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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 10:11 am 
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Eschatologist wrote:
jmc wrote:
Eschatologist wrote:
jmc wrote:
Ireland today has no meaningful economy apart from the MNC tax visitors and the economic activity due to government expenditure based mostly on borrowing against a grossly inflated gnp/gdp numbers, due to the MNC economic activity.

The forecast deficit for 2017 is 0.4 per cent of GDP. In absolute terms it's still a small number, around 1 billion euros, against voted expenditure of 56bn or whatever. So "government expenditure based mostly on borrowing" makes no sense.


The fact that you use GDP means you dont understand any of the numbers. The current GDP/GNP difference is between 20%/25%. Depending on how you slice and dice. In real economies its about 1%/2% max. GNP is what is left after the MNC have moved their loot onwards to the next location. Which is where you should really start when it comes to sovereign debt ratios.

And anyway, since the CSO moved to Eurostat methodologies the official GDP numbers have became completely meaningless. Because such a large element of the Irish economy is little move than massive MNC cash inflows / outflows. Hence "Leprechaun economics" and 26% "growth" in y-on-y GDP..

When I looked at the last real numbers, not estimates, after the gov paid the national debt roll over costs they were still spending about 10B more than they brought in. Given that there are some very interesting national debt balloon payments coming due the next few years that number will not be going down anytime soon. The 7B p.a will be going quite a bit higher. Especially after the ECB stop buying the sovereign debt. Which is what they have been doing since 2012.

Ignoring all the usual smug ad hominems, I would be genuinely interested to see figures that support your assertion that the government spends 10B more than they bring in.

I'm not interested in GDP/GNP arguments, everyone knows those numbers are nonsense. That clearly wasn't the point I was referring to.


No ad-hominems.. just anyone who quotes GDP numbers in an Irish context automatically invalidates whatever follows. Over the last 2 decades all Irish government expenditures estimates have been wrong. Not just a little wrong. But very wrong. We are talking ERSI wrong. What is more interesting is the final expenditure numbers which trickle out a few years later. The last real numbers I looked at were 2015. The final real 2016 numbers wont be out for a while. Or as real as it gets with government account practices..

The last time I looked, a few months ago, after you had unraveled the whole voted / unvoted / other expenditure numbers and first subtracted the cost of servicing the national debt (interesting on its own due to defacto gov ownership of the banks that are first "buyers" of a reasonable chunk of the roll-over debt) you end up with, in round figures 50B in and 60B out. In the end all that matters is how much tax / income comes in and how much cash or cash equivalents goes out. I see it as no different to reading the 10K annual accounts of a dot com that is doing a lot of EBITA hand waving. Think Uber or Tesla. Ignore the hand waving, follow the cash. Because the cash flows will tell you the long term story. Which is always bad in all cases of accounting hand waving.

It was exactly the same back in the 1980's. The gov were spending more than they were taking in and the CB and kiddies in Dept of Finance were pissing around in circles for over a decade until they stopped fucking about, set up the NTMA, and brought in some professionals to run the show. Expenditure was reined in, the debt was professionally managed, and within a few years the debt started going down and economy was back on an even keel again.

So why not cut back gov expenditure to match income? Most of the excess expenditure is due to bubble era inflation of wage bills and payments. People were not exactly starving on the pre-bubble level wages and payments. Its not just the political outcry from all the usual suspect that prevents this. As Joan Burton blurted out soon after she saw the real books - without all this extra government expenditure the general consumption economy would collapse. Greek levels of contraction. Because thats what happens when you have a tax haven economy and not much of a wider economy. Gov expenditure has a disproportionate effect on the general consumption economy.

So as you walk around the Grand Canal Basin and the IFSC what you see is a reasonable chunk of the Irish GDP. What you dont see is a well rounded, deeply based, foundation of a national economy. Think of it as purely hot-desked GDP. Which is all it is, really.


