EU de­mands Ap­ple pays Ire­land

China Daily (USA) - - BUSINESS - By REUTERS

EU an­titrust reg­u­la­tors or­dered Ap­ple on Tues­day to pay up to 13 bil­lion eu­ros ($14.5 bil­lion) in taxes plus in­ter­est to the Ir­ish gov­ern­ment af­ter rul­ing that a spe­cial scheme to route prof­its through Ire­land was il­le­gal State aid.

The mas­sive sum, 40 times big­ger than the pre­vi­ous known de­mand by the Euro­pean Com­mis­sion to a com­pany in such a case, could be re­duced, the EU ex­ec­u­tive said in a state­ment, if other coun­tries sought more tax them­selves from the US tech giant.

Ap­ple paid tax rates on Euro­pean prof­its on sales of its iPhone and other de­vices and ser­vices of be­tween just 0.005 per­cent in 2014 and 1 per­cent in 2003, the com­mis­sion said.

“Ire­land granted il­le­gal tax ben­e­fits to Ap­ple, which en­abled it to pay sub­stan­tially less tax than other busi­nesses over many years,” said Com­pe­ti­tion Com­mis­sion Mar­grethe Vestager, whose crack­down on mainly US multi­na­tion­als has an­gered Wash­ing­ton which ac­cuses Brus­sels of pro­tec­tion­ism.

Ap­ple said it would ap­peal against the EU rul­ing.

“Ap­ple fol­lows the law and pays all of the taxes we owe wher­ever we op­er­ate. We will ap­peal and we are con­fi­dent the de­ci­sion will be over­turned,” the com­pany said in a state­ment on Tues­day af­ter the Euro­pean Com­mis­sion’s de­ci­sion.

“The Com­mis­sion’s case is not about how much Ap­ple pays in taxes, it’s about which gov­ern­ment col­lects the money. It will have a pro­found and harm­ful ef­fect on in­vest­ment and job cre­ation in Europe,” Ap­ple said.

On­line re­tailer Ama­zon. Inc and ham­burger group McDon­ald’s Corp face probes over taxes in Lux­em­bourg, while cof­fee chain Star­bucks Corp has been or­dered to pay up to 30 mil­lion eu­ros to the Dutch state.

REUTERS

Work­ers pre­pare for the open­ing of an Ap­ple store in Hangzhou, Zhe­jiang prov­ince.

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