Australia’s TheAge details this morning how despite earning a profit of $900 million on revenue of over $9 billion in 2018 in Australia, Apple’s tax bill shrunk by nearly $19 million. This brought the company’s total Australian tax bill to $164 million.
Austria is the next European nation looking to impose a specialized ‘tech tax’ on internet giants such as Amazon, Apple, and Facebook. This move follows in the footsteps of France and Germany to take action on a national level rather than awaiting an EU-wide agreement.
Just two weeks ago, French Economy and Finance Minister Bruno Le Maire announced the new GAFA (Google, Apple, Facebook, Amazon) tax would take effect starting January 1. The country hopes to generate as much as 500 million euros in the tax’s first year in effect.
France is set to impose a sweeping new law starting January 1 which is set to raise as much as 500 million euros in 2019 alone.
The tax, dubbed GAFA for Google, Apple, Facebook and Amazon, is targeted towards high-profit internet tech giants who generally pay a lower effective tax rate than other corporations, reports AFP News.
[UPDATE: Cupertino mayor Barry Chang is refuting the claims made by The Guardian, saying that he never said the words quoted in the article: “I was shocked and dismayed to see a recent article quoting me with words I never used and describing situations that never happened,” he said in a statement on the Cupertino city website.]
Cupertino mayor Barry Chang has accused Apple of ‘abusing’ its home city by failing to contribute to much-needed public projects, and claims that he was ‘surrounded’ by security and escorted off the premises when he tried to discuss traffic congestion.
Apple is not willing to pay a dime. They’re making profit, and they should share the responsibility for our city, but they won’t. They abuse us.
However, the Guardian notes that Apple paid $9.2M in city taxes in 2012/13 …
In an interview with the BBC on national British radio, Apple co-founder Steve Wozniak said that he believes Apple should pay 50% tax, along with all other companies. He said he doesn’t like the distinction of different rules between corporations and individuals.
Today, although Apple has never been found to evade tax or conduct illegal practices, it does not pay at top-rate tax, using a variety of financial engineering schemes to redirect profits elsewhere, such as Ireland, with significantly lower tax requirements.
The European Union warned us this week not to expect a speedy conclusion to the long-running investigation into the legality of Apple’s tax arrangements in Europe. The delay follows a decision back in December to expand the scope of the investigation.
But while the wheels of EU tax investigations may grind exceedingly slowly, I’d be willing to wager quite large sums of money on the final outcome. It looks to me increasingly clear that Apple’s tax arrangements with the Irish government are going to be declared illegal, and that Apple is going to be faced with a significant bill for unpaid tax …
European Union competition chief Margrethe Vestager has warned reporters not to expect a quick decision from the investigation into whether or not Apple’s tax arrangements in Europe are legal, reports Bloomberg.
“Don’t hold your breath,” she told reporters in Brussels on Monday about the timing of decisions targeting Apple and online shopping giant Amazon.com Inc, whose tax affairs in Luxembourg are also under intense scrutiny. “I’m just warning you.”
Apple uses Ireland as its European headquarters, funneling most revenue through the country, where it has a special arrangement with the Irish government to pay corporation tax of just 2.5%. The EU believes this arrangement may be illegal for two reasons …
In what Bloomberg describes as ‘a 90-minute interview peppered with expletives,’ Russia’s new Internet advisor has said that he wants to force Apple and Google to pay more taxes.
German Klimenko is pushing to raise taxes on U.S. companies to help level the playing field for Russian competitors such as Yandex and Mail.ru […]
Bloomberg says that he has an interesting ally in this aim …
The European Commission has ruled that tax breaks offered by Belgium to multinational companies are illegal, and that the companies concerned must pay the full rate of tax due in the country, reports VentureBeat. This follows similar decisions in Luxembourg and the Netherlands.
While none of these rulings directly impact Apple, they do make it look extremely likely that the Commission will reach the same decision in Ireland, where Apple pays just 2.5% corporation tax instead of the normal 12.5%.
The Irish government offered Apple the special deal in order to encourage the company to choose the country as its European headquarters. The European Commission has been running a lengthy investigation into the legality of this arrangement, and has recently extended and expanded its scope.
If Ireland is indeed found to have broken the law, Apple will have to pay the difference in tax for up to ten years. The total amount was estimated last year at $2.5 billion. Apple warned shareholders at the time that it may face ‘material’ back taxes should the decision go against it.
The EC isn’t the only entity unhappy with Apple’s tax arrangements in Ireland either. The Italian government accused Apple of failing to declare more than $1.3 billion of corporation tax in the country as a result of funneling profits through to Ireland. Apple, which has 16 retail stores in the country, recently agreed to pay the full €318M ($347M) claimed by the Italian tax office.
Photo: AP Photo/Rick Rycroft
Covent Garden, London – one of the largest Apple Stores in the world
New corporate tax measures aimed at preventing multinational companies making profits in the UK and then shifting them overseas where they incur lower taxes could potentially impact a number of tech companies, including Apple, Google and Amazon.
The British government announced a new 25% tax on profits generated in the UK and then “artificially shifted” overseas, reports the BBC …
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Photo: mashable.com
I’m sure most of us have at some point had Windows- and Android-using friends ask us why we pay the ‘Apple tax’ – the price difference between an Apple product and what they perceive to be an equivalent competitor product.
A large part of the answer, of course, is that the competitor product isn’t equivalent at all. You can’t compare a MacBook with its premium materials, build-quality, high-spec components, screen quality and aesthetics with a low-end Windows laptop with plastic casing, low-spec innards and cheap and cheerful display. No more than you can compare an iPhone with a budget ‘droid. When you do genuine like-for-like comparisons with truly equivalent products, the Apple premium shrinks considerably.
But to get an accurate idea of the effective purchase cost, you also need to take into account both the replacement cycle and resale value …
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A four-month long investigation into Apple’s tax affairs by the Securities and Exchange Commission has cleared the company of any wrong-doing in regard to the way the company accounted for taxes in respect of its overseas operations.
A Senate Permanent Subcommittee on Investigations hearing into Apple’s tax affairs had previously accused the company of seeking “the Holy Grail of tax avoidance” over cash held overseas. The hearing proved anti-climatic, with no wrong-doing established, and the investigation handed off to the SEC. The SEC has now closed the case.
Tim Cook made an unequivocal statement during the Senate hearing that Apple used no tax gimmicks …
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