Apple pays Ireland record shattering $15 billion lump sum to settle tax dispute

Posted:
in General Discussion edited September 2018
Ahead of an upcoming appeal of a 2016 tax ruling, Apple has paid the equivalent of over $15 billion to the Irish government to settle claims of underpayment of tax to the European Union.

Ireland payments


Apple has paid the entire 13.1 billion euro outstanding balance of its disputed taxes to the government of Ireland, Reuters reported Tuesday, citing Ireland's finance minster.

In addition to the 13.1 billion ($15.3 billion in U.S. dollars), Apple has paid an additional 1.2 billion euros ($1.4 billion) in interest.

The reason for the payments is a 2016 ruling by the European Commission finding that Ireland must collect billions in back taxes from Apple. The ruling found that the Irish government had extended preferential tax treatment to Apple, which has long had its European headquarters in that country. The EU does not allow individual member states to give companies benefits not available elsewhere in the EU.

Both Apple and Ireland are appealing the ruling, and the appeal is expected to start this fall. As of early August, Apple had paid $10.4 billion of the $15.3 billion balance.

In February, the EU said it might drop a court case against the Irish government if it succeeded in covering the money owed by Apple.

The 14.3 billion euros, Reuters said, is enough to fund Ireland's health service for a year.

Irish history

Apple has done business in Ireland since 1980, and currently has about 6,000 employees there, as well as a large community of app developers.

The Irish data center


The company has taken advantage of the ability to pay lower taxes as a result of its presence in Ireland, but when Tim Cook visited the country in June, he said Apple's Ireland presence goes beyond that.

"Honestly speaking, we didn't come to Ireland for tax," Cook told an Irish newspaper during his visit. "We came to Ireland in 1980 because we saw a community we thought we could grow, and could do a number of things to support the continent. We've stayed on course on that over almost four decades. It hasn't been a straight line - life isn't a straight line, things go up and down - but it's always been in a trajectory that is increasing. I don't anticipate that changing."

In May, Apple canceled its Athenry data center project in Ireland, citing delays in the approval process. On his visit, Cook made clear that Apple has no plans to leave Ireland.
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Comments

  • Reply 1 of 22
    Would that be AppleCare++?
    lostkiwi
  • Reply 2 of 22
    Jonny KJonny K Posts: 3unconfirmed, member
    Also totally inaccurate as the money was paid into escrow. In fact it went straight to New York not Ireland. We will not see any, if at all, for 6 or 7 years. 
    dysamoriarandominternetpersonSpamSandwichlostkiwi
  • Reply 3 of 22
    I'm sure Apple settled this in an advantageous way for Apple. Minor loss, greater long-term gain...genius.
  • Reply 4 of 22
    Which is it?  Did Apple settle the case or did they just hand over money that they may or may not recoup depending on the outcome of the ongoing legal battle?  The latter is hardly news.

    Edit:  I read the linked article and it is the latter.  Apple made it's last escrow payment.  Yawn.
    edited September 2018 SpamSandwichchasmanantksundaram
  • Reply 5 of 22
    And all in the form of iTunes gift cards. 
    fotoformatanton zuykovrandominternetpersonpulseimagesartdent
  • Reply 6 of 22
    And all in the form of iTunes gift cards. 
    ONE gift card )
    SpamSandwich
  • Reply 7 of 22
    nunzynunzy Posts: 662member
    The EU needs Apple more than Apple needs the EU.

    Apple should pack up and leave, and see how the EU likes that!

    Apple pays more taxes than everybody else.

  • Reply 8 of 22
    Mike WuertheleMike Wuerthele Posts: 4,096administrator
    Which is it?  Did Apple settle the case or did they just hand over money that they may or may not recoup depending on the outcome of the ongoing legal battle?  The latter is hardly news.

