Ireland can use unwanted taxes to keep Apple sweet
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
By Aimee Donnellan
LONDON, Sept 10 (Reuters Breakingviews) -Big Tech taxes are not the Apple AAPL.O of Ireland’s eye. That is the message Dublin sent when it sided with the iPhone maker in a European Union dispute over 13 billion euros in corporate levies. On Tuesday, Europe’s top court ordered Tim Cook’s company to pay the funds. Prime Minister Simon Harris can use the unwanted money to improve the infrastructure big companies crave.
The saga over Apple’s Irish tax affairs dates back to 2016. After a lengthy legal back-and-forth, the European Court of Justice sided with the European Commission’s argument that the U.S. company paid too little taxes and ordered it to repay the funds into Dublin’s coffers.
Ireland feared that accepting Apple’s back taxes would scare away its corporate golden geese. The country attracts large multinationals like Pfizer PFE.N, Facebook owner Meta Platforms META.O and Salesforce CRM.N with its 12.5% corporate tax rate. Paradoxically, the tax take from foreign companies has put Dublin in the enviable position of having a budget surplus. Last year it amounted to 8.3 billion euros and it is likely to stay around that level in 2024.
But Ireland’s days as a corporate tax haven are already numbered. The country reluctantly signed up to an OECD tax treaty in 2021 which set corporation tax at a minimum of 15%. In theory, higher levies might prompt Apple & co. to move to Paris, Amsterdam or Madrid. But those countries, and indeed most EU members, have higher corporate tax rates. Bulgaria and Hungary, which charge companies even less than Ireland, don’t look like likely alternatives.
So Harris has some time to persuade Big Tech and Big Pharma to stay put. He could spend Apple’s taxes to increase Ireland’s attractiveness, even with a slightly tougher fiscal regime.
Dublin is in the throes of a decade-long housing crisis. In May, a survey by the Dublin Chamber revealed that two out of every three local businesses believe housing shortages impacted their ability to recruit staff. The lack of housing has increased rents by 60% since 2015, compared to 13% across the euro area, according to Eurostat. Transport is another weak area. Dublin is one of the few major cities in Europe without an underground train service and the government’s plan to build one has been delayed until 2035.
Ireland will have to handle its unwanted cash injection with care. But if it spruces up its infrastructure it may be able to keep the Apple and other companies from going sour on the country.
Follow @aimeedonnellan on X
CONTEXT NEWS
Apple on Sept.10 lost its fight against an order by European Union competition regulators to pay 13 billion euros ($14.4 billion) in back taxes to Ireland. The ruling by the European Court of Justice is a landmark decision in the EU’s crackdown against sweetheart fiscal deals between member states and multinationals.
The European Commission issued the order in 2016, saying that the iPhone maker benefited from two Irish tax rulings for over two decades that artificially reduced its tax burden to as low as 0.005% in 2014.
Apple had said the Commission’s decision defied reality and common sense. Ireland, whose low tax rates have helped to attract Big Tech to set up their European headquarters, had also challenged the EU ruling.
After the ECJ’s ruling, Apple said: "The European Commission is trying to retroactively change the rules and ignore that, as required by international tax law, our income was already subject to taxes in the U.S."
The decision is final and cannot be appealed.
Ireland's government finances are in good shape https://reut.rs/3XBbEFv
Editing by Francesco Guerrera and Streisand Neto
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آخر الأخبار
إخلاء المسؤولية: تتيح كيانات XM Group خدمة تنفيذية فقط والدخول إلى منصة تداولنا عبر الإنترنت، مما يسمح للشخص بمشاهدة و/أو استخدام المحتوى المتاح على موقع الويب أو عن طريقه، وهذا المحتوى لا يراد به التغيير أو التوسع عن ذلك. يخضع هذا الدخول والاستخدام دائماً لما يلي: (1) الشروط والأحكام؛ (2) تحذيرات المخاطر؛ (3) إخلاء المسؤولية الكامل. لذلك يُقدم هذا المحتوى على أنه ليس أكثر من معلومات عامة. تحديداً، يرجى الانتباه إلى أن المحتوى المتاح على منصة تداولنا عبر الإنترنت ليس طلباً أو عرضاً لدخول أي معاملات في الأسواق المالية. التداول في أي سوق مالي به مخاطرة عالية برأس مالك.
جميع المواد المنشورة على منصة تداولنا مخصصة للأغراض التعليمية/المعلوماتية فقط ولا تحتوي - ولا ينبغي اعتبار أنها تحتوي - على نصائح أو توصيات مالية أو ضريبية أو تجارية، أو سجلاً لأسعار تداولنا، أو عرضاً أو طلباً لأي معاملة في أي صكوك مالية أو عروض ترويجية مالية لا داعي لها.
أي محتوى تابع للغير بالإضافة إلى المحتوى الذي أعدته XM، مثل الآراء، والأخبار، والأبحاث، والتحليلات والأسعار وغيرها من المعلومات أو روابط مواقع تابعة للغير وواردة في هذا الموقع تُقدم لك "كما هي"، كتعليق عام على السوق ولا تعتبر نصيحة استثمارية. يجب ألا يُفسر أي محتوى على أنه بحث استثماري، وأن تلاحظ وتقبل أن المحتوى غير مُعدٍ وفقاً للمتطلبات القانونية المصممة لتعزيز استقلالية البحث الاستثماري، وبالتالي، فهو بمثابة تواصل تسويقي بموجب القوانين واللوائح ذات الصلة. فضلاً تأكد من أنك قد قرأت وفهمت الإخطار بالبحوث الاستثمارية غير المستقلة والتحذير من مخاطر المعلومات السابقة، والذي يمكنك الاطلاع عليه هنا.
