ECJ upholds commission decision on apple tax case

magicbastarder

I imagine there's going to be a mad tussle for the money now. Everyone will want a slice of the pie - e.g. France will claim €Xbn of that was earned in France etc.

https://www.irishtimes.com/business/2024/09/10/eus-top-court-to-rule-on-long-running-case-over-apples-irish-tax-affairs/

dasdog

Facilitating a tax rate as low as 0.005% in 2014 to the worlds biggest company is not a good look.

ancapailldorcha

I'm hoping that the days of multinational corporations dodging tax is over. It's a horrible look for Ireland to be facilitating this in the 21st century. Hopefully, both the EU and the US clamp down hard on this.

ELM327

Nah, tell them to feck off, we're putting it into our strategic investment funds, happy that we showed Apple we are pro big business and defend them to the death, yet we still get the money.

ELM327

https://www.boards.ie/discussion/comment/122599812#Comment_122599812

If they are dodging tax but setting up global businesses here, new jobs and or additonal tax income, then I'm happy to have it

Dr.Tom

That money will erect a few nice bike sheds for us.

GLaDOS

Be able to build 3 more bike sheds now

Kermit.de.frog

https://www.boards.ie/discussion/comment/122599812#Comment_122599812

Do you know how Ireland's bread is buttered or are you just happy for the country, which I believe you don't even live in, to go back to a poverty stricken hellhole because it makes you feel morally pure.

Allinall

https://www.boards.ie/discussion/comment/122599808#Comment_122599808

I think it's a great look.

Unfortunately it's tarnished now with this judgement.

Peregrinus

https://www.boards.ie/discussion/2058368368/ecb-upholds-commission-decision-on-apple-tax-case

I don't think so. The court has ruled expressly that this tax is due to Ireland. If France (or anyone else) wanted to argue that that some or all of the tax was due to them, they would have needed to intervene in the case to make that argument before the final judgment was handed down.

That's the thing about final judgments. They're final.

There will be problems resulting from this, but other governments demanding tax revenue is not one of them. The main issue is that this underlines that the Commission can put limits on what IRL can do by way of attracting inward investment through favourable tax treatment. (We can still do this — just not quite as freely as we thought we could.) And that may adversely affect our comparative advantage when it comes to atracting inward investment.

The actual decision in this case affects the particular tax structure that was used by Apple, and so far as I know that is unique — no other company uses it. So this decision, in itself, doesn't affect the tax treatment of anybody but Apple. But there may be a feeling that the Commission will now be emboldened to scrutinise and possibly challenge other, um, ingenious tax arrangements. So there might be a general loss of confidence — the shine might come off tax-based investment incentives in general.

Of course that wouldn't be something that would just affect Ireland — other member states use tax policy to attract investment. But precisely because Ireland has been so successful at attracting investment, such a development would pose a relatively greater problem for Ireland than for most other member states.

Calahonda52

https://www.boards.ie/discussion/comment/122599808#Comment_122599808

The problem with this notion is that if you look at FDI in other EU countries, the top tax rate is higher than our but after all sorts of allowances it heads close to zero

LambshankRedemption

https://www.boards.ie/discussion/comment/122599818#Comment_122599818

This is the best outcome for Ireland as a whole. We showed companies around the world we will stand up to the EU, and we get to keep the money.

I started a new job in 2010 and got sent to Germany for the 3 day onboarding. Joining at the same time was the new European CFO who was from the Cork office, and he gave a presentation about Irelands role in the company and subtly said that one of the reasons that Ireland was the European headquarters, despite actually only employing about 10 staff in Ireland was due to the attractive tax rates, and he said if that changed, then they would most likely be moving to Switzerland. Well its nearly 15 years later and they are still in the same place.

Calahonda52

Careful what you wish for here.

If FDI tax take gets eroded, the austerity in last crash will look like luxury due to the huge increase in the cost base

MrMusician18

The money should be used to pay down the national debt or invested in a sovereign wealth fund.

Today is an interesting day though, the State fought extremely hard to not keep this money because at its heart it is about tax sovereignty. If we are being honest, Irelands economic advantage is almost entirely as a result of tax policy, but if that is neutered then what have we left?

I personally think this is the beginning of the end of the EU love-in that has completely dominated official circles for the last 20 or so years.

Palmach

https://www.boards.ie/discussion/comment/122599865#Comment_122599865

It's zero in Estonia.

