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Thursday, 1 September 2016

Fraser Nelson’s Rotten Apple

Whatever its political stance, the Spectator has for decades won plaudits for the standard of its journalism, even when the editor’s chair was occupied by London’s formerly very occasional Mayor Alexander Boris de Pfeffel Johnson. But Fraser Nelson, the current incumbent, has abandoned such trivialities as factual accuracy in favour of being nothing more than contrarian - and this is not serving the magazine at all well.
Fraser Nelson - the clueless contrarian

After Apple suffered its recent setback over unpaid taxes in Ireland - it has been ordered to pay back £11 billion, or €13 billion, to the Irish Government, whether that Government wants it or not - Nelson penned a leader for his magazine titled “A Rotten Windfall”, based on an elementary misunderstanding of how corporation tax works, and how Apple is gaming the system, both in the EU, and especially in the USA.
Nelson duly advertised his (paywalled) article on Twitter, telling “The EU's Apple tax grab shows the wisdom of Brexit. Leader in the @spectator”, following that mere nugget of opinion with a dreadful howler in “Apple is paying full tax on its European profits - in the US where the business was nurtured and value created”. The whole point of the €13 billion bill is that Apple has done no such thing. It’s offshoring, and not repatriating, its profits.
Stuart Millar put Nelson straight: “Apple offshores profits more than any big US company. See here”. That link confirmed that the company had got away (until now) with paying almost nothing on profits it had booked in Ireland. “And here” added Millar, referring Nelson to an easily accessible report by Sky News.
It got worse: Millar then referred the Spectator’s editor to another easily accessible report, this time by the BBC, commenting “It was called ‘one of the largest tax avoiders in the US’ in a Senate report in 2013”. Luke Lewis also weighed in on Nelson’s claim that Apple was paying tax in the US, reminding him “But they're not paying tax there either. They're refusing to repatriate their profits”. Keeping the money offshore - again.
So how did the editor of the Spectator address this point? Conjecture, no more, no less: “didn't Apple pay about 33pc US tax on about $90bn of european profit last year?” Why does the author of a supposedly authoritative editorial have to ask? HE SHOULD KNOW. In any case, Alex Hawkes could answer that: “pretty sure Apple's 10K says they paid no US tax on $48bn of foreign profits in 2015. p55”.
Nelson is totally wrong on the amounts of profit and tax, not just on the jurisdiction where they are booked. Brodie Houlette corrected him with “Apple defers its taxes in the US with offshoring in the hope to get a tax amnesty and far less than that rate. Read NYTimes” (Ouch!), while Graham Terris said simply “So this cash pile they're refusing to repatriate? Piss-poor reporting and time to cancel my sub”. Quite.

This week’s Spectator has not yet hit the news stands, and already its editorial has been exposed as clueless claptrap. Why bother paying good money for that rubbish?

4 comments:

Anonymous said...

The Spectator used to be authoritative, well written and humorous. It now often reads like a rabid neocon fanzine, full of fact-free hatred from self-regarding bigots like Douglas Murray, James Delingpole and Toby Young.

Nelson is ignoring the Spectator's traditional readership - educated, reasonable, civilised - because he knows there are more hits in impressing a proliferating community of cowardly far-right keyboard racists. He should be ashamed of himself.

rob said...

And it has been pointed out that if and when Apple pay tax in Ireland then they will get credit for that off their US tax bill. But then they would probably have to pay tax in the US instead of sitting on an offshore csahpile that doesn't actually help anyone let alone their own shareholders.

Oscar James said...

Poor Fraser- he confidently predicted a year ago that Oz PM Malcolm Turnbull would go to an election soon (amazing insight when he had to within 18 months) and win with an increased majority.
Alas Turnbull's 35 seat majority was slashed to 1 with an unmanageable Upper House.

Man From Atlan said...

I used to love The Spectator (UK) in the 70's. Seemed then the best writing was written by conservatives (even when I disagreed with them). But neo-cons really, really lack the intellectual vigour I was used to.