Corporate Welfare and the EU

[Kerry]

I am not a fan of the EU but I would love for this law to exist in the US. Could you imagine if all corporations had to live by the same tax laws and local communities weren't held hostage or forced to pay bribes over "jobs".

http://www.dailymail.co.uk/news/article-3764393/Apple-faces-bill-billions-Irish-tax-affairs-EU-rules-company-effectively-received-state-aid.html

[Adam White]

The only real reason for those regulations is to ensure that no one EU country has a competitive advantage over the others. A look at the recent issues in the UK with Amazon, Apple, Starbucks and Google will show that these companies are very adept not paying tax - like at all.

[Kerry]

That is what would make it so great here.  Cities and states could pour money into human-based quality of life projects instead of corporate bribes.  Imagine if the $18,000,000 for Amazon had been spent on under-funded and non-funded projects around the City.

[Adam White]

That is what would make it so great here.  Cities and states could pour money into human-based quality of life projects instead of corporate bribes.  Imagine if the $18,000,000 for Amazon had been spent on under-funded and non-funded projects around the City.

It would be wonderful - but someone is going to end up paying that, right?

The other issue, of course, is that these multinationals don't pay any tax. Closing those loopholes is or should be the main priority, IMO.

[fsquid]

A bit weird to see the EU go after a company that was doing something legal in Ireland (the law/strategy ended in 2015, but companies don't have to comply until 2020 if already doing it).   I'd imagine McDonalds, Amazon, IBM, etc. will get their bills in the future.

[Gunnar]

EU rules state that each member country is free to define its own tax laws but that in turn these taxes apply to everyone.
What member states are not allowed to do is make exceptions for some companies.

So if the corner record shop has to pay 12,5% in taxes - an already very low tax rate I might add - so should Apple Ireland (the two companies in question are Irish companies owned by Apple, btw). Effectively, they paid 0.005 percent.

What Apple did via their subsidiaries was effectively transferring income from Apple subsidiaries in many other countries to Ireland. There, they had an agreement with the government that the earnings were actually made by a "head office" outside of Ireland, so should not be taxed there. Problem is: That "head office" did not really exist.

Note that the amount Apple's Irish subsidiaries are to pay are not fines - just back taxes + interest and that they will go to the Irish government.

Also of interest: The EU's investigation was triggered by details uncovered by a US Senate public hearing on Apple.

More details here:

http://www.cnbc.com/2016/08/30/how-apples-irish-subsidiaries-paid-a-0005-percent-tax-rate-in-2014.html

[Gunnar]

A bit weird to see the EU go after a company that was doing something legal in Ireland (the law/strategy ended in 2015, but companies don't have to comply until 2020 if already doing it).   I'd imagine McDonalds, Amazon, IBM, etc. will get their bills in the future.

They probably will and amounts will differ, but it's not like the EU only goes after non European multinationals: EDF ("Electricité de France") , which is  87% state owned was ordered to repay  1.5 Billion in taxes due to what the EU considers unlawful state aid.

http://www.bloomberg.com/news/articles/2015-07-22/edf-ordered-by-eu-to-repay-1-5-billion-tax-subsidy-to-france

[fsquid]

A bit weird to see the EU go after a company that was doing something legal in Ireland (the law/strategy ended in 2015, but companies don't have to comply until 2020 if already doing it).   I'd imagine McDonalds, Amazon, IBM, etc. will get their bills in the future.

They probably will and amounts will differ, but it's not like the EU only goes after non European multinationals: EDF ("Electricité de France") , which is  87% state owned was ordered to repay  1.5 Billion in taxes due to what the EU considers unlawful state aid.

http://www.bloomberg.com/news/articles/2015-07-22/edf-ordered-by-eu-to-repay-1-5-billion-tax-subsidy-to-france

not saying they don't.  I think the EU's beef should be with Ireland and not with individual companies.

[Kerry]

That is what would make it so great here.  Cities and states could pour money into human-based quality of life projects instead of corporate bribes.  Imagine if the $18,000,000 for Amazon had been spent on under-funded and non-funded projects around the City.

It would be wonderful - but someone is going to end up paying that, right?

The other issue, of course, is that these multinationals don't pay any tax. Closing those loopholes is or should be the main priority, IMO.

That is just it though - if it was illegal for other tax districts to do it then no one would be able to and Amazon would have to base their decisions on their operations and not on tax favorability status.  Since they want access to Jacksonville customers they would still have to located in Jacksonville.

[Adam White]

That is what would make it so great here.  Cities and states could pour money into human-based quality of life projects instead of corporate bribes.  Imagine if the $18,000,000 for Amazon had been spent on under-funded and non-funded projects around the City.

It would be wonderful - but someone is going to end up paying that, right?

The other issue, of course, is that these multinationals don't pay any tax. Closing those loopholes is or should be the main priority, IMO.

