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"No provision of this Constitution invalidates laws enacted, acts done or measures adopted by the State which are necessitated by the obligations of membership of the European Union or of the Communities, or prevents laws enacted, acts done or measures adopted by the European Union or by the Communities or by institutions thereof, or by bodies competent under the Treaties establishing the Communities, from having the force of law in the State."
Article 107 of lisbon.
(ex Article 87 TEC)
(b) aid to make good the damage caused by natural disasters or exceptional occurrences;
(c) aid granted to the economy of certain areas of the Federal Republic of Germany affected by the division of Germany, in so far as such aid is required in order to compensate for the economic disadvantages caused by that division. Five years after the entry into force of the Treaty of Lisbon, the Council, acting on a proposal from the Commission, may adopt a decision repealing this point.
3. The following may be considered to be compatible with the internal market:
(a) aid to promote the economic development of areas where the standard of living is abnormally low or where there is serious underemployment, and of the regions referred to in Article 349, in view of their structural, economic and social situation;
(b) aid to promote the execution of an important project of common European interest or to remedy a serious disturbance in the economy of a Member State;
(c) aid to facilitate the development of certain economic activities or of certain economic areas, where such aid does not adversely affect trading conditions to an extent contrary to the common interest;
(d) aid to promote culture and heritage conservation where such aid does not affect trading conditions and competition in the Union to an extent that is contrary to the common interest;
(e) such other categories of aid as may be specified by decision of the Council on a proposal from the Commission.
Lisbon post dates the deal apple made, but the relevant rules did not change substantially with the changeover of treaties.
I don't agree with it, and am glad Noonan abolished that provision last year. But that does not give Vestager the power to make that abolition retro-active for 20 odd years. She has no powers in relation to corporate taxation whatsoever.
The 13 Billion tax bill relates to profits made on international sales, not its Irish operations. Since becoming tax resident in Ireland last year, Apple is now paying Irish corporation tax on those profits.
There is a valid case for arguing that those profits should be taxed in the markets where the sales took place, but that is not the basis for her finding. In fact she is arguing that Ireland should collect that tax, and if necessary, come to an arrangement with those countries where the sales took place.
None of this has any basis in any of the Treaties or is in any way within her sphere of competence. It may make her and the Commission look good in Europe - kicking around a weak government in a smaller member state. It is also the fastest way of promoting an Ire-exit movement in Ireland I can think of and embodies all the stereotypes of "unelected Brussels Bureaucrats" dictating policy to sovereign states so beloved of the Brexiteers.
Index of Frank's Diaries
The billions in profits which they have accrued on their European operations in previous years, hitherto untaxed, apparently is considered to generate a US tax liability (presumably because that money is owed to the US parent company, in the form of royalties or whatever).
So there seems to be an ambiguity about where these profits should be taxed.
The fact that Ireland previously let them get away with paying no tax on their European profits, and that the EU let Ireland get away with that, was a tacit subsidy accorded to Ireland when it was struggling to emerge from an Upper Neolithic economic status. But Ireland has one of the highest per capita incomes in the EU, and there is no longer any reason to continue the subsidy. Is there a danger that Apple will shift their operations out of Ireland? Where to? They need a base in the EU... Bulgaria perhaps? I think not.
None of this speaks to the legal position of course, and the Commission seems likely to lose; I don't think it matters much to them. I suspect them of doing this in order to mobilize public opinion in favour of severe constraints on transnational tax avoidance, and perhaps even standardising company tax rates.
In which case, I wish them all success, and indeed they have already achieved a great deal in that direction.
It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II
I very strongly recommend reading it. Well written, very persuasive.
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