EU To Battle It Out In Court With Ireland For Failing To Collect Billions From Apple
The European Commission announced Wednesday it will be taking Ireland to court due to the country’s failure to collect roughly 13 billion euros ($15.3 billion USD) from Apple.
“More than one year after the Commission adopted this decision, Ireland has still not recovered the money,” European Union Competition Commissioner Margrethe Vestager said, according to Reuters, adding that the capital Dublin hasn’t even sought a portion of the total. “We of course understand that recovery in certain cases may be more complex than in others, and we are always ready to assist. But member states need to make sufficient progress to restore competition.”
The EU originally issued Apple a $14.5 billion bill in August of last year for securing an allegedly illicit deal with Ireland and avoiding nearly all corporate taxes for more than a decade. The sum is the largest ever charged to a company by the EU, according to The Wall Street Journal.
Vestager said in a press conference at the time that “the Commission’s investigation concluded that Ireland granted illegal tax benefits to Apple, which enabled it to pay substantially less tax than other businesses over many years. In fact, this selective treatment allowed Apple to pay an effective corporate tax rate of 1 per cent on its European profits in 2003 down to 0.005 per cent in 2014.“
Ireland, in response, defended its decision and corporate tax rate. Then-Irish Finance Minister Michael Noonan told the press “I disagree profoundly with the Commission’s decision,” reports The Wall Street Journal, and added that the country intends “to defend the integrity of our tax system.”
Just like a year ago, Ireland is still defending itself from EU’s accusations that its dragging its feet, or altogether refusing. It says it never accepted the Commission’s financial analysis of the situation, but nevertheless will retrieve the money from Apple once the nation’s appeal of the order is complete.
“It is extremely regrettable that the Commission has taken this action, especially in relation to a case with such a large scale recovery amount,” Ireland’s finance ministry said in a statement, according to Reuters.
Apple is also appealing the decision.
Apple isn’t the only U.S. tech company targeted by European governing bodies. (RELATED: Google Is Lawyering Up In Europe After Record Fines)
Recent reports show that the EU is expected to levy a massive fine against Amazon soon for allegedly evading the appropriate amount of tax payments by using Luxembourg for certain tax filing purposes.
“We are not the global tax collector for everybody else,” said Irish Finance Minister Paschal Donohoe in respect to Amazon. “We must be very careful not to endanger our reputation as advocates for free trade.”
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