Apple must pay Ireland more than $14 billion in back taxes, court rules
The European Union’s top court on Tuesday rejected Apple’s final legal challenge against an order from the bloc’s executive commission to repay 13 billion euros, or the equivalent of more than $14 billion, in back taxes to Ireland, bringing an end to the long-running dispute.
The European Court of Justice overruled a lower court’s earlier decision in the case, saying it “confirms the European Commission’s 2016 decision: Ireland granted Apple unlawful aid which Ireland is required to recover.”
The case drew outrage from Apple when it was opened in 2016, with CEO Tim Cook calling it “total political crap.” Then-U.S. President Donald Trump slammed European Commissioner Margrethe Vestager, who spearheaded the campaign to root out special tax deals and crack down on big U.S. tech companies, as the “tax lady” who “really hates the U.S.”
The European Commission, the bloc’s executive branch, had accused Apple of striking an illegal tax deal with Irish authorities so that it could pay extremely low rates. The European Union’s General Court disagreed with that in its 2020 ruling, which has now been overturned.
“We are disappointed with today’s decision as previously the General Court reviewed the facts and categorically annulled this case,” Apple said in a statement.
“There has never been a special deal,” the company said.
Closing loopholes
Eight years ago, the ruling that found Ireland had granted a sweetheart deal that let Apple pay almost no taxes across the European bloc for 11 years dramatically escalated the fight over whether America’s biggest corporations are paying their fair share around the world.
The EU head office said that Ireland granted such lavish tax breaks to Apple that the company’s effective corporate tax rate on its European profits dropped from 1 percent in 2003 to a mere 0.005 percent in 2014. Apple has disputed such figures.
The ruling that has now been upheld was one of a number of aggressive moves by European officials to hold U.S. businesses, particularly big tech companies, accountable under the EU’s rules on taxation, competition and privacy.
Google also lost its final legal challenge on Tuesday against a European Union penalty for giving its own shopping recommendations an illegal advantage over rivals in search results, ending a long-running antitrust case that came with a whopping fine.
The European Union’s Court of Justice upheld a lower court’s decision, rejecting the company’s appeal against the 2.4 billion euro ($2.7 billion) penalty from the European Commission, the 27-nation bloc’s top antitrust enforcer.
