EU’s ruling on Apple could benefit post-Brexit Britain
Expert says £11bn fine may mean UK deals will attract large firms
CONSUMERS in a post-Brexit Britain could benefit from a landmark EU ruling forcing technology giant Apple to pay a €13 billion (£11.1 bn) tax bill, it has been claimed.
Britain could be able to attract companies such as Apple with its own tax deals outwith the EU following June’s referendum decision, meaning savings could be passed on to UK shoppers, according to one leading expert.
The European Commission ruling found the technology firm paid just one per cent tax on its European profits in 2003 and 0.005 per cent in 2014.
It found the arrangements dating back to the early 1990s were illegal under state aid rules and gave the iPad and iPhones firm favourable treatment over other businesses.
But Neil Wilson, markets analyst at financial services firm ETX Capital, said: “The European Commission seems to be treading very close to interfering with the tax rules of member states, effectively telling Ireland how much tax it ought to levy. It’s also increasingly becoming a supra-national tax judge.
“Britain could benefit. If Ireland cannot offer sweetheart deals within the EU, the City of London can perhaps offer something more appealing outside the bloc.”
Lewis Crofts, global chief correspondent at antitrust trade publication Mlex, added that a Britain no longer in the EU could attract large companies such as Apple with reduced tax deals and the EU would have no say.
However, with any Brexit agreement still to be settled, even if Britain had lower corporation tax than other EU countries, without access to the European single market, multi-nationals could decide to do business in other countries with access to the trading bloc.
Apple boss Tim Cook, who maintained that Apple is committed to Ireland, said the Commission’s decision would “strike a devastating blow to the sovereignty of EU member states over their own tax matters”.
Luca Maestri, the company’s chief financial officer, said the decision would be “devastating” for the European economy.
Downing Street said the UK already offers a low tax environment for firms.
A spokesman said: “Our corporation tax is one of the lowest in the world. We are committed to making the trading condition for companies in Britain as positive for them as it can be as long as it’s positive for the country as a whole.”
Asked whether the Government would like to see Apple relocate in the UK post-Brexit, the No 10 spokesman added: “The narrative from the Government has been well set out. We would welcome any company wishing to invest in Britain.”
However, he stressed all companies registered in the UK are expected to “pay the tax they owe”.
The tax affairs of a string of other firms, including Amazon, Google and McDonald’s, are also set to come under the EU microscope in the coming months.
Apple has vowed to fight the ruling in what will likely be years of courtroom battles.
Ireland’s Department of Finance will also lead a legal challenge to the Commissioner’s record findings and tax bill.