The U.S. wanted to be in Apple’s corner for its battle against the European Union, but a ruling from the EU’s highest court means that the United States is going to have to keep its distance.
The court upheld a previous December decision from a lower court, stating that the American government has not proved that it has any direct interest in the state aid case against Apple.
Apple CEO Tim Cook was reportedly “most helpful” during his White House meeting with President Donald Trump earlier this week. Cook was enthusiastic about the Trump administration’s recent tax cuts, and also had some advice about business dealings in China.
“I really enjoyed the meeting,” Larry Kudlow, director of the National Economic Council, told CNBC’s Squawk on the Street. “I spent a good amount of time with [Cook], and then we came back and we visited the POTUS.”
The iPhone and other major tech products are safe from Trump’s brewing trade war with China.
On Tuesday, the office of the U.S. Trade Representative revealed that it was slapping 25 percent tariffs on 1,300 products coming from China related to technology, transport and medical products. iPhone components were exempt from the list, but other products like magnetic hard drives and flat-panel television sets were hit hard.
The European Commission wants tech giants like Apple and other “digital businesses” to pay their fair share of taxes, and it’s announced new proposals to help implement this.
As previously suggested by French Finance Minister Bruno Le Maire, the proposed rules mean that companies would have to pay taxes throughout the EU, and not just in the location of the European headquarters.
Apple is among the tech giants which could be affected by a new European Union initiative that aims to tax tech multinationals at between 2 to 6 percent of their global revenue.
News of the massive potential tax shift was shared by French Finance Minister Bruno Le Maire in a newspaper interview. Le Maire said that the total amount is likely to be “closer to 2 percent than 6 percent,” and will be announced in the coming weeks.
Apple is cutting back on the purchasing of corporate bonds as it prepares to bring home overseas cash. Changes to tax laws in the United States mean Apple no longer needs to hold so much money in foreign countries. Alphabet and Oracle are also cutting back.
Apple will pay its 13 billion euros ($15.5 billion) tax bill between March and September this year, Ireland’s Department of Finance Secretary General Derek Moran has told the country’s Public Accounts Committee.
The European Commission ordered the Irish government to recover the money from Apple after ruling that it received illegal state aid in Ireland. While Ireland is still appealing the decision, it must still collect the money, which will then be placed in an escrow account until the dispute is settled.
Apple Europe has agreed to pay an additional $186 million, including interest on unpaid tax, after an “extensive audit” by HM Revenue and Customs, the U.K. government department responsible for the collection of taxes.
The “corporate income tax adjustment” in the United Kingdom covers the years through September 2015, and reflects Apple’s “increased activity” during that period. The adjustment will be factored into future tax bills paid by Apple.
The newly-passed Republican tax overhaul will allow Apple to repatriate its giant $252.3 billion overseas cash pile without paying as much tax as it would have previously.
Under the new rules, it would be able to take advantage of a one-off 15.5 percent tax rate, meaning it would owe around $39.1 billion — much of which Apple has already set aside for the purpose.
The U.K. Treasury has announced plans to crack down on tech giants which use overseas profit-shifting strategies to cut down on the amount of tax they have to pay.
Chancellor Philip Hammond announced that the country will now charge a 20 percent income tax rate on any British earnings held overseas, starting April 2019.
In the latest instalment of Apple’s battles with the European Union over taxes, Ireland is set to miss a deadline to hire managers to cary out the collection of its owed taxes.
The Irish debt office previously said that it would hire custodians and investment managers for the estimated $15.3 billion tax bill it was awarded by mid-November. However, Ireland — which has fought against collecting the funds from Apple — hasn’t handed out the contracts as it said it would in tender documents.
Apple has denied that it moved some of its operations from Ireland to Jersey, one of the largest of the Channel Islands, as an offshore tax haven so as to keep hold of its low tax rate.
The company issued a statement in the wake of the “Paradise Papers” reveal, showing details about how wealthy individuals and companies move large quantities of money overseas to bypass taxes. However, Apple says that no actual operations or investments were moved from Ireland.
Tim Cook is currently in France, where he making a variety of visits — including meeting with President Emmanuel Macron.
