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Why did the EU order Apple to pay $14.5 billion in taxes?

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stalinx20
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Friday, September 02, 2016 0:54 PM (permalink)

Earlier this week, the European Commission ordered Apple to pay an additional $14.5 billion in back taxes (13 billion Euros). The order, which both Apple and Ireland are contesting, is due to a finding that Ireland granted undue benefits to Apple, essentially treating the company as a preferred client rather than a neutral business.
According to the EC, Apple engaged in a bit of financial skullduggery. Instead of recording the profits generated by its EU businesses directly to those business segments (Apple Sales International and Apple Operations Europe), Apple attributed them to a “head office” that existed only on paper and did nothing to generate the revenues assigned to it. As a result of this arrangement, Apple’s tax declined from the criminally high rate of 1% in 2003 down to 0.005% in 2014 based on the profits of Apple Sales International.

It’s an arrangement that brings to mind the worst of Hollywood accounting. Hollywood accounting refers to the vast number of ways Hollywood can take a huge hit movie yet claim it made no money. According to New Line Studios, The Lord of the Rings trilogy, which collectively earned more than $2.9 billion dollars, actually suffered “horrendous losses.”

http://www.extremetech.com/computing/234810-why-did-the-eu-order-apple-to-pay-14-5-billion-in-taxes

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19 Replies Related Threads

    Brad_Hawthorne
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Friday, September 02, 2016 2:07 AM (permalink)
    Fallout from Brexit. EU is trying to hurt companies and governments involved.
    #2
    Afterburner
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Friday, September 02, 2016 2:18 AM (permalink)
    This....... Is awesome!

     
    #3
    bcavnaugh
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Friday, September 02, 2016 2:26 AM (permalink)
    EU has Failed in by book and need to be broken up.

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    #4
    pcmaster00
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 0:24 PM (permalink)
    When you have autocrats running a country (or block of sovereign countries in this case) who have been in political power for too long, the people need to rise up and remove those autocrats.  It started with Brexit, it will happen in America when HRC loses to DT, then the rest of the dominoes will fall in Europe and the EU will be torn apart and the 4th reich (the EU controlled by Germany), will fall.
     
    People are tired of being told what to think.  We have been given free will by our creator and that free will is not meant to be manipulated by an over-powerful central government or authority.

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    #5
    XrayMan
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 0:35 PM (permalink)
     
    They all need to make an exit.

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    Nereus
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 4:44 AM (permalink)
     
    It's not the EU wanting to tax Apple, it's the EU telling Ireland to tax Apple. Ireland told EU no, lol.
     


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    bcavnaugh
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 6:03 PM (permalink)
    Nereus
     
    It's not the EU wanting to tax Apple, it's the EU telling Ireland to tax Apple. Ireland told EU no, lol.
     


    One more reason for the EU to break up then.

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    #8
    rjohnson11
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 7:03 PM (permalink)
    bcavnaugh
    Nereus
     
    It's not the EU wanting to tax Apple, it's the EU telling Ireland to tax Apple. Ireland told EU no, lol.
     


    One more reason for the EU to break up then.


    Both Ireland and Apple will appeal. Ireland will plead their case and tell the courts that any company would have been offered the same conditions if they asked.

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    ty_ger07
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 7:38 PM (permalink)
    "The courts"? Forgive me because I don't understand European politics, but Ireland is a country. Doesn't Ireland have its own courts and if "Ireland" decides to do something, isn't Ireland naturally in agreement with Ireland? Who does Ireland have to be held accountable to if not itself?

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    Brad_Hawthorne
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 8:02 PM (permalink)
    ty_ger07
    "The courts"? Forgive me because I don't understand European politics, but Ireland is a country. Doesn't Ireland have its own courts and if "Ireland" decides to do something, isn't Ireland naturally in agreement with Ireland? Who does Ireland have to be held accountable to if not itself?

    The EU screws with country sovereignty. 
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    Brad_Hawthorne
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Tuesday, September 06, 2016 8:05 PM (permalink)
    Ireland and Apple should just stall the issue till Brexit runs it course and then tell the EU that they have no jurisdiction in the matter. The EU is trying to make a money grab while they still can.
    #12
    rjohnson11
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Wednesday, September 07, 2016 7:24 AM (permalink)
    Brad_Hawthorne
    Ireland and Apple should just stall the issue till Brexit runs it course and then tell the EU that they have no jurisdiction in the matter. The EU is trying to make a money grab while they still can.


    Sorry Brad but Ireland is not part of Brexit. You're thinking of Northern Ireland which isn't the case here. 

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    pcmaster00
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Wednesday, September 07, 2016 1:57 PM (permalink)
    rjohnson11
    Brad_Hawthorne
    Ireland and Apple should just stall the issue till Brexit runs it course and then tell the EU that they have no jurisdiction in the matter. The EU is trying to make a money grab while they still can.


    Sorry Brad but Ireland is not part of Brexit. You're thinking of Northern Ireland which isn't the case here. 

    It would still be a good stall tactic to watch the process of the EU being taken down a peg and then The Republic of Ireland can kick the EU while they are down. Only problem is that the Republic of Ireland likes the EU.

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    Cool GTX
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Wednesday, September 07, 2016 2:08 PM (permalink)
    ty_ger07
    "The courts"? Forgive me because I don't understand European politics, but Ireland is a country. Doesn't Ireland have its own courts and if "Ireland" decides to do something, isn't Ireland naturally in agreement with Ireland? Who does Ireland have to be held accountable to if not itself?

    EU, there are treaties to follow. 
     
    One of those thing a country gives up when joining the EU; its about shared costs, shared wealth and rules.

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    lenfish
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Wednesday, September 07, 2016 10:53 PM (permalink)
    Why is Apple being ordered to pay? Because the favourable tax deal with Ireland is seen as state aid which is not allowed under EU rules to ensure a level playing field between member states.
    #16
    Cool GTX
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Thursday, September 08, 2016 0:43 PM (permalink)
    lenfish
    Why is Apple being ordered to pay? Because the favourable tax deal with Ireland is seen as state aid which is not allowed under EU rules to ensure a level playing field between member states.


    Clear and concise, well said lenfish
     
    +1

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    Nereus
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Thursday, September 08, 2016 2:18 AM (permalink)
     
    Watch Ireland leave EU next, lol...
     
     


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    rjohnson11
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Thursday, September 08, 2016 5:46 AM (permalink)
    Nereus
     
    Watch Ireland leave EU next, lol...
     
     


    I doubt it. The EU financially bailed them out a few years ago when they were in trouble. 

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    pcmaster00
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    Re: Why did the EU order Apple to pay $14.5 billion in taxes? Friday, September 09, 2016 2:04 PM (permalink)
    rjohnson11
    Nereus
     
    Watch Ireland leave EU next, lol...
     
     


    I doubt it. The EU financially bailed them out a few years ago when they were in trouble. 


    I doubt it as well, but how would you shorten "Ireland Exit"?
    Irexit?
    Lol

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