According to reports from Guardian UK, Apple has been ordered by the EU to pay up to EUR13 billion in back taxes to Ireland after the European commission ruled that deals between Apple and the Irish tax authorities amounted to illegal state aid.
The commission said Ireland’s tax arrangements with Apple between 1991 and 2015 had allowed the US company to attribute sales to a “head office” that existed on paper only and could not have generated such profits.
The result was that Apple avoided tax on almost all profits from sales of its products across the EU’s single market by booking the profits in Ireland rather than the country in which the product was sold.
The taxable profits of Apple Sales International and Apple Operations Europe did not correspond to economic reality, the commission said. Apple paid an effective tax rate of 1% in 2003 on profits of Apple Sales International. The rate dropped to 0.005% in 2014.
Margrethe Vestager, the European competition commissioner, said: “Member states cannot give tax benefits to selected companies – this is illegal under EU state aid rules. The commission’s investigation concluded that Ireland granted illegal tax benefits to Apple, which enabled it to pay substantially less tax than other businesses over many years.”
The €13bn, plus interest to be recovered, covers the 10 years before the commission first requested information in 2013. Apple changed its tax arrangements with Ireland in 2015.
Ireland’s finance minister, Michael Noonan, said Dublin would appeal against the ruling.
Live EU orders Apple to pay up to €13bn in Irish taxes – business live
The European Commission says Ireland gave Apple illegal tax benefits worth up to €13bn