Apple – Pay Your Tax!!
There’s nothing more infuriating in the days of austerity to find out that someone isn’t paying their tax bill – and consequently, the tax bills for people that already pay them, like us, rise and continue to rise to make up the shortfall.
David Cameron, our dearly beloved former Prime Minister, once said “those with the broadest shoulders should carry more of the burden”. He was alluding to the fact that the United Kingdom should embrace a more progressive tax system – it hasn’t quite happened yet… but I’m sure it’s on somebodies to-do list (please, stop laughing!).
Turns out, among the many companies that are alleged to be participating in tax jiggery-pokery, Apple have gone for the top prize. Apple’s UK and European operations are HQ’d in the Republic of Ireland.
How Much?
Well, how much has been ‘avoided’ (we’re being kind here, whilst not technically evasion – most people will be forgiven for feeling that this is tax evasion, even if not specifically – the ‘correct’ term in this case is ‘cosy tax deals with the authorities’), we’ve got an idea – but ultimately it’s up to the Irish tax authorities to decide.
We’re looking at a minimum of £11 billion – that’s right – £11, 000, 000, 000 in unpaid tax. This is an estimate provided by the European Union. Some analysts and accountants have said that the true figure, according to their calculations could be £20 billion – that’s right – £20, 000, 000, 000. Enough for a decent holiday, right?
However, this is not just any other tax scandal but actually, in all likelihood, the tax scandal of all tax scandals. The biggest, the “best”, the most outrageous. Corporate greed at it’s height… and here’s why:
0.005% Tax Rate
Apple seems to have managed to negotiate some kind of marginal tax rate. I’ll admit, that most people would like to have a personal tax rate this low, but unfortunately it’s just not sustainable even if you want to have the most basic of societies.
Now a 0.005% corporation tax rate isn’t illegal. However, charging other businesses (including competitors) 12.5% whilst charging another company 0.005% under some kind of special agreement is illegal. It’s firmly against the rules set out by the European Union – of which the Republic of Ireland is a full member of. The EU classes this as unlawful ‘state aid’ – i.e. giving some companies a leg up whilst taxing others the full amount.
What makes this even more outrageous is the fact that the corporation tax rate in Ireland is already rock bottom compared to most developed economies, standing at just 12.5%. To put this in context the UK’s corporation tax rate has been lowered in numerous years following the Global Financial Crisis however this still stands at 20%. Turns out, 12.5% was just way too much for Apple. In fact, in their eyes, it appears 1.25% was way too much too.
Apple is the Biggest Company on Earth
That’s right, Apple is the largest corporate entity on Earth – which isn’t surprising. Have you seen how much iPhones and Macs cost these days!?
There profits year on year are usually above $50 billion.
But, But, But – This Will Destroy Apple and I Like iStuff
Chill out, Apple is going nowhere. It’s a license to print money. If Apple collapses, so does capitalism ;-).
But seriously, there’s no need to worry. Apple currently have approximately $200 billion rolling around in a bank account – even having to pay a much larger bill on $50 billion, they’ve still got reserves many millions/billions of times bigger than most companies on the planet.
To be fair – this isn’t Apple getting fined. They wouldn’t have a current account balance of $200 billion had they actually paid their bloody taxes! So don’t feel sorry for them – they’ll be fine.
Ireland are Appealing?
Obviously, Apple are appealing the decision and the United States Government, including the Treasury, are sticking their oar in.
But, guess what, Ireland are appealing as well. Cue shocked faces.
Why is Ireland appealing this landmark tax ruling? I guess they don’t want to annoy Apple. However, maybe the Irish government should consider how annoyed Irish tax payers are/will be that they are paying more tax because multi-national corporations based in their country are paying next to no tax?
Really it beggars belief. To put this in context:
It’s no secret that Ireland, along with every other developed nation in the world, is still proceeding through a Global Financial Crisis that has brought financial services and governments to their knees. Ireland know this – after all they needed bailing out by the United Kingdom, the European Union and the International Monetary Fund.
Now the EU are handing them (essentially) a cheque with their name on it for a minimum of €13 billion.
13 billion euros – that’ll probably come in handy to pay down some of the estimated €206 billion national debt that Ireland has – which is currently running at 103.38% of GDP.
Maybe, however, they’re just playing a game. “Oh no, course we don’t want it. GIMMIE THE CHEQUE!!”. Undoubtedly, any government in this day and age that declines (genuinely!) free money is clearly off it’s rocker.
Apple – Pay Your Tax Bill!
Apple charge us lots for shiny things. We pay. They make lots of money and are happy. Just as with everyone who makes money, you have to pay the rate of tax proportionate to your income. That’s the way this thing works. That way, we’re not expecting those on National Minimum Wage to pay a nominal tax rate of 97.8% and make a solitary tin of bins last the whole month ;-).
There’s really no excuse for a company earning mega profits not to be paying their fair share of very low rate taxes – namely 12.5%.
Apple would probably be best to cough up and get this out of media spotlight ASAP. It’s really not worth it to any company to have to cope with years of legal wrangling with the ECJ when you know you are morally in the wrong.
Expect Apple popularity to drop somewhat and some people to boycott them if they keep up the whole ‘I only want to pay 0.00000000000000000000000000000000000000000000000000000000000000000000000000000000000001% tax routine’.
