The European Union’s General Court on Wednesday overturned the European Commission’s landmark 2016 finding that tax breaks Ireland granted to U.S. tech giant Apple gave it a competitive advantage, nullifying the order that Apple repay Ireland €13 billion (about US$14.8 billion), reports Law360 (a subscription is required to read the entire article).
The Court said the EU authority, led by antitrust chief Margrethe Vestager, had failed to show Ireland’s tax arrangements with the company were illegal state aid. However, the decision can be appealed.
The Europe’s anti-trust and consumer investigation agency claimed that Ireland, Luxembourg and the Netherlands attracted investment and jobs by helping big companies avoid tax in other countries, including EU members. The commission said Ireland was too lenient in rulings it gave to Apple and which helped the company shield tens of billions of dollars in profit from taxation.
At 12.5%, Ireland’s corporate tax rate beats the US rate of 35%. However, participating companies don’t pay that 12.5% under the double Irish structure.
CEO Tim Cook branded the European Commission ruling “total political crap.” Apple’s CEO also suggested the “retroactive” tax bill was an attempt by the EU to grab taxes owed to the U.S. treasury and harmonize tax rates across the 28-nation bloc.
