Apple and Ireland win appeal of $14.4B EU tax case

AppleInsiderAppleInsider
Posted:
in General Discussion edited July 2020
The European Commission has been overruled in a legal case where the Irish government argued that Apple was not given unfair and illegal tax advantages by the country.


Apple's Ireland headquarters


Following the European Commission's decision to demand $14.4B in back taxes from Apple, the General Court in Luxembourg has ruled that the Irish government did not unlawfully aid the Cupertino company in reducing its tax bill.

According to the Irish Times, the new ruling states that the EC "did not succeed in showing to the requisite legal standard" that Apple benefited from Ireland's tax laws. This ruling, however, may yet be appealed before the highest court in the EU, the Court of Justice of the European Union.

#EUGeneralCourt annuls the decision taken by the @EU_Commission regarding the Irish #TaxRulings in favour of @Apple #Apple #EUCommission #StateAid pic.twitter.com/KoF6r1n82S

— EU Court of Justice (@EUCourtPress)


Apple has not commented on the case lately, but a spokesperson for the Irish government has welcomed the verdict. "[It comes] at a sensitive time for Ireland," Ryan McGrath told the Irish Times, "which has been forced to fight a rearguard action against European efforts to impose different types of sales and digital taxes in recent years."

The original EU ruling in 2016 claimed that the Irish government gave Apple incentives to file taxes there and offered preferential tax breaks. As a result of that ruling, Apple was required to pay the $14.4B to the EU.

While Apple has made the payment, the money is currently in an escrow account. It will remain there until the result of any possible future appeal.
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Comments

  • Reply 1 of 88
    carnegiecarnegie Posts: 1,078member
    I think this was a no-brainer, Apple and Ireland should have won this appeal. The European Commission's decision never demonstrated what it claimed it did and what it needed to in order to justify the action it took.

    That said, I'm quite surprised that Ireland and Apple did win.
    bshankDogpersonradarthekatrandominternetpersontmayJWSCSpamSandwichhummerchinecat52spheric
  • Reply 2 of 88
    zimmermannzimmermann Posts: 325member
    carnegie said:
    I think this was a no-brainer, Apple and Ireland should have won this appeal. The European Commission's decision never demonstrated what it claimed it did and what it needed to in order to justify the action it took.

    That said, I'm quite surprised that Ireland and Apple did win.
    Let’s wait to see if the EC goes to the Court of Justice for a final verdict. 
    GeorgeBMacronnspheric
  • Reply 3 of 88
    carnegiecarnegie Posts: 1,078member
    zimmermann said:
    carnegie said:
    I think this was a no-brainer, Apple and Ireland should have won this appeal. The European Commission's decision never demonstrated what it claimed it did and what it needed to in order to justify the action it took.

    That said, I'm quite surprised that Ireland and Apple did win.
    Let’s wait to see if the EC goes to the Court of Justice for a final verdict. 
    I suspect the EU will ultimately win. I'm surprised Apple and Ireland even won at this stage though.
    GeorgeBMacronnyuck9
  • Reply 4 of 88
    crowleycrowley Posts: 10,453member
    carnegie said:

    I'm surprised Apple and Ireland even won at this stage though.
    I imagine they are too.  Oh well, a few more years of courtroom wrangling will keep the lawyers bellies full.
    lkruppronnjony0
  • Reply 5 of 88
    aderutteraderutter Posts: 604member
    Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho.
    I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law.
    I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
    bshankDogpersonelijahgJWSCcat52jony0
  • Reply 6 of 88
    crowleycrowley Posts: 10,453member
    aderutter said:
    Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho.
    I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law.
    I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
    This has been gone over many times, there is no retroactive changing of the law, the law came into force in 1992 (I believe it was Maastricht) and Ireland should have adjusted its tax relationship with Apple at the time.  Just because it has taken a number of years for the case to be brought doesn't mean the law has been changed in any way.  It is Ireland that is accused of breaking EU law, not Apple; Apple was merely the beneficiary.  Also, the EU will not "get" anything much from this -  if Apple and Ireland loses the case then the money held in escrow is payable to the tax authorities in Ireland, not the EU.