    Edit:  I read the linked article and it is the latter.  Apple made it's last escrow payment.  Yawn.
    FTA: "Both Apple and Ireland are appealing the ruling, and the appeal is expected to start this fall. As of early August, Apple had paid $10.4 billion of the $15.3 billion balance."
    bshank
  • Reply 9 of 22
    ""Honestly speaking, we didn't come to Ireland for tax," Cook told an Irish newspaper during his visit. "We came to Ireland in 1980 because we saw a community we thought we could grow, and could do a number of things to support the continent."

    Yeah, RIGHT!

    There are so many communities that "could grow" and many continents that need "support", and you just so happened to choose...Ireland, who also quite notably gives incredible tax preferential treatment. Wow, what a happy coincidence, huh?

     The luck o' the Irish has just been smilin' down upon Apple! That big, bad EU had to step in and cause trouble for our shining knight, darn them!

    Guess all the fanboys will be posting here in droves, helping to defend their beloved 900 lb. gorilla. Paying their fair share of taxes...this injustice shall not stand!
  • Reply 10 of 22
    gatorguygatorguy Posts: 19,811member
    fmalloy said:
    ""Honestly speaking, we didn't come to Ireland for tax," Cook told an Irish newspaper during his visit. "We came to Ireland in 1980 because we saw a community we thought we could grow, and could do a number of things to support the continent."

    Yeah, RIGHT!

    There are so many communities that "could grow" and many continents that need "support", and you just so happened to choose...Ireland, who also quite notably gives incredible tax preferential treatment. Wow, what a happy coincidence, huh?

     The luck o' the Irish has just been smilin' down upon Apple! That big, bad EU had to step in and cause trouble for our shining knight, darn them!

    Guess all the fanboys will be posting here in droves, helping to defend their beloved 900 lb. gorilla. Paying their fair share of taxes...this injustice shall not stand!
    The reference to "fanboys" added nothing at all to your post, in fact reason enough for it to be ignored as just a rambling "Android fanboy" dropping by to stir up trouble before dashing off.  You started out OK with a perfectly valid observation,  but then directed insults to the the forum community which will probably end up with your comments being removed.  You accomplishing nothing because of juvenile name-calling. How silly.  
    edited September 2018 bb-15macxpressmuthuk_vanalingamsingularitylostkiwijony0badmonk
  • Reply 11 of 22
    entropysentropys Posts: 1,500member


    The reason for the payments is a 2016 ruling by the European Commission finding that Ireland must collect billions in back taxes from Apple. The ruling found that the Irish government had extended preferential tax treatment to Apple, which has long had its European headquarters in that country. The EU does not allow individual member states to give companies benefits not available elsewhere in the EU.

    In other words, it wasn’t Ireland that was chasing its tax revenue, it was those fascists in Brussels. This case was about establishing that in tax law, as with much else, the EU  has taken Ireland’s Sovereignty. 


    SpamSandwich
  • Reply 12 of 22
    Which is it?  Did Apple settle the case or did they just hand over money that they may or may not recoup depending on the outcome of the ongoing legal battle?  The latter is hardly news.

    Edit:  I read the linked article and it is the latter.  Apple made it's last escrow payment.  Yawn.
    FTA: "Both Apple and Ireland are appealing the ruling, and the appeal is expected to start this fall. As of early August, Apple had paid $10.4 billion of the $15.3 billion balance."
    Right, so the headline about "a $15 billion lump sum payment" is wrong.  And the word "settle" in the same headline is misleading.  The dispute is far from settled.
    edited September 2018 anantksundarambshankairnerdSpamSandwich
  • Reply 13 of 22
    avon b7avon b7 Posts: 3,208member
    nunzy said:
    The EU needs Apple more than Apple needs the EU.

    Apple should pack up and leave, and see how the EU likes that!

    Apple pays more taxes than everybody else.

    That is just perplexing.

    Why does the EU need Apple at all?

    Apple and taxes. Is the ability to decide how much to make available for taxation and then pay 0.005% on that amount beneficial for the EU?