That is just it though - if it was illegal for other tax districts to do it then no one would be able to and Amazon would have to base their decisions on their operations and not on tax favorability status.  Since they want access to Jacksonville customers they would still have to located in Jacksonville.

Not necessarily. For example, Apple only paid £11.8 million in corporation tax in the UK in 2014 - despite making over £2 billion. This had nothing to do with the arrangement in Ireland. Because they use creative accounting to cheat - or avoid, if you prefer. It's the way the capitalists work.

[Gunnar]

A bit weird to see the EU go after a company that was doing something legal in Ireland (the law/strategy ended in 2015, but companies don't have to comply until 2020 if already doing it).   I'd imagine McDonalds, Amazon, IBM, etc. will get their bills in the future.

They probably will and amounts will differ, but it's not like the EU only goes after non European multinationals: EDF ("Electricité de France") , which is  87% state owned was ordered to repay  1.5 Billion in taxes due to what the EU considers unlawful state aid.

http://www.bloomberg.com/news/articles/2015-07-22/edf-ordered-by-eu-to-repay-1-5-billion-tax-subsidy-to-france

not saying they don't.  I think the EU's beef should be with Ireland and not with individual companies.

I agree that their beef should also be with Ireland. What they are doing with Apple and others is making them pay back what they consider to be illegal state aid - in this case preferential tax treatment.

There's no fine, no humiliating hearings, no extortion or threat of criminal charges...

[Adam White]

A bit weird to see the EU go after a company that was doing something legal in Ireland (the law/strategy ended in 2015, but companies don't have to comply until 2020 if already doing it).   I'd imagine McDonalds, Amazon, IBM, etc. will get their bills in the future.

They probably will and amounts will differ, but it's not like the EU only goes after non European multinationals: EDF ("Electricité de France") , which is  87% state owned was ordered to repay  1.5 Billion in taxes due to what the EU considers unlawful state aid.

http://www.bloomberg.com/news/articles/2015-07-22/edf-ordered-by-eu-to-repay-1-5-billion-tax-subsidy-to-france

not saying they don't.  I think the EU's beef should be with Ireland and not with individual companies.

Their beef IS with Ireland - that's why Ireland have to figure out what's owed and claw it back.

[Kerry]

That is what would make it so great here.  Cities and states could pour money into human-based quality of life projects instead of corporate bribes.  Imagine if the $18,000,000 for Amazon had been spent on under-funded and non-funded projects around the City.

It would be wonderful - but someone is going to end up paying that, right?

The other issue, of course, is that these multinationals don't pay any tax. Closing those loopholes is or should be the main priority, IMO.

That is just it though - if it was illegal for other tax districts to do it then no one would be able to and Amazon would have to base their decisions on their operations and not on tax favorability status.  Since they want access to Jacksonville customers they would still have to located in Jacksonville.

Not necessarily. For example, Apple only paid £11.8 million in corporation tax in the UK in 2014 - despite making over £2 billion. This had nothing to do with the arrangement in Ireland. Because they use creative accounting to cheat - or avoid, if you prefer. It's the way the capitalists work.

It is the way Globalist work.  Capitalism has nothing to do with it.  Blame the players that cheat, not the game.

[Adam White]

That is what would make it so great here.  Cities and states could pour money into human-based quality of life projects instead of corporate bribes.  Imagine if the $18,000,000 for Amazon had been spent on under-funded and non-funded projects around the City.

It would be wonderful - but someone is going to end up paying that, right?

The other issue, of course, is that these multinationals don't pay any tax. Closing those loopholes is or should be the main priority, IMO.

That is just it though - if it was illegal for other tax districts to do it then no one would be able to and Amazon would have to base their decisions on their operations and not on tax favorability status.  Since they want access to Jacksonville customers they would still have to located in Jacksonville.

Not necessarily. For example, Apple only paid £11.8 million in corporation tax in the UK in 2014 - despite making over £2 billion. This had nothing to do with the arrangement in Ireland. Because they use creative accounting to cheat - or avoid, if you prefer. It's the way the capitalists work.

It is the way Globalist work.  Capitalism has nothing to do with it.  Blame the players that cheat, not the game.

No, it's capitalism. It couldn't happen in a socialist society.

It isn't globalism, per se, it's global capitalism - but it can happen in one country, too. It's why socialists don't believe that capitalism can be reformed:

http://www.worldsocialism.org/spgb/revolution-or-reform

http://www.worldsocialism.org/spgb/education/introductory-articles/problems-reformism

[Kerry]

It is Corporatism run by Globalist.  The sooner everyone realizes this they sooner we can get back on track.

Maybe this will get some people on board - Corporatism was created by the Catholic Church.
http://www.sjsu.edu/faculty/watkins/corporatism.htm