Apple is doing a victory dance today. The second-highest court in the European Union overturned a decision that the Cupertino-based technology giant would have to pay Ireland 14.9 billion dollars (13 billion euros) in additional taxes.
This was a landmark victory and a huge blow to the European Commission’s attempt to crack down on multinational companies that cut illegal tax transactions in Europe. in a Press releaseThe European Union’s General Court expressed support for Apple because “the committee failed to show the necessary legal standards” that the company’s sweetheart tax treaty with Ireland made the company unfair.
This particular case has a history of more than ten years. Apple has created two European subsidiaries, Apple Sales International (ASI) and European Apple Operations (AOE), with its headquarters in Ireland. Between 2003 and 2014, the committee Said Apple’s corporate tax rate has dropped from 1% to only 0.005%, and these offices cannot generate the claimed profits. after that Two-year survey, The European Commission ruled in 2016 that the Irish government had granted Apple Illegal state aid. according to independentApple CEO Tim Cook described the case as “completely political nonsense.” Cook firmly denied In a letter Apple has reached any agreement with Ireland, saying the claim “has no basis in fact or law.” In 2017, the company released statement Say “The Apple tax debate is not about how much we owe, but where we owe.” By December of that year, Apple Barely agree Repayment of arrears, in 2018, Fully repaid Deposit trust funds before appealing. As of last year Said tax bill[d] “Reality and common sense”, which shows that in the end it would rather not repay anything at all.
In the statement Bloomberg, Apple reiterated its position in 2017, saying it “not how much tax we have to pay, but where we need to pay the tax.” It added that Apple has paid companies with more than $100 billion worldwide Tax, “There are tens of billions of dollars in other taxes.”
However, don’t be too sad for Ireland. The country supported Apple from the beginning, probably because it was dug into a tax haven. in a statementThe Irish government expressed satisfaction with the ruling. The statement reads: “Ireland has always been very clear that there are no special treatments for the two Apple companies, ASI and AOE.” “The correct Irish tax amount is charged in accordance with normal Irish tax regulations.”
Obviously, the European Commission disagrees. Margrethe Vestager, Executive Vice President of the European Commission, was also the leader of the 2016 decision. statement, “The Commission fully supports the goal that all companies should pay the taxable amount. If member states provide certain multinational companies with tax incentives that competitors cannot obtain, then this will harm fair competition in the EU.”
Vestager said that looking ahead, the EU will consider the next step. It has 14 days to appeal to the Supreme Court of the European Union, the Justice of the European Court. Therefore, although Apple may celebrate its victory today, it may take several years to achieve absolute success. At last Decision on this matter. Until then, these $15 billion will Stay in the custody fund Apple was founded.
The entire collapse has far-reaching effects. Vestager also has Three cases against Google The total amount is about 9.4 billion US dollars, and Amazon is also appealing a 2017 ruling, saying it owes Luxembourg a contract $300 million in tax repayment. The results of these cases may affect the way international taxation of large technology companies (and non-technical multinational companies). In other words, Vestager also Lost one case Last year, Starbucks allegedly owed the Netherlands $33 million in taxes because the committee had already Failed to prove Coffee companies have an unfair advantage. According to Starbucks’ ruling and Apple’s ruling today, it appears that the European Court of Justice does not necessarily disagree with Vestager’s appeal for transnational tax avoidance activities. it indeed concern About the committee doing homework to prove its case.