Linked by Thom Holwerda on Thu 1st Sep 2016 22:42 UTC
Apple

Matt Gardner, the director of the Institute on Taxation and Economic Policy, took a look at Tim Cook's terrible letter to EU consumers regarding Apple's tax evasion, and pretty much tears it to shreds.

Apple created a complicated web of subsidiaries to avoid taxes, and the Irish government allowed it. Both the company and the country were complicit in this agreement. The idea that Ireland gave Apple guidance on "how to comply correctly with Irish tax law" makes both parties sound less guilty than they are. A better characterization would be that Apple cooked up a tax-dodging scheme, and Ireland allowed it.

Further along, Gardner actually opens up a major can of worms, arguing that either Apple provided false figures in its annual report, or Tim Cook is lying in his letter to EU consumers:

It doesn't appear to be even remotely truthful based on the numbers they publish in their annual reports. Each year they report that the majority of their profits are earned outside the U.S., with roughly a third (on average, over the past five years) coming from the U.S. When you look at the 10K, the annual report for 2015, you see the company reports earnings of $72 billion worldwide, and just one third of those profits are attributed to the U.S. And yet Cook's statement says that the vast majority of their income is taxed in the U.S.

We think that is a very low estimate. It certainly appears that the company is shifting profits out of the U.S. and into tax havens overseas. So one of these things must not be true: Either the numbers presented to shareholders in their annual report are false, or Tim Cook's new statement that the majority of its profits are taxed in the U.S is false. They both can't be true.

That's a bold claim to make, but it's hard, if not impossible, to argue with Gardner on this one. Since it's incredibly unlikely Apple is falsifying its annual reports, the most logical conclusion is that Tim Cook is lying in the open letter.

Tim - if you find yourself in a hole, stop digging.

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RE[2]: Pretty good lies
by dsmogor on Fri 2nd Sep 2016 19:10 UTC in reply to "RE: Pretty good lies"
dsmogor
Member since:
2005-09-01

No, it's Apple that should blame Irish and their own advisers for looking too narrowly (at the Irish tax deal and not the EU context).
They were probably ensured that EC would never trigger the state aid bill as they didn't in case of German shipping industry (e.g. http://europa.eu/rapid/press-release_IP-16-1643_en.htm).
They forgot EC only makes exceptions for struggling industries that would cause huge uproar in core countries if collapsed...
and they've probably bet on wrong lobbysts

Reply Parent Score: 3

RE[3]: Pretty good lies
by JAlexoid on Sun 4th Sep 2016 05:22 in reply to "RE[2]: Pretty good lies"
JAlexoid Member since:
2009-05-19

Thing is, the exceptions to spacial treatment, has to be based on a economic benefits. Treaty of Lisbon(consolidated version) Title VII Chapter I Section II covers a lot of cases of state aid.

It's very clear that giving any aid to Apple yielded nothing. It is likely that Irish politicians knew about it.(Apple employs very only a small workforce in Ireland, not even a single Apple Store in ROI)

Google may be in the same boat, but Apple I hear negotiated a great deal.

You know that when it comes to the application of laws - the intent to circumvent the laws is very much an illegal activity and will cause you to lose your legal battle.

Reply Parent Score: 2