EU - Apple Wins Major Tax Battle

Arno Froese

Apple Inc. won a major battle with the European Union when the bloc’s second-highest court sided with the U.S. company over a €13 billion ($14.8 billion) tax bill that EU antitrust officials had said the company owed to Ireland.

The decision was a rebuke to Margrethe Vestager, who is leading the charge at the European Commission to rein in alleged abuses by big tech companies including Apple, Alphabet Inc.’s Google, and Inc. 

But [this] setback may at the same time embolden Ms. Vestager and other EU leaders in their push to create new regulations for tech companies, because they already argue that existing rules are insufficient to bring big tech companies to heel in areas ranging from competition to taxes. 

The overturning of the Apple decision comes at a sensitive time in the battle over how much tax big tech companies should pay—and where they should pay it. European countries and the U.S. are at an impasse in international talks on the topic, with Europeans pushing for rules that would make tech companies pay more levies where their customers are based, and Americans rejecting a system that doesn’t apply to all companies. 

A central issue in the Apple case was whether two Irish tax rulings granted to Apple in 1991 and 2007 gave a form of special treatment to the company, or whether they just reiterated an interpretation of Irish tax law as it was applied more generally. 

Those rulings allowed two Irish-registered Apple units to attribute only a small sliver of some $130 billion in profit to Ireland in an 11-year period. The commission said all that revenue should be attributed to Ireland, but the Irish government and Apple say they split the profit reasonably, given that almost all of Apple’s intellectual property is developed in the U.S., not Ireland. 

“On the issue of corporate taxation, this [Apple tax] ruling probably makes it more urgent and more clear, the need for corporate tax reform,” said commission vice president in charge of economic affairs, Valdis Dombrovskis. “That will be something the commission will come forward [with] in our autumn package,” he said., 15 July 2020

Arno's commentary

The answer to this conflict is almost too simple: global law. That is a given. Although much has been written about international (global) law, a real enforcement mechanism barely exists. Progress toward more globalization is something no one can stop. The world must become one. Borders, tariffs, permits, and visas are likely to be eliminated in the not-too-distant future. They will be replaced with a global registration system; thus, the new elite can travel freely globally without any restrictions. 

The Bible makes it clear that the Gentile world, regardless of political philosophy or religious adherence, will become one in opposition to one country: namely, Israel, and the city of Jerusalem in particular. But Zechariah 12:6 declares: “In that day will I make the governors of Judah like an hearth of fire among the wood, and like a torch of fire in a sheaf; and they shall devour all the people round about, on the right hand and on the left: and Jerusalem shall be inhabited again in her own place, even in Jerusalem.”

Arno Froese is the executive director of Midnight Call Ministries and editor-in-chief of the acclaimed prophetic magazines Midnight Call and News From Israel. He has authored a number of well-received books, and has sponsored many prophecy conferences in the U.S., Canada, and Israel. His extensive travels have contributed to his keen insight into Bible prophecy, as he sees it from an international perspective.

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