"Hey Siri" support and possibly wireless charging case alongside AirPower charging mat.
Apple Expects Appeal of Irish Tax Ruling to Take 'Several Years' With No Impact on Near-Term Financial Results
Following the European Commission's ruling that Apple received illegal state aid from Ireland, and must pay $14.5 billion in back taxes to the country, the company has published a new FAQ that addresses potential concerns investors may have about the decision and the effect on its bottom line.
Apple started out by confirming the decision is not final and that it plans to appeal. The company is "confident" the ruling "will be overturned" by courts in the European Union, but it notes the process is "likely to take several years." In the meantime, Apple does not expect any near-term impact on its financial results.
The European Commission's ruling followed a three-year inquiry into Apple's tax arrangements in Ireland, where it paid between 0.005% and 1% in taxes from 2003 through 2014, compared to the country's headline 12.5% corporate tax rate. Apple insists it "follows the law and pays all of the taxes" it owes.
Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.
Apple started out by confirming the decision is not final and that it plans to appeal. The company is "confident" the ruling "will be overturned" by courts in the European Union, but it notes the process is "likely to take several years." In the meantime, Apple does not expect any near-term impact on its financial results.
How does this decision impact Apple’s near-term financial results?Apple added that it does not currently expect the decision to have an impact on its tax rate or cash balance going forward, but the company anticipates it will place an unspecified amount of cash in an escrow account. Apple expects the amount will be reported as restricted cash on its balance sheet.
Will you take a tax charge? Does this alter your previous guidance?
We do not expect any near-term impact on our financial results nor a restatement of previous results from this decision. We have previously accrued U.S. taxes related to the income in question. The tax rate guidance for Apple’s fourth fiscal quarter that we provided on July 26, 2016 does not change as a result of this decision.
The European Commission's ruling followed a three-year inquiry into Apple's tax arrangements in Ireland, where it paid between 0.005% and 1% in taxes from 2003 through 2014, compared to the country's headline 12.5% corporate tax rate. Apple insists it "follows the law and pays all of the taxes" it owes.
Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.
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31 months ago
I don't understand EU tax law. It seems Ireland's own laws says what Apple is doing is legal.
It's not EU tax law, it's EU competition law.EU competition law forbids special deals that amount to state aid to companies.
The state aid happened to have taken the form of reduced taxes.
31 months ago
As I understand the money will have to be collected soon, along its interest which makes it a lot more, and then it sits in a fund that cannot be touched by Apple it Ireland or anyone else whilst they go through the appeals process.
Personally I think Apple firstly being almost fraudulent in its tax payments dodging, and then posting a letter to Europe claiming they are innocent and Ireland was nothing till they showed up, will have lost them some sales.
We shall see though. You don't bite the hand the feeds you which is EXACTLY what Tim Cook has done today by threatening any further EU investment now because of their tax dodging being exposed. That arrogant American attitude doesn't win over European consumers Tim.
Personally I think Apple firstly being almost fraudulent in its tax payments dodging, and then posting a letter to Europe claiming they are innocent and Ireland was nothing till they showed up, will have lost them some sales.
We shall see though. You don't bite the hand the feeds you which is EXACTLY what Tim Cook has done today by threatening any further EU investment now because of their tax dodging being exposed. That arrogant American attitude doesn't win over European consumers Tim.
31 months ago
I don't understand EU tax law. It seems Ireland's own laws say what Apple is doing is legal.
31 months ago
Except the EU itself is hardly popular in the EU itself right now, and it could also come across as "why the hell is the EU interfering in the tax laws of a member state? Shouldn't they have the right to do whatever they want? A lot of people feel the EU is interfering too much. So it could go either way really.
You have severely underestimated the attitudes of Europeans towards giant corporations, this is actually a good thing. The EU provides a hell of a lot better consumer laws then America does and no one is complaining about that!
31 months ago
Just curious... how much cash do they have stored in the bank again?
Let's put it this way, the tax demand is about 6% of their cash on hand. But they'll fight it tooth and nail for years, even if they'll have to spend those 6% on tax attorney fees.
31 months ago
Just curious... how much cash do they have stored in the bank again?
Apple held $231.5 billion in cash and marketable securities, partially offset by $68.9 billion in long-term debt, as of its Q3 2016 results reported on July 26.
31 months ago
Maybe Tim should update the computer products with that money? He could write it off as a R&D expense. Maybe we could have Macs with technology that is at least current (never mind the premium we pay on top of that because it's Apple made).
Also, no small business gets that benefit, we all are taxed at 35% on profit and also get eaten alive by incredible amounts of paperwork, record keeping, etc. I have zero sympathy. And what is also this social responsibility nonsense Tim is always spouting? I'd rather he just put faster chips in his machines that blathering on all the time - while paying himself 100 million in stock options.
All the more embarrassing for Tim that he can't even half-ass keep the Mac line updated when companies a fraction of a fraction of the size can keep their computers updated 1-2 times a year.
31 months ago
As I understand the money will have to be collected soon, along its interest which makes it a lot more, and then it sits in a fund that cannot be touched by Apple it Ireland or anyone else whilst they go through the appeals process.
Personally I think Apple firstly being almost fraudulent in its tax payments dodging, and then posting a letter to Europe claiming they are innocent and Ireland was nothing till they showed up, will have lost them some sales.
We shall see though. You don't bite the hand the feeds you which is EXACTLY what Tim Cook has done today by threatening any further EU investment now because of their tax dodging being exposed. That arrogant American attitude doesn't win over European consumers Tim.
1) Apple is creating an escrow account on their own to pay what they believe that they will end up owing, if they lose their appeal.
2) Apple paid what Ireland required of them. Ireland gave them tax breaks for the employment and other opportunities that Apple was bring to Ireland. This happens in US cities all of the time. The difference here is that Ireland, as a member of the EU, isn't allowed to do this (hence the UK desiring to leave the EU). The EU loves takes and doesn't believe in tax breaks for companies just because they provide other offsetting or potentially even more benefit to the community than the taxes would.
3) If I was given a tax break in return (officially or unofficially) for my bring jobs and other economic benefits to an area and was told later that the deal was off, you can bet I would second guess holding up my end of the deal. Apple has a lot of options as to where they conduct their operations - they don't have to be bring jobs, renewable energy development, etc. to the EU.
31 months ago
Maybe Tim should update the computer products with that money? He could write it off as a R&D expense. Maybe we could have Macs with technology that is at least current (never mind the premium we pay on top of that because it's Apple made).
Also, no small business gets that benefit, we all are taxed at 35% on profit and also get eaten alive by incredible amounts of paperwork, record keeping, etc. I have zero sympathy. And what is also this social responsibility nonsense Tim is always spouting? I'd rather he just put faster chips in his machines that blathering on all the time - while paying himself 100 million in stock options.
Also, no small business gets that benefit, we all are taxed at 35% on profit and also get eaten alive by incredible amounts of paperwork, record keeping, etc. I have zero sympathy. And what is also this social responsibility nonsense Tim is always spouting? I'd rather he just put faster chips in his machines that blathering on all the time - while paying himself 100 million in stock options.
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