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Apple Now, Google, Amazon Next? Why EU Hates Successful U.S. Firms

EU Antitrust Commissioner Margrethe Vestager has become the point-person in the ongoing attack by the EU on successful U.S. companies like Apple, Google, Amazon and McDonald's. (AP)

Taxes: The European Union's laughably misnamed "competition commission" has slapped a $15 billion penalty on Apple for supposed back payments of taxes. This is nothing more than a cash grab by money-hunrgy Eurocrats, and is Exhibit A in why the EU is failing.

We'll spare you all the dry technicalities of Apple's case because, in fact, the EU is going after a whole slew of mainly U.S. companies that do business there — including Google, Amazon, Starbucks and McDonald's. The reasons in each instance are as varied as the companies themselves.

In Apple's case, the EU accuses it of dodging taxes by booking profits not where they're earned, but in Ireland, with which Apple signed a tax deal years ago and where its regional headquarters is.

As an example, the EU claims Apple paid 0.005% of its profits as taxes in 2014 — roughly equal to about $50 for every $1 million in profits. For the record, Ireland's corporate rate is 12.5%, about $125,000 per million.

So Ireland must be furious about being cheated out of so much tax revenue, right?

Wrong. The deal is this: Apple creates jobs, and Ireland keeps taxes low. Simply put, it's a great deal for any country that seeks economic growth — and has the common sense to pursue it.

In effect, the EU has gone back and retroactively rewritten tax law to suit its ideas of "fairness." It may also slap another $6 billion on Apple's bill for "interest" -- which is absurd, considering the EU's negative interest rates.

All this has enraged Apple, not known for throwing public tantrums.

"The European Commission has launched an effort to rewrite Apple's history in Europe, ignore Ireland's tax laws and upend the international tax system in the process," said Apple CEO Tim Cook.

"The Commission's case is not about how much Apple pays in taxes, it's about which government collects the money. Apple follows the law and pays all of the taxes we owe wherever we operate. We will appeal and we are confident the decision will be overturned."

The U.S. Treasury is likewise angry, accusing the EU of trying to turn itself into a global tax regulator — imposing taxes on U.S. companies it really has no jurisdiction over, in the name of "competition." To top it off, the EU decision comes just two days after a top German official pronounced free-trade talks between the U.S. and EU "dead."

Whether Apple wins its appeal is questionable. But either way, the EU almost certainly will lose as a result of this.

As we said, the EU these days goes after virtually every successful American company that operates in its territory. And it jealously punishes its own members within the 28-nation bloc that actually compete to make their economies better — which is exactly what Ireland did.

Europe has fewer and fewer innovative, champion companies these days, because of the massive amounts of regulation they face. So the EU's assault on highly successful U.S. businesses is in part out of envy — Apple iPhones are near ubiquitous across Europe. There is no real European alternative.

In going after these American champions that so improve European life, the EU routinely vilifies those it has targeted, treating them as if they were pirates — not job creators.

Yet, these corporate villains employ thousands of Europeans, and, yes, also pay taxes. But they never pay enough to satisfy the far-left Eurocracy that has spent the EU into near-bankruptcy.

Apple shows what happens when unelected bureaucrats have power to control businesses. In this instance, Margrethe Vestager, the grandly titled EU "competition commissioner," is an inveterate leftist politician from Denmark who has repeatedly gone after successful companies to shake money out of them.

This latest salvo will no doubt be greeted with huzzahs in the EU's headquarters in Brussels and Luxembourg. But it shouldn't be.

These attacks on successful, mostly U.S.-based companies will backfire horribly. The EU already struggles with high unemployment, low growth and lagging standards of living — but not because Apple isn't paying enough in taxes.

Apple employs 22,000 workers in Europe, out of a worldwide workforce of 370,000. And it supports another 257,000 or so jobs at other companies worldwide. Those are huge benefits to the economies they operate in.

Would chasing Apple and other winners from Europe serve any purpose?

Already, there is talk of companies rethinking their EU strategies. After Brexit, a more pro-business Britain could become a very attractive alternative to the EU's socialist planners. Heck, even strife-torn, authoritarian Turkey is rolling out a welcome mat to Apple.

The U.S. is little better. It taxes U.S. companies at an absurdly high 35%, when the average rate for other nations is below 25%. If the U.S. reformed its tax code, the $2 trillion or so stashed overseas in corporate accounts would come flooding back, creating thousands and thousands of jobs.

In the meantime, the EU has investigations going on just about every major successful U.S. company doing business there. But companies will only take so much abuse. Sadly, the EU's socialist-leaning rulers show no signs that they get it.

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