ELM327

https://www.boards.ie/discussion/comment/122599901#Comment_122599901

As i and others posted above, we want the money, but we have to play the "we don't want the tax" card for large FDI so they keep giving us the money!

thatsdaft

https://www.boards.ie/discussion/comment/122599908#Comment_122599908

Cyprus has fairly low rate too and Hungary is lower than here

But hey we should be ashamed apparently of having independent tax policies

Bizzare

MrMusician18

https://www.boards.ie/discussion/comment/122599974#Comment_122599974

It's about more than that. When revenue gives a tax judgement there needs to be a certain finality about it so everyone can move forward. This judgement from the ECJ means that any other company that has an agreed tax strategy could find itself liable for huge back taxes. Apple is OK, it can pay it.

Strategically, I think it was a mistake for the commission to go after Ireland here as they risk at least partially loosing a political class that they had completely captured.

The other thing this judgement shows is the complete ridiculousness of the European legal system, where a higher court has said no, the previous judgement was completely wrong. Just goes to show how much law is actually arbitrary.

ELM327

https://www.boards.ie/discussion/comment/122600012#Comment_122600012

I suspect the go after ireland here was politically motivated. (and I use the word suspect, loosely). I don't think they are going to go after John's factory down the road. This was about making a statement. To be honest though I agree with your sentiments and I'd like there to be some sort of "grandfather" rule introduced where retroactive reviews like this are not possible, only allowed for a go forward basis. If you tried to recoup funds like that from most companies they would fold.

StevenToast

Just keep appealing until you get the decision you want....sorry "lower court" you didnt get the right answer...try again...

Farce...

greyday

Can Ireland and Apple appeal this time?

magicbastarder

There's no higher court left to appeal to.

thatsdaft

https://www.boards.ie/discussion/comment/122600012#Comment_122600012

Laws being applied retroactively are also fairly terrible precedent

But then again most of the continental law is civil law based not common law based like us, which makes us potentially have the worst of both worlds which is also terrible precedent

Meanwhile EU is blocking transfer of 300bn of Russian criminal state assets to Ukraine

Fascinating to see Ireland being punished while criminal states who threaten our existence almost daily being protected

thomas 123

https://www.boards.ie/discussion/comment/122599901#Comment_122599901

An Educated English speaking populance with access to the EU is a big draw for many big companies.

Of course the tax situation is likely bigger draw, but we don’t have nothing to offer other than that.

shockframe

EU get us into this mess.

EU better get us out.

hotmail.com

Very embarrassing for Ireland. The government was attempting to maintain our tax haven status.

Peregrinus

https://www.boards.ie/discussion/comment/122600012#Comment_122600012

That's how courts of appeal work in pretty much all legal systems, MrMusician. If it can't overturn the judgment of the court below, then it's not a court of appeal. Plus, if it couldn't overturn the judgment of the court below, what would be the point of appealing to it?

greyday

https://www.boards.ie/discussion/comment/122600096#Comment_122600096

Were they not advised to fling it back to the lower court to be reconsidered but decided to go the whole hog themselves and make a binding finding?

hotmail.com

What's the legal bill for this embarrassment?

Danzy

https://www.boards.ie/discussion/comment/122599812#Comment_122599812

If the debate goes well tonight for Harris your hope is goosed

Danzy

https://www.boards.ie/discussion/comment/122600190#Comment_122600190

They used a no foal, no fee solicitor.

DellyBelly

https://www.boards.ie/discussion/comment/122599842#Comment_122599842

Brilliant….

ELM327

https://www.boards.ie/discussion/comment/122600125#Comment_122600125

Why would they do that?

LambshankRedemption

https://www.boards.ie/discussion/comment/122600080#Comment_122600080

What mess would that be?

Randycove

https://www.boards.ie/discussion/comment/122599834#Comment_122599834

which would be fine if the loop holes being created only affect tax payable in Ireland, but the MNCs are using them to avoid paying tax all over the world and, in particular, our fellow EU countries.

Nermal

The perfect opportunity to once again assert our sovereignty. Hold a referendum to explicitly subordinate EU law to Irish law and ignore the ruling.

Randycove

https://www.boards.ie/discussion/comment/122600333#Comment_122600333

and risk getting thrown out of the EU?

Marcusm

https://www.boards.ie/discussion/2058368368/ecj-upholds-commission-decision-on-apple-tax-case

there’s no basis supporting that in the decision whatsoever. It determined that the profits related to the intellectual property which should be allocated to the Irish branches rather than the thinly resourced head office - at no point has any serious suggestion been made that authority exists to reallocate it to the market jurisdictions. If there was, the implications would go far beyond Apple.

