Chip Bok's Bokbluster

Ireland has a 12.5% corporate tax rate. The US has a 39.5% rate.

So Apple moved its Intellectual Property operations to Ireland. And, due to a complicated 1990s agreement, the company doesn’t even pay the 12.5% rate. It’s more like .005%. (Apple did pay $3 billion in U.S. income taxes in the third quarter.) You can read how it works here, complete with a chart.

Ireland is happy with the arrangement. Apple has $200 billion parked there and employs lots of people.

EU Bite Of Apple

The U.S. is unhappy because it’s not able to take its full 39% bite out of Apple. The European Union is unhappy too.

So unhappy that it has ordered Ireland to collect $14 billion in taxes from Apple.

Now the U.S. is unhappy with the EU. The Treasury Department says the money grab damages U.S. – EU economic relations.