Saturday

16th Oct 2021

Apple ordered to repay a record €13 billion to Ireland

  • Vestager: Decision is "clear message to member states that they cannot give unfair tax benefits" (Photo: ec.europa.eu)

The EU Commission has ordered US tech firm Apple to repay up to €13 billion, plus interest, of unpaid taxes to Ireland.

The EU executive decided that tax rulings from Irish authorities in 1997 and 2011 gave Apple "an undue advantage that is illegal under EU state aid rules".

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

"It's not a penalty, it's unpaid taxes," EU competition commissioner Margrethe Vestager said at a press conference.


She said the commission's decision was a "clear message to member states that they cannot give unfair tax benefits to selected companies".

In its investigation, opened in 2014, the commission looked at how Apple reported its profits between two companies it set up in Ireland - Apple Sales International and Apple Operations Europe.

The US giant "endorsed a split of the profits for tax purposes in Ireland", the commission explained in a statement.

"Under the agreed method, most profits were internally allocated away from Ireland to a 'head office' within Apple Sales International. This 'head office' was not based in any country and did not have any employees or own premises," the commission said.

"Only a fraction of the profits of Apple Sales International were allocated to its Irish branch and subject to tax in Ireland. The remaining vast majority of profits were allocated to the 'head office', where they remained untaxed."

As a result, Apple's tax rate on its profits was only 0.05 percent in 2011 and 0.005 percent in 2014.

EU member states have the right to set their own level of taxation, Vestager said, but Apple was "very very far away" from the normal 12.5 percent Irish corporate tax.

It will be up to Irish authorities to determine the exact amount and methods of repayment.

The commission said other countries might now look at the firm's dealings and decide it should have paid taxes in their jurisdictions.

"That would reduce the amount to be paid back to Ireland," Vestager said.

Immediately after Vestager's announcement, the Irish government said it would appeal to the European Court of Justice.

Apple faces massive Irish tax bill

The EU executive will announce how much the tech giant must pay back to Ireland, two years after it ruled that tax decisions in Dublin amounted to illegal state aid.

Irish government in moral dilemma on Apple tax

Anti-poverty activists in Ireland say the government's decision to appeal an EU commission order for Apple to pay back €13 billion undermines its moral authority.

News in Brief

  1. Poland legalises refugee pushbacks
  2. Report: China's Xi to snub UK climate summit
  3. Norway killings 'appeared to be' Islamist 'terrorism'
  4. Le Pen vows to 'dismantle' wind-power plants
  5. Slovenia PM tweets antisemitic conspiracy theory
  6. Italy sentences ship captain for Libya pushback
  7. Polish PM and von der Leyen to clash in Brussels next week
  8. MEPs call for improved roaming rules

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 MinistersNew report reveals bad environmental habits
  2. Nordic Council of MinistersImproving the integration of young refugees
  3. Nordic Council of MinistersNATO Secretary General guest at the Session of the Nordic Council
  4. Nordic Council of MinistersCan you love whoever you want in care homes?
  5. Nordic Council of MinistersNineteen demands by Nordic young people to save biodiversity
  6. Nordic Council of MinistersSustainable public procurement is an effective way to achieve global goals

Latest News

  1. MEPs urge Sassoli to sue EU Commission on rule of law
  2. MEPs seek EU law on bogus anti-media litigation
  3. Africa seeks EU help on global vaccine-waiver
  4. Giant of 20th century European design recognised by EU
  5. Italy on edge as neo-fascists stir violence
  6. Gas-price spike will backfire on industry, energy guru says
  7. Scientists raise alarm on Greenland's ice-sheet loss
  8. EU calls for ban on Arctic oil and gas drilling

Join EUobserver

Support quality EU news

Join us