Saturday

17th Apr 2021

Apple faces massive Irish tax bill

  • The US treasury threatened retaliation if the EU forces Apple to pay back taxes. (Photo: Jon Rawlinson)

The European Commission is expected on Tuesday (30 August) to order US tech giant Apple to pay back billions of euros to Ireland, two years after tax decisions taken in Dublin were deemed illegal state aid.

The commission will present a formula with which the Irish government will calculate the amount of taxes to be paid by Apple. Some analysts say the bill could reach €19 billion.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

In 2014, the commission said the tax arrangements between Ireland and the firm constituted illegal state subsidy.

"There is no indication that the contested measure can be considered compatible with the internal market," the EU executive said in a letter to the Irish government.

The case against Apple was opened in June 2014 over two tax rulings handed by Irish authorities in 1991 and 2007 that allowed the US firm to pay 2 percent tax on the profits made by two of its subsidiaries, instead of the official 12.5 percent corporate tax.

The scheme, the commission said, was "reverse engineered" so that Apple would pay less.

Last year the commission already ordered carmaker Fiat and coffee chain Starbucks to repay between €20 and €30 billion to Luxembourg and Netherlands in the same ground.

The forthcoming ruling, to be announced by EU competition commissioner Margrethe Vestager, will embarrass the Irish government. It has said it will fight the decision, which will amount to a refusal to accept a large sum of money.

The commission is "making up new rules for international tax”, an unnamed Irish minister was quoted as saying by the Irish Times.

“They are trying to make us tax Apple for stuff that doesn’t happen here. It’s nonsense.”

The ruling is also likely to irritate the US administration, which last week strongly criticised the commission's policies on state aids and tax rulings.

The US treasury said in a report: “The commission is charting a course that sets aside years of multilateral efforts.”

The department said it would "consider potential responses should the commission continue its present course".

News in Brief

  1. EU postpones decision on labelling gas 'sustainable'
  2. MEPs call for mass surveillance ban in EU public spaces
  3. Greek and Turkish ministers trade jibes in Ankara
  4. Biden repeats opposition to Russia-Germany pipeline
  5. Navalny in danger, letter warns EU foreign ministers
  6. Lithuania keen to use Denmark's AstraZeneca vaccines
  7. Gas plants largest source of power-sector emissions
  8. Study: Higher risk of blood clots from Covid than vaccines

Vietnam jails journalist critical of EU trade deal

A journalist who had demanded the EU postpone its trade deal with Vietnam until human rights improved has been sentenced to 15 years in jail. The EU Commission says it first needs to conduct a detailed analysis before responding.

Stakeholders' Highlights

  1. Nordic Council of MinistersDigitalisation can help us pick up the green pace
  2. Nordic Council of MinistersCOVID19 is a wake-up call in the fight against antibiotic resistance
  3. Nordic Council of MinistersThe Nordic Region can and should play a leading role in Europe’s digital development
  4. Nordic Council of MinistersNordic Council to host EU webinars on energy, digitalisation and antibiotic resistance
  5. UNESDAEU Code of Conduct can showcase PPPs delivering healthier more sustainable society
  6. Nordic Council of MinistersWomen benefit in the digitalised labour market

Latest News

  1. US rejects Slovenia-linked plan to break up Bosnia
  2. Ukraine urges Borrell to visit Russia front line
  3. Could US sanctions hit Russia vaccine sales to EU?
  4. Polish court pushes out critical ombudsman
  5. Political crises in Romania and Bulgaria amid third wave
  6. Von der Leyen's summer plans undisclosed, after Ukraine snub
  7. Over a million EU citizens back farm-animal cage ban
  8. Three options for West on Putin's Ukraine build-up

Join EUobserver

Support quality EU news

Join us