European Commission may have lost Apple tax case, but it believes it’s morally in the right

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The tax battle with Apple looks set to rage on.
Photo: New York Public Library/Unsplash CC

The European Commission may have lost its court case about Apple’s $14.8 billion tax bill, but it continues to believe that it’s morally in the right.

“We do not consider it normal that the largest corporates get away with paying one percent tax at most,” European Commission executive vice-president Valdis Dombrovskis told reporters in the aftermath.

European Commission and Apple’s tax payments

The European Commission ordered Apple pay the enormous sum in August 2016. This was supposedly part of a “sweetheart” deal Apple received in Ireland. Apple paid the last installment of its payment in September 2018. However, the money was held in an escrow account while Apple and Ireland appealed it. It won the court case on Wednesday, laying the groundwork for the decision to be reversed.

But Dombrovskis believes that, while Apple may have won in court, the decision is not a just one. “It is just not sustainable from a tax-fairness point of view, it is not sustainable from a public revenues point of view and it needs to be addressed,” he said.

Meanwhile, Paolo Gentiloni, the EU commissioner for economy, suggests that there could be an appeal on the way. “A single ruling is not discouraging our commitment in this sense. I would say the contrary,” Gentiloni said.

Apple says the case wasn’t about how much it pays, but where it pays it

Apple has always argued that it pays every cent of tax that it owes. During a 2015 “Inside Apple” episode of 60 Minutes, Tim Cook labelled reports that Apple doesn’t pay its taxes as, “total political crap.”

“This case was not about how much tax we pay, but where we are required to pay it,” Apple said in a statement following this week’s court case decision.

The court case on Wednesday concluded that the European Commission had not produced enough evidence that Apple benefited from illegal state aid in Ireland.

Ireland’s Department of Finance praised the ruling. In a statement reported by Sky News Wednesday, 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.”

Via: EUObserver