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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 10:13 am 
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jmc wrote:
The *only* reason Treasury in M.V would give the go-ahead to buying local real-estate etc (fixed assets) is because there was a very good tax angle. No other. Otherwise if they wanted to buy real-estate (unlikely) it would be R.E.I.T.ed through a holding shell and then repo'ed if they wanted to keep it a nice liquid balance. But these guys have much better ways of holding their cash balances.

no need to create an artificial holding shell when you are a holding shell already surely?

more likely they've just gotten tired of dealing with the locals..


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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 10:21 am 
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NorvilleBarnes wrote:
jmc wrote:
The *only* reason Treasury in M.V would give the go-ahead to buying local real-estate etc (fixed assets) is because there was a very good tax angle. No other. Otherwise if they wanted to buy real-estate (unlikely) it would be R.E.I.T.ed through a holding shell and then repo'ed if they wanted to keep it a nice liquid balance. But these guys have much better ways of holding their cash balances.

no need to create an artificial holding shell when you are a holding shell already surely?

more likely they've just gotten tired of dealing with the locals..


They will have hundreds / thousands of shell companies. Most are single purpose vehicles. It makes the accounts a lot "simpler". Back in the day of 50% plus corp tax rates in Ireland pretty much every non-manufacturing company beyond a few employees was little more than a large collection of shell companies that traded among themselves. Thats how you got your tax rates down to levels that would not put you out of business very quickly. So nothing new here.

Plus the Googles of the world will be well used to dealing with world class property sharks. Who would leave the Irish sub-species in the tuppenny-ha’penny seats when it comes to mobius strip corkscrew business practices.


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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 10:41 am 
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jmc wrote:
Plus the Googles of the world will be well used to dealing with world class property sharks. Who would leave the Irish sub-species in the tuppenny-ha’penny seats when it comes to mobius strip corkscrew business practices.

i doubt they ever needed to bring their a-game, but sometimes dealing with stupid can be just as wearying.


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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 11:29 am 
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jmc wrote:
The last time I looked, a few months ago, after you had unraveled the whole voted / unvoted / other expenditure numbers and first subtracted the cost of servicing the national debt (interesting on its own due to defacto gov ownership of the banks that are first "buyers" of a reasonable chunk of the roll-over debt) you end up with, in round figures 50B in and 60B out. In the end all that matters is how much tax / income comes in and how much cash or cash equivalents goes out

As I understand it, the "general government balance" includes debt servicing costs but also includes temporary and one-off measures.

According to the NTMA, the most recent non-forecasted GGB was -4.8bn in 2015.

The forecasts are:
2016: -2.4
2017: -1.2
2018: -0.9
2019: 0.5

Source: http://www.ntma.ie/business-areas/fundi ... ndicators/

The NTMA recognises and draws attention to the GDP distortions, for instance here:

http://www.ntma.ie/business-areas/fundi ... h-economy/
"Given the presence of such large distortions, GDP and GNP have little information content in regards to Ireland’s economic activity."

There's no conspiracy or cover up here.

Anyway, you can choose to ignore the forecasts if you want, but your 10bn deficit estimate is way off, even for 2015, and that's nothing to do with GDP distortions.

If the govt succeeds in bring it down to around 1.2bn at end 2017, that's not a big number.

In 2016 the govt took €47.86bn in taxes, of which €7.35 bn was corp tax, 80% of which was from foreign firms.

So the 2017 deficit will be under 3% of the 42bn tax take excluding corp. tax from foreign firms.

If all of that foreign corp. tax goes, the deficit will rise to 7bn, or 17% of the tax take. That would be bad.

However, by way of comparison, the US takes in 3.3tn in taxes against $3.9 tn of expenditure, which is shortfall of 18%. And Trump is looking to cut taxes.

So judged purely on deficits as a proportion of tax take, Ireland without foreign firms' corp tax will still be in a marginally better position than the US before Trump does his thing.

And yes, I know the US prints its own currency.

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 3:18 pm 
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Revenue’s Annual Report 2016 is out

http://www.revenue.ie/en/about/publicat ... ports.html


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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 4:03 pm 
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Eschatologist wrote:
In 2016 the govt took €47.86bn in taxes, of which €7.35 bn was corp tax, 80% of which was from foreign firms.

