Tim Cook in Ireland to collect award, says global corporate tax reform needed

Tim Cook is in Ireland to receive an award in recognition of Apple’s 40 years of investment in Ireland. Apple’s CEO is set to collect that award from prime minister Leo Varadkar.

While there, Cook indirectly addressed criticism of Apple’s use of Ireland as its European HQ in order to reduce its tax bill in Europe…

Cook said today that everyone knows the current global taxation system for multinational companies needs reform, reports Reuters.

I think logically everybody knows it needs to be rehauled, I would certainly be the last person to say that the current system or the past system was the perfect system. I’m hopeful and optimistic that [the OECD] will find something.

More than 130 countries have now agreed on the need for a coordinated approach to preventing corporate tax avoidance. The Organisation for Economic Cooperation and Development (OECD) is now working on a plan to ensure companies pay corporation tax in each of the countries in which they operate.

Apple and other tech giants will in future be required to pay tax in each country in which they sell products and services. Apple, for example, will no longer be able to funnel profits from all European Apple Stores through Ireland as a means of avoiding tax in the countries where the products are actually sold […]

Ireland will be likely to lose tax revenue as a result of the changes, but most countries will benefit, as companies will pay tax in each country based on the profits they make from their local sales […]

To ensure a level playing field, a standard tax formula will be applied by all signatories to the agreement, based on a percentage of profits from local sales.

Should companies use creative accounting to claim no profit has been made within a particular country, for example by payment of large royalty payments to a division based in another country, a second OECD measure will kick in, which will ensure taxation of local revenue – albeit at a likely very low rate.

As is usual when Cook makes an overseas trip, he also meets with local artists, developers and staff and customers in Apple Stores. Tim Cook in Ireland has so far tweeted about meeting musician Hozier and AR game developers War Ducks.

What an amazing welcome back to Ireland! Thank you @Hozier for sharing your music with me, and for the chance to look around the studio. Feel free to reach out if you ever need some backup vocals. 🎶 pic.twitter.com/Opfka0j2UK

— Tim Cook (@tim_cook) January 19, 2020

.@War_Ducks set out to create a game with fun, engaging and colorful characters, and they nailed it. Awesome to see how @NikkiLannen and her talented team in Dublin are embracing AR to take their games to the next level! pic.twitter.com/bjL15fWlPY

— Tim Cook (@tim_cook) January 20, 2020

Hozier jokingly replied that he might take up Cook on his backing vocals offer.

Careful now, I might hold you to that! Pleasure to meet and chat to you today about music, thanks for joining me at @camdenrecording. Safe travels 🖤 https://t.co/67z0g0OAQR

— Hozier (@Hozier) January 19, 2020