That's throwing the baby out with the bath water. Apple has a legitimate need for a subsidiary in countries they operate. What needs to stop is the shenanigans around revenue & costs designed solely to generate profit in low tax countries.

Both Ireland and Luxembourg have legitimate activities: Irish whiskey isn’t a big deal compared to tech, but there’s no real reason to ban it. Defining a line is hard, especially when the country’s traditional advantage _is_ finance, like it is in Luxembourg, even outside of tax-optimisation.

It’s easier to have rules against countries with less credibility, but then again, you risk making things complicated for Seychelles, Curaçao, St-Martins. It’s easier to define a minimum tax so that they don’t have to pick between tourism and tax optimisation.

Maybe an import duty needs to be applied. Importing the Irish whiskey will incur a duty. Google US paying a 100% license to Google Ireland should also incur a duty charge for importing the license from Ireland.

Something like that, anyway.

Yes! Exactly this.

Except the reason it's not done today is because back in the 90s, people argued that it's not possible to tell if/when services/IP crossed borders because there's no fixed port of entry.

(They were making this argument because software CDs were subject to import duties but downloads were not and that they were unfair)

Today it's still the case and services/IT are not subject to duties.. but I think large licensing agreements like this should definitely attract import duties

The solution is simple enough: look at the companies books, if money is leaving the country, duty is charged unless it can be accounted for by something else (like the existing duty on physical goods).

IRS: Hey Google, you said you made this much money, so you owe us tax.

Google: No, see, here we paid it to Google Ireland as IP license fees, so we in fact made $0

IRS: Great, you owe us duty on that payment

All rise, court is now in session. The honorable Lina Khan presiding. The case of U.S. vs. 10 Billion Wrapped Individually Marked Bills.

> Both Ireland and Luxembourg have legitimate activities:

So those countries need to decide if they want to support legitimate activities or legitimate activities with fair tax policy approved by the US.

If they dont like US's demands they can stop trading with US but we know they are not going to do that.

In that case the US should first handle Delaware before throwing the first stone.

Yes they should but they are probably not going to do anything.

The fact that they could levy such inducements and everybody knows it is probably why this deal is happening.

Tax havens require the complicity of larger, more powerful states to exist. They are by no means inevitable.

Because that would lead to a trade war?

Do you really think countries like Ireland, Liechtenstein can afford to piss of US. US has the leverage here, it should use it.