TheJackal wrote:
Revenue’s Annual Report 2016 is out

http://www.revenue.ie/en/about/publicat ... ports.html

OK, so according to "Account of the Receipt of Revenue of the State collected by the Revenue Commissioners in the year ended 31 December 2016 (PDF, 4.78MB)"
http://www.revenue.ie/en/about/publicat ... t-2016.pdf

Total Net Receipts of Revenue Collected: 58.6bn
...which includes 10.7bn Receipts collected on behalf of other Departments/Agencies/EU Member States, most of which is PRSI and Health Levy (9.6bn) and Health Insurance Levy (640m).

I don't really understand "gross cumulative voted spending", but the projection for 2017 is 58bn, which suggests that the budget is more or less balanced at the moment.

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Fri Apr 28, 2017 6:18 pm 
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Let's keep it that way


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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Wed Oct 04, 2017 11:07 am 
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Quote:
The European Commission said today it was taking Ireland to the European Court of Justice for its failure to recover up to €13 billion of tax due from Apple.

The commission ordered the US tech giant in August 2016 to pay the unpaid taxes as it ruled the firm had received illegal state aid.

The case was one of a number of deals the EU has targeted between multinationals and usually smaller EU states.

"More than one year after the Commission adopted this decision, Ireland has still not recovered the money, also not in part," EU Competition Commissioner Margrethe Vestager said in a statement.


https://www.rte.ie/news/business/2017/1 ... ommission/

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Wed Oct 04, 2017 11:18 am 
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Dubhgeannain wrote:
Quote:
The European Commission said today it was taking Ireland to the European Court of Justice for its failure to recover up to €13 billion of tax due from Apple.

The commission ordered the US tech giant in August 2016 to pay the unpaid taxes as it ruled the firm had received illegal state aid.

The case was one of a number of deals the EU has targeted between multinationals and usually smaller EU states.

"More than one year after the Commission adopted this decision, Ireland has still not recovered the money, also not in part," EU Competition Commissioner Margrethe Vestager said in a statement.


https://www.rte.ie/news/business/2017/1 ... ommission/


Didn't we get certain guarantees before we went and voted for the Lisbon treaty second time round?

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Wed Oct 04, 2017 11:44 am 
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Mossy_Heneberry wrote:
Dubhgeannain wrote:
Quote:
The European Commission said today it was taking Ireland to the European Court of Justice for its failure to recover up to €13 billion of tax due from Apple.

The commission ordered the US tech giant in August 2016 to pay the unpaid taxes as it ruled the firm had received illegal state aid.

The case was one of a number of deals the EU has targeted between multinationals and usually smaller EU states.

"More than one year after the Commission adopted this decision, Ireland has still not recovered the money, also not in part," EU Competition Commissioner Margrethe Vestager said in a statement.


https://www.rte.ie/news/business/2017/1 ... ommission/


Didn't we get certain guarantees before we went and voted for the Lisbon treaty second time round?


Yes, cast iron assurances :x

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Wed Oct 04, 2017 11:52 am 
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NegativeEquity wrote:
Mossy_Heneberry wrote:
Dubhgeannain wrote:
Quote:
The European Commission said today it was taking Ireland to the European Court of Justice for its failure to recover up to €13 billion of tax due from Apple.

The commission ordered the US tech giant in August 2016 to pay the unpaid taxes as it ruled the firm had received illegal state aid.

The case was one of a number of deals the EU has targeted between multinationals and usually smaller EU states.

"More than one year after the Commission adopted this decision, Ireland has still not recovered the money, also not in part," EU Competition Commissioner Margrethe Vestager said in a statement.


https://www.rte.ie/news/business/2017/1 ... ommission/


Didn't we get certain guarantees before we went and voted for the Lisbon treaty second time round?


Yes, cast iron assurances :x


For clarity I'm not totally clear here on the above implication. Are you implying the Irish Gov agreed to bend the rules as only they know how to run the 2nd referendum once EU agreed to ignore any of these historical Apple-type deals with an array of US multi-nationals.

