Apple Inc on Monday appealed against a US$14 billion tax demand as the EU issued details of its ruling that the iPhone maker won sweetheart tax deals from the Irish government which amounted to illegal subsidies.
The tech giant’s combative stand — its lead lawyer told reporters that Apple was a “convenient target” for an EU antitrust chief driven by “headlines” — underlined its anger with the European Commission, which it says ignored evidence from Irish experts before the decision on Aug. 30.
US President Barack Obama’s administration also voiced displeasure at what it said was the EU helping itself to cash that should have ended up in the US while many in Silicon Valley saw it as further proof that an envious Europe, having lost out on new tech markets, is trying to rig regulations against them.
EU Commissioner for Competition Margrethe Vestager has rejected those claims and on Monday, while making no new comment on a case which is also being appealed by the Dublin government, the EU executive published an edited text of her judgment.
Apple’s Irish tax arrangements have allowed it to pay tax at a rate of 3.8 percent on US$200 billion of overseas profits over the past 10 years, according to a Reuters analysis of corporate filings.
This is a fraction of the tax rate in the countries where Apple’s products are designed, made and sold. The low rate is achieved by Apple telling US authorities that the profits are earned by Irish units. Meanwhile, Apple and Ireland agree the profits are generated in the US.
Among elements revealed by the commission’s edited text was a record of a meeting between an Apple tax adviser and the Irish revenue service in 1990 in which they discussed setting an apparently arbitrary ceiling on the profit on which Apple’s Irish unit would be taxed locally.
A year after Apple’s Irish branch had recorded a net profit of US$270 million, its tax adviser proposed that no more than US$30 million to US$40 million a year be taxed in Ireland, since the rest was attributable to technology and marketing businesses elsewhere.
“[Apple’s tax adviser] confessed there was no scientific basis for the figure. However the figure was of such magnitude that he hoped it would be seen to be a bona fide proposal,” the excerpt cited in the commission judgment read.
The reference is part of the commission’s case that Ireland gave Apple special treatment to induce it to base its European operations in the country and channel profits through Ireland.
While independent tax experts scanned the documentation for more clues to Vestager’s overall approach, another element that stood out was its concern about the way Dublin did not set time limits on its rulings on how Apple’s income would be taxed. That could signal trouble for other multinationals facing Brussels’ ire, not just in Ireland but in several other EU countries.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
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