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  • #995240
    Taxopia
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    This has been going on in Australia for just as long and it would be nice to see our Federal Government go after big players with the same vigour (it is starting but likely to be toothless attempt). This conduct really makes you question the ethics of some of these large companies that have little regard for the countries they sell into and benefit greatly from. There is absolutely nothing wrong with tax optimisation but many of these large organisations probably pay a far lower rate of tax than the average Australian family. Is that right or wrong? (well wrong when its illegal as per this case).

    Extract EU Commission Press Release.30 August 2016

    In fact, the tax treatment in Ireland enabled Apple to avoid taxation on almost all profits generated by sales of Apple products in the entire EU Single Market. This is due to Apple’s decision to record all sales in Ireland rather than in the countries where the products were sold.

    This selective tax treatment of Apple in Ireland is illegal under EU state aid rules, because it gives Apple a significant advantage over other businesses that are subject to the same national taxation rules. The Commission can order recovery of illegal state aid for a ten-year period preceding the Commission’s first request for information in 2013. Ireland must now recover the unpaid taxes in Ireland from Apple for the years 2003 to 2014 of up to €13 billion, plus interest.

    #1200782
    LukeHally
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    My point of view is unpopular with a lot of my friends, will be interesting to see what business owners think. I guess there are a few angles to this. I’m assuming the the Irish government deliberately made their tax system attractive for this very purpose, so I don’t think it’s fair for the company to get all the blame.

    I think it’s lazy of our government to blame companies, they created the laws and they could definitely be more competitive and charge less tax.

    Is it right or wrong for companies to pay little tax? Is the amount of tax paid a measure of contribution to society? With globalisation has it become a proxy for contribution? I like to think of my contribution to society will be the benefit we give our customers, the number of jobs we will create. Personally I disagree with a lot of government spending, so I will minimise my tax as much as is legally possible.

    I get an extra hour productivity a day thanks to my iPad on the train, I’m satisfied that I got value fro my money. I’m not concerned about their tax avoidance – as long as it’s within the law (which in this case appears not to be).

    #1200783
    LucasArthur
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    This is such an interesting topic, and one that i find difficult to contribute to due to my limited legal and ‘worldly’ understanding of legal practices etc etc… From a personal perspective, the ability for companies to shift recorded sales offshore when the simplicity of the transaction occurred in country (1) but recorded in country (2) makes little sense to me since country (1) is where the sale took place..

    Based on the above, is revenue was derived from a transaction within country (1) should revenues not be declared within that region as well? This is not an argument of for or against, its just a logical thought process…

    What i find more interesting is that governments will protect employees rights and register it ‘locally’ as staff recruited locally and yet revenues derived locally are not recorded locally for tax purposes – how does this make sense? Employees like these big boys can avoid taxes for company reasons although can not avoid staff obligations (which i understand and not saying should be avoided but just drawing a comparison).

    From a smaller operator, i can see how people feel cheated by these corporations as they receive benefits to trade here and concessions in some cases and yet dont contribute a portion of their obligated tax payments within said country the revenue was derived from.

    Again, this is not a legal observation as the laws of the world are obviously geared to allow this.. But should it be? Why can one corporation blatantly reduce tax in this manner and not pay a local duty that is in place for all other enterprises within said country?

    Now, this is not just about a BAD APPLE, as there are a few big retailers locally that are also offshoring for this purpose now as well.. Will not mention it, although i know of a handful of commonly named businesses housed out of Ireland (LOL) and also Hong Kong for same intensive purposes – and what is funny, a few of these are regulars on TV and proudly spruik that they are Aussies achieving well and supporting the country – NOW this is shameful!

    Cheers
    Jason

    Jason Ramage | Lucas Arthur Pty Ltd | E: [email protected]   P: 61 3 8324 0344    M: 61 412 244 888
    #1200784
    Johny
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    “This conduct really makes you question the ethics of some of these large companies that have little regard for the countries they sell into and benefit greatly from.”

    I have no problem with companies trying to avoid tax. It could be argued they aren’t acting prudently if not seeking ways to minimize tax – done within the law of course. There are two things that make stories like this so emotive. One is the amounts involved and the other is that it is about money, which is always a touchy subject and the reasons banks always cop it.

    There are false claims made by small business on their taxes each year (that meal that was really just a night out rather than a business meeting, that company car expense when it was used for personal use etc). These are actually worse than avoidance.

    Certain methods of tax avoidance are available to large companies because their accountants are smarter than the people who develop policy, and the policy hasn’t caught up with the real world.

    There is a reason so many multi nationals have offices in Ireland, and its not just the Guinness. Perhaps it is policy that should be blamed rather than the ability of a company to get around it. Having said that, this hasn’t played out yet with both Ireland and Apple to appeal apparently. But it did already play out in the US congress where it was decided Apple wasn’t doing anything wrong legally, but was a bit naughty in spirit by holding profits overseas. Will be interesting to see the end result here.

    In the meantime, I believe we all live in a world where consumers are much more conscious of ethical deficiencies in the companies they buy from. People could always boycott buying iphones if they feel that strongly about it. But would also have to boycott Google, Microsoft, Facebook etc as well, on that basis.

    #1200785
    bb1
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    It all comes down to the government of each country, if they were to enact laws which make it mandatory to pay tax in our country if the product was sold to a citizen of this country. Problem solved. Well that’s my simplistic view, and I know there are agreements and whatever else which may override that.

    Who makes the laws – The government
    Who elects the government – Us.
    So it is up to us to fix it.

    Very simplistic if you type it on a keyboard isn’t it. LOL.

    No correspondence will be entered into.

    #1200786
    bb1
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    The other thing the consumer can do is don’t buy the silly thing if you know your government, and as such you yourself is being ripped off by buying a product from one of these companies.

    Again it comes back to us. We have the power, we just choose to sit by silently and let ourselves be ripped off blindly

    #1200787
    arrowwise
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    It seems not to be illegal what they doing in the jurisdiction they are declaring their records / paying taxes in etc. The issue seems to be trading / selling / profiting in one place and only having to pay Tax (or majority of) somewhere else. A lot of these laws are lobbied / changed / revised by these said companies to allow them to continue to pursue their business interests. Places like Australia could impose more red-tape, requirements and Taxes for companies like this, however they equally can alter ways they do business each time they hit a road block of new Taxes. To a certain degree it seems to be a way of life on conduct by the majors in the global economy.

    No simple answers and the politicians locally don’t have a quick fix other than a lot of debates and opinions.

    #1200788
    Johny
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    Sometimes the simplistic views are the best Bert.

    Problem here is that it is not the country, it is the EU deciding that the laws of one country (Ireland) are not in line with the “good” of the whole (EU).

    That the Irish govt is looking to appeal the decision points to them not agreeing with it, based no doubt on their view that having these companies within Ireleand benefits them more than forgoing some taxes.

    Who is right? Who really ever knows.

    #1200789
    Corey
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    The Government allows it!

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