    If Apple collapsed tomorrow the EU wouldn't bat an eyelid. People would still have phones, computers etc and I can guarantee you the EU would actually receive more in taxation than it currently does.

    Apple's sales would see a significant hit without the EU. I think Apple would rather not lose that revenue.

    nunzyCarnagesingularity
  • Reply 14 of 22
    chasmchasm Posts: 1,094member
    fmalloy said:
    ""Honestly speaking, we didn't come to Ireland for tax," Cook told an Irish newspaper during his visit. "We came to Ireland in 1980 because we saw a community we thought we could grow, and could do a number of things to support the continent."

    Yeah, RIGHT!
    In fact you are incorrect. Apple initially came to Ireland to build Macs; that tax deal you refer to didn’t start until 20 years later. Good luck with trolling around here; we’re pretty well-informed, unlike you.
    jony0watto_cobra
  • Reply 15 of 22
    chasmchasm Posts: 1,094member
    I do feel it could have been made much clearer that this was another escrow payment rather than a settlement. Mike is correct that that fact is strongly inferred by the wording, but only the most careful reader wouldn’t miss that, particularly given the headline.
    anantksundaramwatto_cobra
  • Reply 16 of 22
    Which is it?  Did Apple settle the case or did they just hand over money that they may or may not recoup depending on the outcome of the ongoing legal battle?  The latter is hardly news.

    Edit:  I read the linked article and it is the latter.  Apple made it's last escrow payment.  Yawn.
    Exactly. It is all still under litigation. The headline and content here should be clarified ASAP.
    edited September 2018 SpamSandwich
  • Reply 17 of 22
    gatorguygatorguy Posts: 19,811member
    chasm said:
    fmalloy said:
    ""Honestly speaking, we didn't come to Ireland for tax," Cook told an Irish newspaper during his visit. "We came to Ireland in 1980 because we saw a community we thought we could grow, and could do a number of things to support the continent."

    Yeah, RIGHT!
    In fact you are incorrect. Apple initially came to Ireland to build Macs; that tax deal you refer to didn’t start until 20 years later. Good luck with trolling around here; we’re pretty well-informed, unlike you.
    Chasm, there was a "tax deal" in 1980 too. In fairness there were a few other companies back then who got similar deals. This article is a good one as you'll be even more informed after reading it. 
    https://www.irishtimes.com/business/technology/how-apple-first-landed-in-ireland-1.1405766
    edited September 2018
  • Reply 18 of 22

    Which is it?  Did Apple settle the case or did they just hand over money that they may or may not recoup depending on the outcome of the ongoing legal battle?  The latter is hardly news.

    Edit:  I read the linked article and it is the latter.  Apple made it's last escrow payment.  Yawn.
    FTA: "Both Apple and Ireland are appealing the ruling, and the appeal is expected to start this fall. As of early August, Apple had paid $10.4 billion of the $15.3 billion balance."
    See post right above. @randoninternetperson is spot on. You must clarify your headline and text because they are incorrect.
    SpamSandwich
  • Reply 19 of 22
    avon b7avon b7 Posts: 3,208member
    Apple went to Ireland because Ireland was going out of its way to attract tech companies. Part of that attraction involved better fiscal terms than were being offered by other European countries. Apple wasn't alone and Ireland quickly became a landing ground for some big tech companies.

    In those days the amounts involved were nothing like today and the laws weren't the same either but there is no getting away from the fact that Ireland was actively courting companies and offering 'deals' to tempt them in. This was widely and frequently reported during those years and Ireland became a success story.
  • Reply 20 of 22
    nunzy said:
    The EU needs Apple more than Apple needs the EU.

    Apple should pack up and leave, and see how the EU likes that!

    Apple pays more taxes than everybody else.

    Do you have anything to back up your claims that Apple pays more taxes than everyone else in the EU?
    nunzy
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