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Wed Oct 04, 2017 12:24 pm 
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NegativeEquity wrote:
Mossy_Heneberry wrote:
Dubhgeannain wrote:
Quote:
The European Commission said today it was taking Ireland to the European Court of Justice for its failure to recover up to €13 billion of tax due from Apple.

The commission ordered the US tech giant in August 2016 to pay the unpaid taxes as it ruled the firm had received illegal state aid.

The case was one of a number of deals the EU has targeted between multinationals and usually smaller EU states.

"More than one year after the Commission adopted this decision, Ireland has still not recovered the money, also not in part," EU Competition Commissioner Margrethe Vestager said in a statement.


https://www.rte.ie/news/business/2017/1 ... ommission/


Didn't we get certain guarantees before we went and voted for the Lisbon treaty second time round?


Yes, cast iron assurances :x


What "guarantees" do you think are being breached here?

that the Irish Government could do sweetheart deals below the actual legal tax rate?

If the Irish Gov/Dinny's mate in Revenue did a side deal to tax Denis O'Brien's businesses at a special secret rate do you think that would be OK?

Businesses are entitled to a level playing field - your competitors getting a special lower rate (computed using a unique method) is not that


Last edited by slasher on Wed Oct 04, 2017 12:28 pm, edited 2 times in total.

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Wed Oct 04, 2017 12:24 pm 
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Open Window wrote:

For clarity I'm not totally clear here on the above implication. Are you implying the Irish Gov agreed to bend the rules as only they know how to run the 2nd referendum once EU agreed to ignore any of these historical Apple-type deals with an array of US multi-nationals.


No, I was implying that the Irish Gov said whatever it took to get the referendum passed.

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 Post subject: Re: Apple, Ireland, EU, Tax Avoidance, Margrethe Vestager, C
PostPosted: Tue Dec 12, 2017 4:11 pm 
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https://www.politico.eu/article/faceboo ... id-wehner/

Quote:
Facebook to overhaul how it pays tax worldwide
The social network now funnels all of its non-US revenue through its international headquarters in Ireland.
By MARK SCOTT 12/12/17, 4:01 PM CET Updated 12/12/17, 4:03 PM CET
Facebook said Tuesday that it will change how it pays tax on its global operations, in a move that may result in the social networking giant contributing more to national budgets across Europe and farther afield.

The announcement comes as policymakers push digital companies — many of which have set up shop in low-tax countries like Ireland and Luxembourg — to be more transparent about where they pay corporate tax.

EU lawmakers also are considering new rules to force big tech companies such as Facebook and Google to pay more into national coffers amid claims that these tech giants sidestep domestic tax rules despite generating billions of euros annually from citizens across Europe and elsewhere.

As part of its proposed changes, which will take effect starting early next year, Facebook said profits from the majority of its advertising revenue generated in countries where the company has a sales office will now be taxed locally. The social network currently funnels all of its non-U.S. revenue through its international headquarters in Ireland.

“We believe that moving to a local selling structure will provide more transparency to governments and policymakers around the world,” David Wehner, Facebook’s chief financial officer, said in a blog post Tuesday.


Quote:
Moving to a Local Selling Model
By Dave Wehner, Chief Financial Officer

Today we are announcing that Facebook has decided to move to a local selling structure in countries where we have an office to support sales to local advertisers. In simple terms, this means that advertising revenue supported by our local teams will no longer be recorded by our international headquarters in Dublin, but will instead be recorded by our local company in that country.

We believe that moving to a local selling structure will provide more transparency to governments and policy makers around the world who have called for greater visibility over the revenue associated with locally supported sales in their countries.

It is our expectation that we will make this change in countries where we have a local office supporting advertisers in that country. That said, each country is unique, and we want to make sure we get this change right. This is a large undertaking that will require significant resources to implement around the world. We will roll out new systems and invoicing as quickly as possible to ensure a seamless transition to our new structure. We plan to implement this change throughout 2018, with the goal of completing all offices by the first half of 2019.

Our headquarters in Menlo Park, California, will continue to be our US headquarters and our offices in Dublin will continue to be the site of our international headquarters.


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