EU orders Apple pay record $13 bn in Irish taxes

PanARMENIAN.Net - The European Union on Tuesday, August 30 ordered Apple to pay a record 13 billion euros in back taxes in Ireland, saying deals allowing the U.S. tech giant to pay almost no tax were illegal, AFP reports.

In a ruling that is set to anger Washington, the European Commission said the world's most valuable company avoided tax bills on almost all its profits in the bloc under the arrangements with the Irish government.

Ireland has been seeking to attract U.S. multinationals by offering extremely favorable tax conditions, known as sweetheart deals.

"The Commission's investigation concluded that Ireland granted illegal tax benefits to Apple, which enabled it to pay substantially less tax than other businesses over many years," EU Competition Commissioner Margrethe Vestager said.

"In fact, this selective treatment allowed Apple to pay an effective corporate tax rate of one per cent on its European profits in 2003 down to 0.005 per cent in 2014," she said in a statement.

Ireland immediately said it would appeal against the decision and Apple is also expected to challenge it, AFP says.

"I disagree profoundly with the Commission's decision," Irish Finance Minister Michael Noonan said in a statement. "The decision leaves me with no choice but to seek cabinet approval to appeal the decision before the European Courts."

The tax repayment order, by far the largest in the EU's history, follows a three-year inquiry into whether Dublin's tax breaks for Silicon Valley titan Apple amount to illegal state aid.

Apple has had a base at the southern city of Cork since 1980 and employs 5,000 people in Ireland, through which it routes its international sales, avoiding billions in corporation taxes.