Apple wins appeal against its enormous $14.8 billion European tax bill

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iPhone with gavel.
Decision went in the favor of Apple and Ireland.
Photo: Tingey Injury Law Firm/Cult of Mac

In something of a surprise outcome, Apple and Ireland have won their appeal against a European tax bill order which fined Apple $14.8 billion.

The European Commission ordered Apple pay the enormous sum in August 2016. According to the EU, Apple paid a tax rate as low as 0.005% of its European profits in 2014. This was supposedly part of a “sweetheart” deal it received in Ireland.

Apple paid the last installment of its payment in September 2018. However, it has continued to argue that it has always paid every cent that it owes. While the case was being disputed, the money was held in an escrow account in Ireland.

In its decision today, the European Union’s General Court vetoed the previous European Commission verdict. It said that Apple had not been by given a “selective economic advantage” by Irish tax policies.

Ireland’s Department of Finance praised the ruling. In a statement reported by Sky News, it said that, “Ireland has always been clear that there was no special treatment provided to [Apple]. The correct amount of Irish tax was charged, taxation in line with normal Irish taxation rules.”

Apple’s European tax bill appeal

As I wrote yesterday, Ireland’s involvement in the case is, on the surface, confusing. Under the 2016 verdict, Ireland would have received the money. However, the country has helped Apple fight against having to pay it. One reason for this may be that Apple is a significant employer in Ireland. It also protects Ireland’s reputation as a tax haven welcoming companies.

Ireland eventually helped claim the money from Apple several years ago — although this was only after the EU threatened Ireland with legal action. Yesterday, an Irish politician said that, if Apple lost today’s case, it would be “economic treason” for Ireland not to accept the money, which could be used to put toward local services.

Today’s ruling could — and probably will — be appealed to the European Court of Justice. “I think that no matter what the judgment is, this case will almost certainly be appealed by one party or another to the European Court of Justice,” said Ireland’s Deputy Prime Minister Leo Varadkar previously.

Your move, European Commission!