Should Ireland appeal the Apple ruling

cremeegg

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Successive governments are to be commended for standing by Revenue and govt policy despite pressure over the years. This can only do irelands reputation and FDI prospects heart good.

I note from the court's press release that;

NOTE: An appeal, limited to points of law only, may be brought before the Court of Justice against the decision of the General Court within two months and ten days of notification of the decision.

As the decision appears to me to be based on the facts of the case rather than any point of law an appeal would seem unlikely to succeed. That's my 5 minute free opinion, it will be interesting to see what the expensive legal opinion will be. (Of course the lawyers will want an appeal).

The most interesting outstanding issue I would like to understand is where are the corresponding profits being taxed since the laws in question were changes in 2014.
 

Gordon Gekko

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The costs are to be borne by the European Commission as per the ruling.

The monies have been taxed in the US since they reduced their rates (it was always tax deferral until then).
 

NoRegretsCoyote

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The most interesting outstanding issue I would like to understand is where are the corresponding profits being taxed since the laws in question were changes in 2014.
As I understand it Apple on-shored a lot of the IP to Ireland even before the 2016 ruling.

Ireland's corporation tax take has more than doubled since 2014. Apple can't account for all or even a majority of this, but it certainly counts for a large amount.
 

Sophrosyne

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Article by Seamus Coffey in today’s Irish Times

“Vestager grabbed the headlines with press-conference references to minuscule tax rates of 0.005 per cent and tax bills of €13 billion. But when the commission’s 130-page decision was published a few months later, it contained neither. They were provided for public consumption but were not part of the technical detail.”

Regarding yesterday’s ruling by the General Court of the European Union:-

“The key line of yesterday’s court ruling was that the commission’s state aid finding was done “without attempting to show that that income was representative of the value of the activities actually carried out by the [IRISH]branches themselves.”

From the outset, one of Ireland’s responses was that the only Apple profit that should be subject to tax in Ireland is profit that was actually generated in Ireland. The court has upheld that view.”

Regarding a possible appeal:-

“.. such was the overwhelming rejection of the commission’s case by the court that a successful appeal seems unlikely. The court left very few threads for the commission to cling on to.

Vestager issued a combative statement after the ruling was published, but it was hollow and noisy rather than making any substantive points.”
 

NoRegretsCoyote

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Regarding a possible appeal:-

“.. such was the overwhelming rejection of the commission’s case by the court that a successful appeal seems unlikely. The court left very few threads for the commission to cling on to.

Vestager issued a combative statement after the ruling was published, but it was hollow and noisy rather than making any substantive points.”
State aid is a dead end for the Commission now on corporate tax.

FT is reporting that it may use other approaches:

In a statement, the commission said: “From the beginning of this mandate, the commission has been clear that we would explore how to make full use of the provisions in the treaties that allow taxation proposals to be adopted by qualified majority rather than unanimity. The commission is now looking at various options to deliver on this political commitment.”

Article 116 of the EU treaty gives Brussels the powers to correct “distortions” in the single market, but has never been used. The instrument allows the commission to propose a directive designed to correct distorting tax schemes and sue governments at the European Court of Justice if they do not comply.

The measure is likely to target schemes in countries such as the Netherlands, Luxembourg, Belgium and Ireland, said one official. Diplomats expect the plans to be fiercely resisted by some member states, opening up the prospect of years of lengthy legal battles at the ECJ.
 

Sophrosyne

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Interesting article on EU moves to increase its taxation powers and create a more integrated, federalist Europe. This “loss of sovereignty” was one of the principal reasons for the UK’s departure from the EU.

“In the field of corporate tax, though, there is an increasing number of directives that harbour the sole objective of reducing tax competition between countries by preventing states from granting advantages to businesses.

This policy is dictated by the larger, more influential members of the EU – such as France and Germany – and imposed upon the smaller ones. Unlike France and Germany, countries such as Belgium, Luxembourg, the Netherlands and Ireland can’t offer businesses access to a wide net of customers. As a result, they have always felt the need to attract foreign companies through tax advantages. These tax advantages are lawful so long as they are not selective – that is, providing they are equally accessible to all.”

“The EU has made a significant contribution to the prosperity of its inhabitants by increasing freedoms, particularly through the creation of a single market. In doing so, it has somewhat reduced the influence states can impose on their citizens.

But this has also restricted some freedoms. When the EU moved towards becoming a political authority, it began to regulate whole areas of the economy and people’s lives. It has itself become a power that is exercised – directly or indirectly – on businesses and individuals. By granting additional capabilities to the EU, at best, one only shifts the burden from individual states to a higher level. This means that the principle of subsidiarity – according to which, decisions must be taken as close to citizens as possible – will be further eroded.”
 

roker

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Let's take a simple approach no court case no expenses,
Split the difference 50% to Ireland 50% to Apple then everyone is happy
 
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