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Apple Gets Hit With Back Taxes, But Where’s The Punishment For Irish Government Collusion?

apple-ireland

So the EU has given its verdict on Ireland’s tax breaks for Apple and they are damning. Effectively significant amounts of state aid given to Apple in order to bring a limited number of jobs to Ireland and in the process allow Apple to dodge its tax liabilities across the whole EMEA region.

Despite Tim Cook’s protestations it is clear that Apple knew what it was doing here, taking advantage of a weak (and apparently desperate) Irish Government in order to pocket billions of Euros in unpaid tax liabilities. That it has been told to repay the missing taxes should not be a surprise. That it will appeal shouldn’t be either. Let’s hope the EU stands up for the people and endorses this decision.

The US has been making threatening noises about this judgement going against Apple. It needs to sit down and shut up. These are taxes that were mainly due in Europe and should be paid in Europe. If the US hasn’t worked out how it can tax Apple for its offshore holdings then it should be supportive of any method of taxation which promotes the repatronisation of those moneys. And ensuring that Apple pays an appropriate level of tax wherever it recognises its profit is one way of doing this.

More importantly where are the punitive measures against the Irish Government, who effectively colluded with Apple to provide a bolt hole to defraud other European Governments of tax dollars owed on sales within their borders? In prostituting itself so openly to large corporations the Irish Government has revealed itself to fall far short of the standards of morality that those in power should be held to.

To follow the Irish model introduces a race to the bottom. Ireland offers Apple a 1% rate, Poland retaliates with a 0.5% rate and Britain goes all in at 0%. Which country starts giving big business Corporation Tax rebates to entice to develop there?

What I should emphasise is that Apple has done nothing wrong here, the job of the Board is to maximise shareholder value. In taking up Ireland’s very generous offer and using it to minimise tax liability it has followed that requirement to the letter.

However it is the job of governments to ensure a fair and equitable tax structure that does not allow big business to push the tax burden onto the individual. The Irish Government failed so badly in this duty that a new word needs to be invented to describe this level of fail.

Apple now needs to pay its tax bill and be a good member of the community. Appealing and arguing it was an innocent party to the Irish Government’s siren call won’t wash.

And Google, Facebook, Amazon and Microsoft it’s time to look to your tax liabilities, because the EU looks to be playing hard ball here and you’re next up to bat.

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