Apple’s tax avoidance scheme remains as creative as their new iPhone

apple-logo_

This article was written by one of our passionate readers, Mrs Rachel Everly. The opinions expressed within reflect only the writer’s views and not The European Sting’s position on the issue.

The annual report released by Apple is hinting very strongly that they are continuing to earn good profits, which are unfortunately being funneled offshore to avoid U.S. taxes on a scale unmatched by any other company. Second, even after the EU declaring openly that Apple has been using its Irish subsidiary for illegal tax avoidance, Apple has not admitted to any wrongdoing.

Besides its disputed USD 29 billion in offshore cash, Apple has amassed up to USD 216 billion in funds on which it has hardly paid a 4% tax rate. This means that it has evaded up to USD 67 billion in U.S. taxes. The company is fighting tooth and nail in order to avoid paying any taxes to any government on its so-called Irish taxes.

However, the European Union has caught on to Apple and they are not going to let them go easy. Government authorities around the world are cracking down on big businesses for the taxes they have so successfully avoided paying. Right now European Union is hounding Apple for taxes into the amount of USD 14.5 billion. The European Union conducted an investigation into the Apple’s affairs and found that they had entered into agreements with the Ireland government through which they had received these illegal tax benefits.

What is the Apple Ireland tax controversy?

Apple in Ireland has tax arrangements in Ireland which have allowed them to pay an ultra-low tax rate of 4%. It was rightly commented that in percentage terms most small businesses like hot-dog vendors end up paying more. This is an issue that is being hotly debated in U.S for most of the profits that Apple earns are said to be earned by their Irish subsidiaries thus helping them evade tax in the U.S. The European Commission is now targeting this arrangement because they say Apple has distorted the competition and gain an unfair edge. They have alleged that such an act amounts to illegal state aid and is a breach of the EU’s unique restrictions on state support to companies.

What is the U.S’s stance of the case?

If Apple is forced to pay back money to the Ireland government that means tax money lost for the U.S. government. The U.S. government is already underfire for letting big corporations get away with what people are calling “day-light” robbery looking at the dismal tax percentages they pay compared to their profits.

Why would the U.S get less tax? Because they will treat this Irish tax as an expense which lowers their profit thus making even less available to be taxed in the U.S. Thus the U.S. is actually taking Apple’s side and has gone to say that the European commission is behaving like “supranational tax authority” and have threatened international tax reform agreements through inquiries. However, this mindset is very detrimental to progress because the EC has gone out its way to point out that a part of the USD 14.5 billion would be awarded to the United States rather than Ireland. The EC is not viewing this as political exercise rather it is going after Apple to set a precedent that all abuse of power by big corporations will eventually be brought under the limelight.

Why should the average “Joe” care?

This is something that should of huge interest to every person. Most individuals end up footing the bill for such corporations by paying higher percentages of tax. Secondly, many students will be entering the workforce and they should be aware of such issues for it will help them decide what route to take after graduation.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Join the Hive!

Featured Stings

The fatal consequences of troika’s blind austerity policy

Europe united in not supporting a US attack on Syria

The European Sting @ European Business Summit 2014 – the preview

EU unfolds strategy on the Egypt question

Yesterday’s “jokes” and sarcasm by Digital Single Market’s Vice President Ansip on EU member states’ right to protect their telco markets

The consequences of Brexit seen by a European young entrepreneur

The European Youth raises their voices this week in Brussels at Yo!Fest 2015

European Commissioner for Youth wants young people to be at heart of policy making

The European Commission to stop Buffering

2014 will bring more European Union for the big guys and less for the weak

Stability in Europe has no chances because of Ukraine

“No labels for entrepreneurs!”, a young business leader from Italy cries out

The European Parliament wants to stay in one place

The ECB still protects the banks at the expense of the EU taxpayers

Starbucks and FIAT again under Commission’s microscope: is Europe ready to kick multinationals out of the house?

Eurozone’s north-south growth gap to become structural

Commission presents far-reaching anti-tax evasion measures

TTIP is not dead as of yet, the 15th round of negotiations in New York shouts

WEF Davos 2016 LIVE: “Chinese economy has great potential, resilience and ample space for policy adjustment”, China’s Vice President Li Yuanchao reassures from Davos

Iceland won’t talk with Brussels about EU accession

“If the job market doesn’t exist, then even the most brilliant Youth Guarantee cannot ensure a job to these young people”, European Youth Forum Secretary General Giuseppe Porcaro on another Sting Exclusive

China in my eyes

Intel, Almunia and 1 billion euros for unfair potatoes

Is Erdogan ready to tear down the bridges with Europe and the West?

EU to lead one more fight against climate change at G7 summit

Eurozone needs more than some decimals of growth

WHO and IFMSA as transcendent pillars for world improvement

Greece to stay in the euro area but the cost to its people remains elusive

Lithuania needs to get rid of the victim mentality

Brexit mission impossible: Theresa May was so desperate that had to appoint Boris Johnson as Foreign Secretary

The completion of the European Banking Union attracts billions of new capital for Eurozone banks

Vulnerable young people must not be blamed & stigmatised for violent radicalisation

EU budget agreement rejected by the European Parliament

Crowdfunding: what it is and what it may become

Does EURES really exist?

MWC 2016 LIVE: Gamelab founder talks Apple TV, VR and monetisation

The EU Spring Summit set to challenge austerity

Exchanges of medical students and the true understanding of global health issues

Galileo and EGNOS programmes back in orbit powered with €70 billion

European Business Summit 2014: The role of youth entrepreneurship education in EU’s Strategy for Competitiveness

Summer pause gives time to rethink Eurozone’s problems

WEF Davos 2016 LIVE: “If we do not do properly the Paris agreement, then all 16 remaining goals will be undermined”, UN Secretary General Ban Ki-moon cautions from Davos

A Sting Exclusive: “eHealth can change many dimensions of how the healthcare area functions”, Polish MEP Michal Boni underscores from Brussels

EU Council: Private web data to be protected by…abusers

Who really cares about the 26.2 million of EU jobless?

Contact the Sting

Spanish and Polish voters are crying out for an imminent European change while US urge now Germany to change route

A Sting Exclusive: “There can be no global deal on emissions without China and the USA”, Conservative MEP Ian Duncan stresses from Brussels

230 Junior Entrepreneurs and over 70 guests attended the International Congress on “Entrepreneurial Skills for Youth”

Youth Forum welcomes European Commission proposal to speed up financing for youth employment

The EU checks the multinationals for tax fraud but Britain may sail out of the EU via Panama

Can China deal with climate change without the U.S.?

Russia to cut gas supplies again: can the EU get back to growth without a solid energy market?

2nd Global Consultation on Migrant Health 21-23 February 2017 in Sri Lanka

The Franco-German axis considers that all EU needs now is more armaments

TTIP’s 11th round starts in Miami but EU-US businesses see no sunny side

Is Eurozone heading for disinflation?

Easier Schengen Visas for non-EU holiday makers: A crucial issue for south Eurozone countries

No way out for Eurozone’s stagnating economy

Entrepreneurial leadership: what does it take to become a leader?

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s