Nermal

https://www.boards.ie/discussion/comment/122600346#Comment_122600346

There's no legal mechanism for that to happen, nor is the EU incentivised to start kicking out net contributors.

magicbastarder

https://www.boards.ie/discussion/comment/122600333#Comment_122600333

you'd think asking the people in a referendum, 'let's throw mud in the eye of the EU by refusing to accept €13bn from apple' would result in the referendum passing?

beachhead

What's all fuss about here. Ireland will not be taking the money from Apple.Sure how could we.Arent Apple lovely fellas.Harris,Donaghue and Chambers will find a way to take a token amount so as not to upset our betters and as has been previously said and refuted other EU countries will be asking for their cut

MrMusician18

https://www.boards.ie/discussion/comment/122600096#Comment_122600096

I know it is and when you think about it, it's fundamentally ridiculous. What we are saying is that although educated and learned, judges at lower courts judgement cannot be trusted to come to the correct conclusions that we must have more educated and learned judges over them who we have deemed cannot err and therefore their judgement is absolute. It's actually absurd.

The contrast that with criminal judgement. Once a verdict is delivered by 12 lay jury members, that verdict is absolute and cannot be appealed unless there is some change in the facts. And that can be after another 12 have heard the same evidence and cannot determine a verdict.

_BAA_RAM_EWE

https://www.boards.ie/discussion/comment/122599808#Comment_122599808

this whole thing is nasty looked on as a whole and won't improve in my lifetime...

Giving 13 billion to a government like Ireland should be criminal the way they'll waste it.

Better spent dividing it up between Gaza/Israel/Ukraine and Russia.

fergiesfolly

Corporate taxation in the EU is a game of hide and seek. Levying higher taxes on MNCs but giving most of it back in incentives, "legal" tax breaks and magic bean grants. It's a joke.

Keep the money and spend it before Sinn Fein get in and spend 13 billion in social welfare increases in the first year.

Think of it… The Steve Jobs Luas line. The Galway Apple Ring road. The iTunes concert hall.

Randycove

https://www.boards.ie/discussion/comment/122600357#Comment_122600357

tell that to Hungary.

Maybe not expulsion, but suspension is certainly possible.

NIMAN

Maybe just take the money and use it to fix any child who is waiting on an urgent operation?

Or use it to pay for more houses?

Or use it to build/ fix a few roads?

Or use it to better some sporting facilities?

Or use it to reduce our carbon footprint?

There is loads to do with it, should we decide to spend it. Let it be used for good deeds and I'm sure the Government and Apple can rest easy.

Geuze

https://www.boards.ie/discussion/comment/122599808#Comment_122599808

We didn't.

Read these:

https://economic-incentives.blogspot.com/2014/05/corporation-tax-residence-is-ireland.html

https://economic-incentives.blogspot.com/2014/09/getting-behind-story-that-some-are.html

https://economic-incentives.blogspot.com/2016/03/apple-sales-internationalby-numbers.html

ASI is hugely profitable.

The ASI branch in Cork is a small part of ASI.

The Revenue Commissioners agreed with Apple about how to determine how much of ASI profits are attributable to the Cork branch.

• In 1991, a basis for determining Apple Computer Accessories Ltd.’s (subsequently ASI) Irish branch net profit was proposed by Apple and agreed by Irish Revenue. According to that ruling, the net profit attributable to the ASI branch would be calculated as 12.5% of all branch operating costs, excluding material for resale.
• A modified basis for determining net profit was agreed for the ASI branch in 2007 with a [8-18]% margin on branch operating costs, excluding costs not attributable to the Irish branch, such as […] and material costs.

We taxed the profits of the Irish branch, as follows:

ASI is very profitable, but not much of those profits are generated in Cork, so they should not be taxed by us.

They should be taxed in the USA, which is what eventually happened.

Peter Flynt

Devastating news for FF and FG.

thatsdaft

https://www.boards.ie/discussion/comment/122600346#Comment_122600346

Hungary (incidentally have much lower corporate rate than here) are busy taking a 💩 at every EU table out there

And still no one figured out how to kick them out, we be fine

Nermal

https://www.boards.ie/discussion/comment/122600373#Comment_122600373

Absolutely, the campaign writes itself. Are you going to vote with Romantic Ireland, or with those who fumble in a greasy till?

Randycove

https://www.boards.ie/discussion/comment/122600452#Comment_122600452

removing the primacy of the ECJ is taking a dump on the EU. It undermines one of the key principles.

And ignore the tax rate. This is about deliberate loop holes created for the MMCs to exploit. Try googling leprechaun economics, or the double Irish for more details.