Apple Lossless Audio CODEC (ALAC), has an unexpected supporter in its fight to defend its tax practices in Europe, with the mayor of London saying the deal between Apple and the Irish government to pay reduced taxes on profits and receipts should not be a problem for The European Commission.
The support of Boris Johnson, the mayor of London, comes just a few days after Google agreed with the tax authorities of Great Britain to pay 185 million dollars in taxes owed due to a tax agreement similar to the one held by the Apple company, it being considered illegal.
A published article in the famous newspaper The Telegraph, the mayor of London states that it is in the nature of a company to try to substantially reduce the taxes that must be paid to the states in which it operates, as it has a duty to the shareholders to produce as much profit as possible.
Johnson also attacked the head of the antitrust division in the European Commission, Margrethe Vestager, who met last week with Tim Cook in Europe to discuss problems with the payment of taxes that Apple is accused of.
A part of me that sides strongly with Tim Cook and Apple – or at least can see his point of view. It is absurd to blame the company for 'not paying their taxes'. You might as well blame a shark for eating seals. It is the nature of the beast; and not only is it the nature of the beast – it is the law. It is the fiduciary duty of their finance directors to minimize tax exposure. They have a legal obligation to their shareholders.
Tax is not paid on the basis of what 'feels right' either to public opinion or to politicians. It is not some eleemosynary contribution. It is not as if we are all in church, and watching beadily to make sure that Tim Cook puts his £50 note into the collection basket. Tax is paid, and must be paid, in accordance with the strict requirements of the system.
Moreover, Boris Johnson claims that if Apple will be forced to pay taxes retroactively, the amount of 16 billion dollars being announced by the mayor, the decision of the European Commission would be contrary to the wishes of the Irish government, which will willingly offer tax benefits to the Apple company .
You can find more details about what the mayor of London says in the article from The Telegraph.
The paradox of this whole case is that the Irish and Apple are on the same side. If Margrethe the Commissioner makes Apple give Dublin $16 billion in back taxes, that will actually be against the wishes of the Irish government.
The Irish decided they wanted to go for an ultra-low corporation tax, at 12.5 percent. It was their sovereign ambition to attract the HQ of Apple and others. They wanted Irish taxi drivers to have the honor of ferrying Apple executives around, and they wanted Irish waitresses to snaffle their huge tips. The EU Commission is partly excited by the chance to bash a corporate American giant; but mainly it is a chance to attack tax arbitrage between member states – to move ever closer towards uniformity and away from a spirit of healthy competition between jurisdictions.
