I'm not claiming that Apple or any other of these behemoths is doing it for that purpose of course, but smaller companies should do the same until it hurts governments enough to get them to act. They don't care about a few huge companies avoiding taxes as long as all small companies are paying theirs.
It says that the Dutch Railways company (Nederlandse spoorwegen) uses that scheme, which is interesting, because that company is state-owned. You wouldn't say that that company is interested in tax evasion. Crazy world that we live in.
As a non-accountant, what's the permanent solution to these types of race-to-the-bottom tax-shelter problems? I mean, other than all countries everywhere agreeing on taxes?
Increased sales tax paid where the consumer is located?
The real loophole is in U.S. law, which allows Apple to make large profits selling things in the U.S. but not pay any tax on them through the magic of self-dealing transactions.
It's as if you gave all your income to your cat - whose bank account you happen to control - and then were able to deduct those gifts fully from your tax return, leaving you with no income and no tax liability. The tax man wouldn't look kindly on individuals doing that, but does look kindly on large corporations doing that. Odd.
Are you sure? This is repeated often and immediately refuted every time. Apple pays all its tax obligations in the US, which means paying taxes on sales in the US. The dealings in Ireland are foreign tax related to foreign sales, where the US is not owed anything.
I would say having the big tech giants in Ireland has virtually no impact whatsoever on the Irish tech scene. There doesn't seem to be any movement of staff from tech giants to startups for example, or any investments by tech giants in Irish startups. Israel is way more successful at the latter, also at achieving acquisitions by major US tech companies.
Disclaimer: I live in Ireland, and have worked in a startup and interned in Apple.
There's almost no interaction between the big tech multi-nationals and local tech scene. This is mostly because the large "tech" companies mostly employ finance, sales, support and logistical staff in Ireland rather than the raw technical talent of the "startup" scene
Probably not. As noted in the article, it just requires them to proxy to a company in a tax haven (Bermuda etc) instead of to a company with no domicile. Ireland is still required as part of the loop.
And Google, and Microsoft, and Adobe, and Facebook, and Oracle, and Pfizer, and Starbucks, and General Electric.
But Apple makes the headline. Normally this would be headline whoring by the predictable media, except that this is the BBC, and I thought Starbucks was made the whipping boy for tax evasion in the UK.