Tax

The Irish government has today launched an attack on the European Union’s order that it collect €13bn in back taxes from Apple. Ireland accuses the European Commission of misapplying State Aid law, and of attempting to re-write Irish corporation tax rules. In a document released by the Irish government’s Department of Finance, eight points are made about how the EU is overreaching its authority.

"The Commission has exceeded its powers and interfered with national tax sovereignty," the document reads. The document was submitted almost four months after the penalty was imposed against Apple which is also appealing.
Apple’s European headquarters are located in Ireland where the standard rate of corporate tax is 12.5%.

Multinational corporations rob developing countries of 100 billion dollars every year by using tax avoidance schemes, global charity Oxfam said in a report released Monday.

The charity said tax dodging by multinational corporations cost poor nations vital resources that would be enough to provide an education "for the 124 million children who aren’t in school and fund healthcare interventions that could prevent the deaths of at least 6 million children every year."

Called "Tax Battles: the dangerous race to the bottom on corporate tax," the full ranking of the world’s top offenders is: (1) Bermuda; (2) the Cayman Islands; (3) the Netherlands; (4) Switzerland; (5) Singapore; (6) Ireland; (7) Luxembourg; (8) Curaçao; (9) Hong Kong; (10) Cyprus; (11) Bahamas; (12) Jersey; (13) Barbados; (14) Mauritius; and (15) the British Virgin Islands.

McDonald’s Corp said on Thursday it would move its international tax base to the United Kingdom from Luxembourg after coming under increased scrutiny from European Union regulators over its tax arrangements in the small country.

McDonald’s said it would create a new international holding company domiciled in the UK that would receive the majority of royalties from licensing deals outside the United States.

The profits will be subject to British tax, McDonald’s said in a statement that was immediately welcomed by the British government, which is under pressure to preserve economic stability as the country prepares to leave the European Union.

Switzerland ranks 18th in the latest edition of PricewaterhouseCoopers’ (PwC) Paying Taxes global study, which looks at how easy it is for a standardised, medium-sized domestic company to pay its taxes.
A Swiss medium-sized company will pay 28,8% of its profits in taxes, substantially lower than the 40.3% average across the EU.

The study ranks 190 countries according to the levels of bureaucracy involved in paying and filing taxes, but also the amount of tax levied on companies.

Switzerland and Austria on November 11 signed an agreement to terminate their 2013 withholding tax agreement as of January 1, 2017. In the same day the agreement between Switzerland and the EU on the automatic exchange of tax information enters into force.

It governs the arrangements for transferring the final tax amounts and forwarding the last voluntary disclosures to the Austrian authorities. "The provisions of the withholding tax agreement will continue to apply for all facts and legal rights that materialized during its period of validity," the Swiss Federal Council said.

The European Commission has announced that it started to work on the first EU list of "non-cooperative tax jurisdictions." It is a first step in a complex process that involves consultation of individual European states. At the time a preliminary assessment of all third countries implemented based on a set of key indicators was presented, the Commission explained in a statement.

Reid Hoffman, co-founder of LinkedIn, has offered five million dollars to 10 veterans affairs group, if Donald Trump will make public the figures of his income tax return by the date of the final debate between the candidates for the US presidency.

The Hoffman offering ranks in support of Pete Kiernan, a veteran of the Marine Corps who has launched a crowdfunding campaign promising to allocate the money collected to active non-profit organizations in assisting veterans if Trump declare his earnings later, precisely on October 19. The goal is set at US $ 25.000; whether it will be achieved, Hoffman will quintuple the sum raised.