The European Union is ordering Apple (NASDAQ:AAPL) to pay $14.5 billion in back taxes that it claims the tech giant didn’t pay due to illegal deals with Ireland. Steve Hilton, former strategy director for David Cameron, weighed in on why this was a factor behind Britain’s decision to leave the EU. Will Brexit, its anti-establishment sentiment, as well as its opposition to EU taxes and regulations draw comparisons to Donald Trump’s campaign in the 2016 presidential race?
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On whether Britain should continue to put out the welcome mat for multinational companies such as Apple and Google (NASDAQ:GOOGL), Hilton responded, “Definitely, this is what Brexit was all about. And I think that what this shows really is it’s a great advertisement not just for Brexit, but exactly as you were saying, for Donald Trump as well.”
Hilton viewed Apple’s deals with Ireland as completely legal despite the EU’s efforts to get more money out of the company.
“I think that what’s going on here is that Apple and Ireland were doing something completely within the law. Ireland was trying to attract business to its shores to create jobs and investment and of course the European Union centralizing bureaucracy hates that because they want every European country to be equally unattractive to business. And so they want more taxes and more regulation everywhere, equally spreading the pain. And if one country tries to compete, they don’t want that to happen,” Hilton told the FOX Business Network’s Stuart Varney.
Hilton viewed this major factor behind the campaign leading up to the Brexit vote.
“That’s a great reason for leaving the EU and one of the main arguments in the Brexit campaign.”
Hilton took on the U.S. tax code that drove Apple to make the deals with Ireland in the first place.
“The whole reason that Apple is even in Ireland doing these quite complicated tax arrangements is because of the insanely high corporate tax here in the U.S. and other countries are doing it as well. What that had led to, trillions of dollars overseas, money that could being invested here in the American economy to create jobs here. But because the taxes are so high that doesn’t happen.”
Hilton pondered the implications of the Brexit vote and Apple’s deals with Ireland for the U.S. presidential race.
“Now what Trump is saying is he is going to do a one-off tax cut to bring that money back and also more generally to cut business taxes to create jobs and investment. Now that is a really powerful argument in this year’s election here.”
Hilton then went into further detail on Trump’s tax plan which includes reducing the corporate tax rate from 35% to 15%.
“He’s 15% generally but he’s also proposing I think a one-off cut to tack that overseas money as a once-off charge, I think even lower than 15% and the argument is, well that sounds pretty low, but 10% of whatever it is, I can’t quite remember, 10% of trillions is a lot more than 35% of zero which is what’s going on at the moment.”