European Commission to appeal Apple tax ruling

European Commission to appeal Apple tax ruling

© Sundry Photography

The European Commission has decided to appeal a court ruling that US tech giant Apple did not receive illegal state aid from Ireland and does not have to pay €14 billion in back taxes.

The Commission concluded in 2016 that Ireland broke EU state aid rules by granting undue tax benefits to Apple and ordered the country to collect the unpaid taxes for the years 2003–14.

However, Ireland appealed the decision to the General Court of the European Union (EGC), which annulled the Commission’s decision, concluding that it “did not succeed in showing to the requisite legal standard that there was a selective advantage” for Apple.

Margrethe Vestager, an executive vice-president of the European Commission, said today that the Commission “respectfully considers that in its judgment the General Court has made a number of errors of law”.

She added: “Making sure that all companies, big and small, pay their fair share of tax remains a top priority for the Commission. The General Court has repeatedly confirmed the principle that, while member states have competence in determining their taxation laws, they must do so in respect of EU law, including state aid rules.

“If member states give certain multinational companies tax advantages not available to their rivals, this harms fair competition in the European Union in breach of state aid rules.

“We have to continue to use all tools at our disposal to ensure companies pay their fair share of tax. Otherwise, the public purse and citizens are deprived of funds for much needed investments – the need for which is even more acute now to support Europe’s economic recovery.

“We need to continue our efforts to put in place the right legislation to address loopholes and ensure transparency. So, there’s more work ahead – including to make sure that all businesses, including digital ones, pay their fair share of tax where it is rightfully due.”

Irish Finance Minister Paschal Donohoe said: “I note the decision of the European Commission to lodge an appeal to the CJEU.. Ireland has not yet been served with formal notice of the appeal.

“When it is received, the government will need to take some time to consider, in detail, the legal grounds set out in the appeal and to consult with the government’s legal advisors, in responding to this appeal.”

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