Ireland could receive an official rebuke from European Union authorities this week for failing to collect the $17.6 billion tax payment it is owed by Apple.
Apple was supposed to pay the money way back on January 3, but Ireland has continued to battle against the case — with the majority of the country saying it doesn’t want Apple’s money. As a result, the European Commission may issue a so-called “non-compliance action” against Ireland.
If Ireland fails to collect the cash, European Commission regulators can sue in court in Luxembourg. Should that happen, Ireland may also be hit with a fine.
Apple versus the European Commission
The European Union handed Apple the massive tax bill in August last year, claiming the company took advantage of illegal state aid that allowed it to route profits through Ireland. The investigation alleged that Apple paid the equivalent of as little as 0.005 percent on all European profits in 2014. Apple CEO Tim Cook has denied any wrongdoing.
One big reason why Ireland may be so opposed to receiving the windfall is due to the fact that Apple has been a major investor in Ireland, and citizens worry that angering the iPhone-maker could cause the country to lose jobs.
The European Commission has also been criticized for having a vendetta against Apple on ideological grounds. In a 2016 editorial, former London mayor Boris Johnson argued that Apple has done nothing wrong, and harangued the “crop-haired … Left-wing” competition directorate in the European Commission, Margrethe Vestager, for getting involved in Ireland’s dealings with Apple.
Once the $17.6 billion tax payment has been collected from Apple, Irish authorities will place the money in an escrow account pending an appeal. If this appeal — which could last for up to half a decade — is successful, Apple will get the money returned. In the meantime, it will be invested.
Source: Bloomberg
