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Comment by k-mcgrady | Hacker News Reader

I think generally Apple has been a pretty socially responsible company, more so than a lot of other tech companies. I also really admire their stance on privacy. They get no sympathy from me here though and this 'message' makes them look worse. When you have $200bn in cash reserves - literally $200bn you have no idea what to do with - and you're complaining about paying $14bn in back taxes you just make yourself look bad. The excuse that you brought jobs to a struggling economy also doesn't help you. You didn't look at Ireland and say 'those poor unemployed people, lets open an office there', you said 'they really need jobs, we can probably negotiate a good deal'.

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I would agree with you if it were really a case of Apple dodging tax by (for example) lying about their revenues to reduce their tax bill.

Except it's not. Apple paid all the tax Ireland asked for. The problem is the EU are saying Ireland should have different tax laws and therefore Apple should now pay Ireland retrospective taxes based on what the UN thinks Ireland's tax law should have been in the past.

The problem with that should be mind-numbingly self-evident.

1. It's the EU, not the UN.

2. My understanding is that Ireland's tax laws should meet a certain EU standard. Apple was meeting Ireland's laws but Ireland was not meeting the EU's and thus Apple wasn't paying the correct amount of tax. So the laws have always been in place, they just weren't being followed correctly by Ireland or by Apple.

1. Fixed, oops!

2. That sounds like fault lies with Ireland, not Apple. Or perhaps with the EU for failing to enforce their own damn rules.

>> "That sounds like fault lies with Ireland, not Apple. Or perhaps with the EU for failing to enforce their own damn rules."

This decision is the EU enforcing the laws though. And I think the fault does lie with Ireland - but nobody is saying the fault lies with Apple. That's why they're not being fined. They're just being told to pay money they have always owed, money which was never theirs. I can see it from both sides though. Why should Apple be 'punished' if they were told they were paying the right amount? On the other hand if my accountant screws up my taxes and I pay too little I have to pay it back eventually.

>> "They're just being told to pay money they have always owed"

...to an entity that repeatedly insists they're not owed it.

True but Ireland has an interest in fighting this too. There are potentially thousands of jobs on the line plus a lot of future investment. I don't think this will cause any companies to leave Ireland as there is now going to be nowhere else in the EU they can run this tax deal but it takes away an edge they have on investment over other major European cities.

So it wasn't Apple's fault then, right? Which means it's a business between EU and Ireland, and Apple has nothing to do with it.

No, that's not right.

The idea that state aid laws are relevant to corporation tax levels is a relatively recent phenomenon in the EU which is why these tax setups date back decades and it's only now that the EU has suddenly "discovered" that they're illegal.

The laws have not always been in place and not being followed. Rather, an extremely vague set of EU powers is now being stretched past the limit in order to enforce EU policy of the day.

Have you got any good info on the state aid laws? I've seen it mentioned in every news story on this and not one has the courtesy to explain it.

Judging from what you're saying though the law has always been in place and no new law has been created to enforce this decision - it's just an old law being interpreted to cover this scenario. Is that correct?

Yes, state aid laws are old. But they were put in place and are intended for situations where governments are subsidising weak local companies or industries that wouldn't survive if exposed to (intra-EU) competition unsubsidised. That's why they call it "aid".

But nobody is arguing that Apple is weak and needs to be protected from foreign competition in this case. Apple is the foreign competition. And Ireland isn't paying them money to keep them afloat. So this is a very different sort of situation to what state aid rules were designed for, and that's why the EU is using such a tortured definition of "aid". The Commission has wanted to control and harmonise member state tax policies for a long time but know governments would never let them when asked directly. So they are finding ways to bend old powers to their latest needs.

Hmm that's really interesting. I'm definitely going to be reading up more on this but it seems like Ireland is kind of giving itself state aid in a way by offering Apple a nice deal and therefore Ireland doesn't face competition from other EU member states. If that's the case, even if it didn't fall under state aid something should be in place to prevent it I think or we'll just face a race to the bottom.

Thanks for the info!

> The problem is the UN are saying Ireland should have different tax laws and therefore Apple should now pay Ireland retrospective taxes based on what the UN thinks Ireland's tax law should have been in the past.

No, the EC is not saying anything about the tax laws of Ireland

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