Apple ordered to pay upwards of $14bn to Ireland in back taxes

After a three-year investigation into Ireland's tax arrangements with Apple, the European Commission has concluded that Apple has been avoiding tax on almost all of its profits from sales between 1991 and 2015.

Europe's antitrust regulator ordered Ireland on Tuesday to demand up to $14.52bn (€13bn) from Apple in back taxes, on account that the country has granted the US company huge illegal tax breaks. EU state aid legislation forbids member states from giving tax benefits to selected companies.

Ireland's finance minister, Michael Noonan, expressed strong discontent with the EC's decision:

Europe's antitrust enforcer has concluded that between 1991 and 2015, Apple has been paying substantially less corporate tax than other such businesses. In 2003, the company paid an effective corporate tax rate of 1 percent on profits of Apple Sales International, with the amount decreasing to merely 0.005 percent in 2014. For comparison — Ireland's corporate tax rate for trading income, sans tax reductions or benefits, is 12.5%.

In an official statement on the matter, EU competition commissioner Margerethe Vestager said that the evidence collected by EC investigators would be strong enough to withstand a possible appeal by Ireland at the CJEU.

The EU's official stance is that Ireland's tax rulings have endorsed an artificial internal allocation of profits within Apple Sales International and Apple Operations Europe, which has “no factual or economic justification.” Said tax rulings have resulted in most sales profits of Apple Sales International being allocated to a fictitious “head office” that neither had a base, nor any employees, when only the Irish branch of Apple Sales International actually had “the capacity to generate any income from trading.”

Tim Cook, CEO of Apple Inc., has since published an open letter regarding the Commission's decision on the company's website. In it, Cook calls the ruling “unprecedented” and argues that the investigation of the EU antitrust regulator was motivated not by how much taxes Apple pays, but rather by “which government collects the money.”

The letter goes on to make a case that, since almost all of Apple's R&D takes place in California, it is then to be expected that the vast majority of its profits will be taxed within the United States, and not Europe.

“European companies doing business in the U.S. are taxed according to the same principle. But the Commission is now calling to retroactively change those rules [...] Using the Commission’s theory, every company in Ireland and across Europe is suddenly at risk of being subjected to taxes under laws that never existed,” writes Cook.



154. belosava

Posts: 127; Member since: Apr 14, 2014

Apple fanboys trolling

151. flavius22

Posts: 218; Member since: Aug 23, 2015

Ofc man im living in Ireland and these guys here got rich atracting hudge companies with their low taxes. Ofc its cheating


Posts: 127; Member since: Nov 25, 2015

As much as Illegal may looks it was an agreement between The Irish Government and Apple, is it right...??? Nope.....but Apple like any Business is out there to make Money.....!!!!!

124. ebilcake

Posts: 1234; Member since: Jul 16, 2016

Even when it it means knowingly making deals with corrupt governments? Yes, that definitely sums on Apple pretty well actually.

94. Firenze91

Posts: 206; Member since: Nov 19, 2014

f**k!!! they will probably increase the price of the iPhone 7 to make up for this loss...

101. ebilcake

Posts: 1234; Member since: Jul 16, 2016

Shouldn't made any difference, but if they do then it just confirms what we already know, they're scum.

88. talon95

Posts: 1012; Member since: Jul 31, 2012

It's about time! Quite generous of the EU to allow them to bring their money back to the US and pay taxes here instead. Either way it puts European and American companies on more level ground with Apple since Apple can't just cheat the system.


Posts: 2819; Member since: Oct 03, 2012

Burn Apple Burn! These tax constructions are illegal even if they are approved by a government! Because then is should apply to all company's and people!

96. RebelwithoutaClue unregistered

Keep in mind that others will follow. Google, Microsoft, Samsung, Facebook and so on. They all use these tax evasion constructions via Netherlands and Ireland. Estimates are trillions of dollars are evaded that way.

105. kiko007

Posts: 7525; Member since: Feb 17, 2016

True enough. I know Google has been in the EU's sights for over a half decade now. However, I didn't think they'd go for Samsung and Facebook as well.

121. marorun

Posts: 5029; Member since: Mar 30, 2015

They all deserve to pay no matter what name they have. No corporation should be allowed to do this. NOT A SINGLE ONE. no fanboyism excuse accepted.

80. darkkjedii

Posts: 31801; Member since: Feb 05, 2011


95. RebelwithoutaClue unregistered

That sums it up lol

75. ebilcake

Posts: 1234; Member since: Jul 16, 2016

That's going to be a difficult one to appeal. :-D Seriously, good luck to Apple and Ireland, they need it.

69. athos07m

Posts: 137; Member since: Apr 22, 2012

If Ireland took the whole sum and created a sovereign wealth fund, it would be about the 40th largest such fund in the world. They could spend this on welfare, education, healthcare - or invest globally and decrease the govt debt with the profits by a visible rate. I'm assuming the prime minister's first reaction is for show, and they are already thinking about such options in backrooms.

78. ebilcake

Posts: 1234; Member since: Jul 16, 2016

Clearly Ireland thought it was worth it when they agreed to this so who knows what they're thinking.

120. marorun

Posts: 5029; Member since: Mar 30, 2015

Probably some key ppl in Ireland governement gotten load of money under the table to agree to this.

163. ebilcake

Posts: 1234; Member since: Jul 16, 2016

Probably, difficult to see where the value of this agreement is for Ireland.

32. Mfa901

Posts: 291; Member since: Jul 14, 2012


30. Martineverest

Posts: 521; Member since: Oct 27, 2015

Counter fine from EU...... Consequences of Volkswagen's fine

14. piyath

Posts: 2445; Member since: Mar 23, 2012

European union bs is over the roof now. They don't do s**t to help poor people. That's why Brexit also failed in UK. All those officials want is to fill their pockets with other's money and just pretend to help them back. I'm sure turkey will also go out from this soon. Governments should have the sovereign power to decide what they want and how they want it. Money is not the only thing matters to every country in the world.

33. RebelwithoutaClue unregistered

Turkey isn't a member of the EU, only a candidate.

134. willard12 unregistered

It is funny that he bashed the EU by saying a country will leave even though that country has been begging for over a decade to get in.

100. tedkord

Posts: 17528; Member since: Jun 17, 2009

They weren't forced to join the EU, but when they decided to, they agreed to certain oversight to balance the scales between member countries.

119. marorun

Posts: 5029; Member since: Mar 30, 2015

Some ppl dont know the word be fair. I personally hope all tax heaven be removed from this earth and any country not cooperating to have the heaviest of economical sanction.

12. willy.4

Posts: 72; Member since: Oct 14, 2015

And now we know the rest of the story..... as to why Mr. Cook sold the amount of shares that he did before the great meltdown...... OH OH..

9. Hoggington

Posts: 356; Member since: Feb 23, 2016

As with many mega corporations, Apple has been avoiding paying it's fair share with the best of them. Tim Cook is is unprecedented. Though I don't think he meant it in a good way...which it is. Rulings like this, even if they don't get enforced in the end, are good for reminding the public that Apple is notorious for dodging taxes. It's a good day when Apple has to try to explain their tax evasion methods. It only further exposes their shady tax tactics.

16. piyath

Posts: 2445; Member since: Mar 23, 2012

It's just your opinion dude. Chill out... lol

18. Hoggington

Posts: 356; Member since: Feb 23, 2016

I'm amazingly chill right now, promise ;)

117. marorun

Posts: 5029; Member since: Mar 30, 2015

I dont feel any anger ect from this post from Hoggington. +1 to you Hoggington for this post.

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