Cook will meet with President Macron, who assumed power in this year’s May election, later today. He has also made a number of stops, including meeting with one of Apple’s suppliers and paying his respects at the Normandy American Cemetery and Memorial, which honors American troops who died in Europe during World War II.
Ireland could receive an official rebuke from European Union authorities this week for failing to collect the $17.6 billion tax payment it is owed by Apple.
Apple was supposed to pay the money way back on January 3, but Ireland has continued to battle against the case — with the majority of the country saying it doesn’t want Apple’s money. As a result, the European Commission may issue a so-called “non-compliance action” against Ireland.
As part of his plans for cutting business rates, President Donald Trump and congressional Republicans have proposed a new tax that could have a big impact on Silicon Valley tech giants including Apple.
The proposal — designed to stop companies from shifting their profits to overseas tax havens — calls for “rules to protect the U.S. tax base by taxing at a reduced rate and on a global basis the foreign profits of U.S. multinational corporations.”
France and Germany are looking to crack down on loopholes that allow U.S. tech companies, including Apple, to minimize their tax contributions at the expense of local rivals.
According to a new report, France will kick things off by proposing “simpler rules” for taxing tech giants. These will be revealed at a meeting with EU officials in mid-September.
Apple’s second quarterly earnings report of 2017 will likely reveal the company now has over a quarter of a trillion dollars of cash stashed in the bank.
The iPhone-maker has so much cash its reserves exceed the foreign-currency reserves of the U.K. and Canada combined. During the last quarter of 2017, Apple’s money-making machine was earning $3.6 million per hour.
Apple has filed a defense against its massive European Commission tax bill, arguing that it shouldn’t have to pay its $14 billion tax bill, and that the request should be either totally or partially annulled.
The argument, essentially, is a 14-point extension of Tim Cook’s previous assertion that existing tax codes are designed for an industrial, rather than a digital age.
Apple asserts that the European Commission misunderstands Apple’s business dealings, and says the reason it shouldn’t have to pay massive taxes in Ireland is because the actual profit-driving work Apple does is carried out elsewhere.
Undeterred by its massive tax bill from the European Commission, Apple has confirmed it is shifting its international iTunes business from Luxembourg to Ireland.
The move, which will take place on February 5, was announced in an email to developers today. However, Apple started planning for it last September when it transferred all developer accounts and around $9 billion in assets from Luxembourg to Ireland.
Apple’s massive tax bill from the European Commission is tantamount to an ill-advised “land grab” and could be reversed in court, claims Feargal O’Rourke, the man who heads up the tax practice at PricewaterhouseCoopers in Ireland.
Speaking at the Irish Times corporation tax summit in Dublin, O’Rourke said he is confident the Commission’s decision will be overturned by the European Court of Justice.
Apple will hike App Store prices for users in the U.K. due to fluctuating exchange rates and taxation changes.
U.K. prices will go up by at least 25 percent within the next seven days, and Turkey, India and other countries can also expect to see increases, Apple said.
Apple has launched its legal challenge against the European Union’s demand of $14 billion in allegedly unpaid back taxes.
In a statement, Apple general counsel Bruce Sewell said Cupertino has been targeted because of its success, implying that European legislators picked on the company for largely symbolic reasons.
Apple has been hit with another massive fine in Europe, as French tax authorities recently issued the company with a 400 million euro ($422 million) bill, according to French newspaper L’Express.
As with a lot of Apple’s other tax issues, the complaint reportedly relates to Apple’s tax optimizing strategy of channelling profits through its Irish subsidiary.
An Apple executive has avoided jail as part of an Italian investigation into Apple’s failure to pay corporate tax in the country.
The executive in question, the head of Apple’s Irish-based Apple Sales International, was being investigated as part of the case. Apple agreed to pay 318 million euros last year to close the investigation, but the exec could still have been forced to spend six months in prison for his part in it.
European Union finance ministers reportedly discussed how to divvy up the windfall from Apple’s 13 billion euros tax bill at a closed-door meeting in Slovakia over the weekend.
Some European governments were reportedly more keen on getting their hands on Apple’s money than others, with Germany’s Wolfgang Schäuble saying, “Of course we’re looking into it.”
