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News digest 02/09/16: Apple gets £11 billion 'sweetheart’ tax bill

02 September 2016 by Henry Ker

Apple gets £11 billion 'sweetheart’ tax bill - read more

The latest governance stories in the news

Apple gets £11 billion 'sweetheart’ tax bill

Apple has been ordered to pay a record £11.1 billion (€13 billion) in taxes by European Commission.

After a three-year investigation, the EU Competition Commissioner, Margrethe Vestager, ruled that Ireland granted Apple illegal tax benefits, known as a ‘sweetheart’ deal.

The deal with the Irish government allowed Apple to avoid taxation on almost all profits generated by sales of its products in the entire European market. They did this by recording all of the sales in Ireland rather than in the countries where the products were actually sold.

‘Member states cannot give tax benefits to selected companies − this is illegal under EU state aid rules,’ Ms Vestager said. It appears Apple had paid just 1% tax on its European profits in 2003 and 0.005% in 2014 due to the arrangement.

Apple CEO, Tim Cook, called the European Commission's decision ‘invalid’ and ‘crap’ and plans to appeal. Despite the Irish government being the beneficiary of this money, it has vowed to back Apple’s appeal, as the fear is the ruling will deter future investment in the country.

Mr Cook said Apple plans to repatriate most of its offshore profits to America next year.

 

Monsanto whistleblower points finger at Deloitte

A whistleblower, who was recently awarded $22 million for exposing accounting violations at Monsanto, has called for the Securities and Exchange Commission to look into the company’s auditor, Deloitte.

The law firm representing the whistleblower has said that its client wants to pressure the SEC to look at Deloitte’s role in Monsanto’s restatement of profits in October 2011.

The whistleblower was awarded the pay-out in relation to the accounting of a sales rebate programme for its weedkiller, Roundup – dubbed a ‘well-hidden fraud’ – after the SEC and Monsanto reached an $80m settlement six months ago.

 

Stop ‘shocking’ workplace discrimination of pregnant women

MPs have demanded urgent action over discrimination of pregnant UK women. The Women and Equalities Committee has called for protections similar to those in Germany, claiming a 'shocking' increase in workplace pregnancy discrimination over the past decade.

They have called on the Government to publish a ‘detailed plan’ within the two years or risk more pregnant women being forced out of their jobs. The recommendations include an increase in protection for casual, agency and zero-hours workers, changes to health and safety practices and preventing discriminatory redundancies.

Committee Chair Maria Miller commented ‘The Government's approach has lacked urgency and bite. It needs to set out a detailed plan outlining the specific actions it will take to tackle this unacceptable level of discrimination. This work must be underpinned by concrete targets and changes to laws and protections to increase compliance by employers to improve women's lives.’

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