Wednesday 26 July 2017

US Treasury is owed the tax that Apple has avoided

'Bizarre' finding says the US animal is alive, Irish, worth €13bn and living in the basement of Apple's Cork HQ

Michael Noonan described the Commision's decision as 'bizarre' Photo: Tom Burke
Michael Noonan described the Commision's decision as 'bizarre' Photo: Tom Burke
Colm McCarthy

Colm McCarthy

In 1935 Albert Einstein and two co-authors published an article in an academic journal called the Physical Review about the problem of quantum superposition, the idea that a subatomic particle exists in a combination of several alternative states. The act of observation affects the particle making it select just one of these states. The Austrian physicist Erwin Schrodinger concocted a thought experiment to illustrate the point. A cat is enclosed in a lead box with a device which might or might not have released a fatal dose. When the box is opened, the cat will prove to be either dead or alive: prior to the act of observation it must be deemed both dead and alive simultaneously.

If you find subatomic physics hard to follow, stay away from international tax accounting. There has been a Schrodinger cat residing in the basement of Apple's Hollyhill headquarters in Cork since 1991. It is called Apple Sales International and is a very large animal indeed. It has few employees but has assets in the hundreds of billions.

Viewed from the headquarters of the US Internal Revenue Service in Washington it appears to be an Irish cat, free from US taxation until the billions get remitted to the Land of the Free. But viewed from the office of the Irish Revenue Commissioners it is (or was) a Bermudan cat, exempt from taxes in Ireland and happily there are none in Bermuda. The tax accountants had apparently been able to strip the beast of any nationality whatsoever and hence this particular very large unit of Apple of any liability to corporation taxes.

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