Apple appeals EU’s $14.5 billion ruling on Irish taxes
Apple and Ireland are appealing an August ruling by the European Union requiring the tech giant to pay $14.5 billion in back taxes.
“The Commission took unilateral action and retroactively changed the rules, disregarding decades of Irish tax law, U.S. tax law, as well as global consensus on tax policy, that everyone has relied on,” Apple said in a statement Monday. Apple (AAPL) shares ended up 0.6% at $116.64.
In August, the European Commission concluded Apple was receiving illegal tax benefits in Ireland for two decades. A threeyear investigation found Apple’s effective corporate tax rate on its European profits dropped from 1% in 2003 to 0.0005% in 2014.
Apple vowed to fight the ruling, and the Cupertino, Calif., tech giant did so in an appeal filed Monday.
“Apple is not an outlier in any sense that matters to the law,” Apple general counsel Bruce Sewell told Reuters. “Apple is a convenient target because it generates lots of headlines.”
In a separate statement, Ireland’s Finance Ministry says the European Commission “misun- derstood” the facts of the case and Irish law.
“Ireland did not give favorable tax treatment to Apple,” reads the ministry’s statement. “The full amount of tax was paid in this case and no State aid was provided. Ireland does not do deals with taxpayers.”
The European Commission referred back to its August statement. Margrethe Vestager, the EU Competition Commissioner who oversees antitrust and competition, in September told USA TODAY: “We find that due to two tax rulings, Apple has received il- legal state aid from Ireland in forms of taxes not being paid. And, of course, these taxes have to be paid.”
The Obama administration has also supported Apple in this case, a contrast with the criticism leveled by some U.S. lawmakers — including President-elect Donald Trump — that Apple has avoided some U.S. income tax by using offshore entities, including those in Ireland.
In a statement, the U.S. Treasury Department said the ruling will threaten America’s corporate tax base.