The EU’s investigating those Google, Vodafone, Amazon and Apple tax deals
I’M not sure how far they’ll get though, based on what it is that they seem to be investigating.
This is all about the Starbucks n’ Google n’ Vodafone n’ Apple stuff. How can they be doing so much business and paying so little in tax?
According to a US Senate report earlier this year Apple has a ‘special deal’ with Dublin and pays no more than two per cent tax on profits, at least 10 per cent below what some other businesses have to in Ireland.
Either the US Senate of the Mail don’t understand what is happening here. Apple doesn’t pay 2% in Ireland: it pays 12.5% just like every other business in Ireland. However, Ireland runs what is called a territorial tax system. Meaning that you only pay tax on business that really happens in Ireland. Stuff that happens through an Irish company but that takes place elsewhere doesn’t get taxed at all. So, Apple Eire buys from China and sells in the UK: no tax.
The 2% is the average tax rate that Apple pays on all its foreign trade, not some special deal just for them in Ireland.
The subcommittee’s report estimates that Apple avoided at least $3.5 billion in US taxes in 2011 and $9 billion in 2012 by using the tactic.
Posted: 13th, September 2013 | In: Money Comment | TrackBack | Permalink
