VAT is irrelevant for companies.
Apple collects VAT on behalf of the EU governments when selling products and passes those on to the respective governments. Other companies collect VAT on behalf of the same governments when selling products or services to Apple; Apple gets reimbursed by the same governments for the VAT it paid. It's effectively a zero sum game.
The customers pay VAT, Apple only collects it on behalf of the governments and passes it on (after deducting whatever VAT they already paid on their expenses).
This is why in EU countries prices for end users are typically presented as flat sums (VAT included) but prices for businesses are generally presented with VAT listed separately (because businesses don't care about the VAT they pay themselves).
Edit: why do you think business lobby groups are constantly asking the govt to reduce VAT? Have you ever heard of the demand curve?
You're not selling the product for $100, you're selling it at $83.33 plus VAT. That means your customer will have to part with $100, though. If your customer is not willing to pay >= $108 for the product (i.e. $90 plus VAT), of course you're operating at a loss.
You could argue this is just semantics but B2C retail is the only major example where VAT matters. And considering we're talking about Apple I'm not convinced Apple's profit margins have Tim Cooke worried about EU VAT.
In the vast majority of cases, an enterprise software company will collect far more VAT than it pays out, so it's not zero sum.
* Their employees pay whatever tax they pay just like anybody else
* They pay VAT on all utilities they consume like every company ( shocker )
* They pay almost NO TAX over their profits unlike 99% of the companies, and that's the problem.
And if you think you'll benefit in any way from them not paying taxes, you're just as delusional as the "French communists in Brussels" ( whatever that even means?!)
What companies that are domiciled outside of the EU pay corporation tax in the EU? Corp tax is levied by the govt of the country of domicile, always has been. Why is it suddenly up for debate?
Apple is domiciled in the EU for their European operations. What are you suggesting?
I doubt that. I'm pretty sure BMW US is a local LLC that might owned by the parent but is fully taxed on their operations in the US.
Apple doesn't. (or rarely does). Amazon doesn't. Microsoft does less and less.
They are billing locally. They have local accounts in which local payments are made.
so no, they have local revenue. Value is created there.
That statement is just not correct. When you buy a product of Apple in Europe you buy it in Ireland and not in the US. When you buy a VW in the US you also buy it from a US retailed who bought it at a US subsidiary in the US which pays american corporate tax.
Apple is free to import the products from the US and to then pay import duty, sell it off to local merchants and then to pay american corporate tax on their earnings. Apple did not want to do that.
That's not their position, that's their words. Or why do they hide the billions since years if they want their profits to be taxed in the US?
But they have the accounts of the local subsidiary. And that local subsidiary either makes a profit or not.
And, the company is taxed in each country of operations, for relevant operations.
The subsidiary will usually have accounts that have costs like salary and premises, and no direct revenues, just a big cash transfer to fund the costs from the parent company.
The main reason why subsidiaries are set up is to enter a market and sell stuff. The main reason tax is discussed is because sales/revenue/profit is generated in one place.
And they do set up arbitrary prices within the limits of anti-dumping laws. But then again, someone somewhere will tax something.
>no direct revenues, just a big cash transfer to fund the costs from the parent company
In Apple (and many others' case), the local subsidiary has revenue. They actually bill consumers and collect payments.
Sure, and if it did, the parent would make a massive profit they would have to pay taxes on.
Someone at some point has to pay taxes on the profits. Apple just pressured Ireland into looking the other way and granting a tax scheme that is not actually valid and the EC has corrected that by pointing out Apple failed to pay taxes it legally owed.