EU coun­tries want slice of Ap­ple too

The Myanmar Times - - Business | International -

BUD­GET squeezed EU coun­tries will ask Brus­sels for a share of the bil­lions in Ir­ish back taxes or­dered from Ap­ple, bring­ing fur­ther prob­lems to the tech gi­ant af­ter the lack­lus­tre launch of the iPhone 7.

The Euro­pean Com­mis­sion, the EU’s com­pe­ti­tion reg­u­la­tor, last month or­dered Ap­ple to re­im­burse a record 13 bil­lion eu­ros (US$15 bil­lion) in un­paid taxes in Ire­land.

As part of its his­toric de­ci­sion, which has an­gered Wash­ing­ton, the com­mis­sion said other EU coun­tries could also seek to claim a slice of the money pot, though doubts on the le­gal­ity of the claims still re­main.

Spain, which is un­der threat of an EU fine for break­ing spend­ing rules, said it was ur­gent to know how much Ap­ple may have de­nied Span­ish tax­pay­ers.

In its land­mark de­ci­sion on Au­gust 31, the com­mis­sion ar­gued that Dublin handed Ap­ple favourable tax terms that amounted to state aid – il­le­gal un­der its rules.

EU Com­pe­ti­tion Com­mis­sioner Mar­grethe Vestager called Ap­ple’s Ir­ish op­er­a­tions a “sham”, de­signed to fun­nel rev­enue from across the globe to avoid pay­ing tax.

“Of course we are ex­am­in­ing it,” said Ger­many’s Wolf­gang Schaeu­ble, the EU’s most pow­er­ful fi­nance min­is­ter af­ter two days of talks with his bloc coun­ter­parts.

But Mr Schaeu­ble, like many min­is­ters, said much would de­pend on what the EU’s still-sealed de­ci­sion ac­tu­ally con­tained, adding that he would ask the com­mis­sion to clar­ify the is­sue at talks next month.

The Euro­pean Com­mis­sion said Ap­ple only paid an ef­fec­tive cor­po­rate tax rate of just 0.005 per cent on its Euro­pean prof­its in 2014 – equiv­a­lent to just 50 eu­ros for ev­ery mil­lion.

That low rate “brought home the enor­mity of the prob­lem and the enor­mity of the chal­lenge that it doesn’t hap­pen again,” said OECD sec­re­tary gen­eral An­gel Gur­ria, who has led a global cam­paign to re­form tax laws.

Mr Gur­ria said that the com­mis­sion had clearly opened the door to shar­ing the tax pot to all coun­tries, in­clud­ing the United States.

But any big pay day is a long way off, with Ap­ple and Ire­land com­mit­ted to ap­peal­ing the de­ci­sion which launches an EU court bat­tle that could take years. –

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