Apple Wins Fight over $14.9 Billion Tax Bill

Apple won its court battle over a $14.9 billion (13 billion-euro) Irish tax bill, Bloomberg reported. The EU General Court sided with Apple, saying the European Commission failed to show Ireland’s tax arrangement with the company were illegal state aid. This decision can be appealed.

Bloomberg reported that Apple welcomed the ruling, saying the case “was not about how much tax we pay, but where we are required to pay it.”

This situation goes back to 1991, when Ireland granted its first “tax ruling” to Apple, the Irish Times reported. Apple’s tax agreement in Ireland was replaced in 2007 by a second “tax ruling”.

In 2013, US Senators John McCain and Carl Levin labeled Ireland a “tax haven for multinational companies such as Apple” in a hearing in Washington on tax avoidance. Later in 2013, Minister for Finance Michael Noonan outlined plans to ensure Irish-registered companies cannot be “stateless” for tax purposes. This included Apple’s arrangements.

In 2014, EU issued preliminary findings that Apple’s tax arrangements were improperly designed to give the company a financial boost in exchange for jobs in the Ireland.

In 2016, The EU issued a final decision on the Irish-Apple case, saying the Republic of Ireland must recover up to $13 billion-euro in back taxes from Apple. Later that year, Apple appealed, saying it was singled out as a “convenient target”.

The case was heard by the EU’s second-highest court in 2019. And today, we have the ruling.

The Irish Times reported that the ruling could still be appealed by the commission before the Court of Justice of the European Union, the EU’s highest court. If that happens, it could take another three years before there is a final outcome of the case.

According to The Irish Times, most of the €14.3 billion collected by the Government in 2018 following directions from the commission, including €1.2 billion of interest, will remain in escrow until a final verdict is delivered. In other words, there is the potential that this case will linger for another three years, awaiting the next verdict.