The Apple Inc. logo is displayed at the company’s store in the Omotesando district of Tokyo, Japan on Wednesday June 3, 2020.
Bloomberg
Apple won a court case on Wednesday against the European Commission over a dispute over 13 billion euros ($ 15 billion) in Irish tax.
In a long-awaited landmark decision, the EU General Court decided that the European Commission failed to demonstrate that the Irish government had given the US tech giant an advantage.
The Commission, the executive arm of the EU, had In August 2016, it concluded that the Irish government granted Apple illegal tax benefits and ordered it to recover € 13 billion.
At the time, the Commission said Ireland had allowed Apple to pay “substantially less tax than other companies for many years,” meaning that the US firm He was allowed to pay an effective corporate tax rate of 1% on his European earnings in 2003, which fell to 0.005% in 2014.
The Irish government and Apple decided to appeal the Commission’s decision, arguing that the order to refund the taxes “defies reality and common sense.”
Ireland, Apple and the European Commission now have two months to decide whether they want to appeal the latest court ruling and potentially bring it to the highest court in the EU.
In reaction to the court ruling, the Irish government said on Wednesday that it has always been clear “that no special treatment was provided to the two Apple companies” and that “the correct amount of Irish tax was levied in accordance with the normal Irish taxes. ” rules.”
The European Commission and Apple were not immediately available for comment when CNBC contacted Wednesday morning.
Because it is important?
This case, which involves a giant American tech company, is particularly important and a central element of the EU’s tax crackdown in recent years. It could affect how the Brussels institution deals with other companies on tax matters.
Taxes are taking an even more prominent role in the wake of the Covid-19 crisis. With many governments increasing their spending, they will seek new sources of income in the form of taxes.
In this context, there is an ongoing debate on whether the European Union should have its own digital tax: a tax on the big tech giants to ensure they pay a fairer share compared to more traditional companies.
Arancha González, Spain’s foreign minister, told CNBC’s “Squawk Box Wednesday”: “If the companies are American, if they are Chinese, Japanese, Korean or European, it is about the justice of the tax systems.”
Plans by some European nations, including Spain, to tax the tech giants the most have met opposition from the United States, which argues that the tax is discriminatory towards their national companies.
“What we are saying is that justice requires all economic activity, whether economic activity is provided analogically or digitally to contribute its fair share of taxes,” added the Spanish minister.
This is breaking news and is being updated.
.