    Again, this has been covered many times.  Please stop spreading misinformation.
    radarthekatmwhitelkruppGeorgeBMacmuthuk_vanalingamuraharasphericmontrosemacsPeza
  • Reply 7 of 88
    darren mccoydarren mccoy Posts: 86member
    The escrow account may lose €70m this year! Will Ireland have to make up the difference when they have to pay it back? https://www.thejournal.ie/apple-tax-fund-4831661-Oct2019/
  • Reply 8 of 88
    tommikeletommikele Posts: 599member
    Over at 9to5mac the ignorance being expressed is stunning. The euro crowd their is ranting and raving and making up the facts to suit their predisposition towards socialism.

    It really bothers me when people ignore the facts or don't bother to find out what they are or just make them up and over there that seems to be just fine.
    bshankmwhiteelijahgdonjuancat52jony0williamlondonpatchythepirate
  • Reply 9 of 88
    bshankbshank Posts: 255member
    Yes!!!!!!!
    cat52
  • Reply 10 of 88
    bshankbshank Posts: 255member
    tommikele said:
    Over at 9to5mac the ignorance being expressed is stunning. The euro crowd their is ranting and raving and making up the facts to suit their predisposition towards socialism.

    It really bothers me when people ignore the facts or don't bother to find out what they are or just make them up and over there that seems to be just fine.
    :D Yes!!!!
    edited July 2020 cat52
  • Reply 11 of 88
    seankillseankill Posts: 566member
    I say make Apple Pay. They want heavy government spending, they should pay for it; their effective tax rate is too low for the biggest public company in the world. 
    elijahgronn
  • Reply 12 of 88
    anantksundaramanantksundaram Posts: 20,404member
    This is BRILLIANT! So many of us took so much grief here for predicting that this would be the outcome in a just world, and that the EU has a larger problem that it needs to fix instead of looking to lazily finger US companies when it comes to the issue of cross-border taxation.

    Kudos to the EU court! Justice prevails. 
    aderutterJWSCbshankcat52jony0jdb8167
  • Reply 13 of 88
    anantksundaramanantksundaram Posts: 20,404member
    carnegie said:
    zimmermann said:
    carnegie said:
    I think this was a no-brainer, Apple and Ireland should have won this appeal. The European Commission's decision never demonstrated what it claimed it did and what it needed to in order to justify the action it took.

    That said, I'm quite surprised that Ireland and Apple did win.
    Let’s wait to see if the EC goes to the Court of Justice for a final verdict. 
    I suspect the EU will ultimately win. I'm surprised Apple and Ireland even won at this stage though.
    The probability of the EU "ultimately" winning just went down dramatically, sorry. You can't put lipstick on this pig. 
    SpamSandwichJWSCbshankcat52jony0jdb8167
  • Reply 14 of 88
    anantksundaramanantksundaram Posts: 20,404member

    crowley said:
    aderutter said:
    Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho.
    I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law.
    I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
    This has been gone over many times, there is no retroactive changing of the law, the law came into force in 1992 (I believe it was Maastricht) and Ireland should have adjusted its tax relationship with Apple at the time.  Just because it has taken a number of years for the case to be brought doesn't mean the law has been changed in any way.  It is Ireland that is accused of breaking EU law, not Apple; Apple was merely the beneficiary.  Also, the EU will not "get" anything much from this -  if Apple and Ireland loses the case then the money held in escrow is payable to the tax authorities in Ireland, not the EU.

    Again, this has been covered many times.  Please stop spreading misinformation.
    You're the one spreading misinformation, I am afraid. If the money gets credited to Ireland, that is money in the bank for the EU since they will have to send a smaller annual check to the country (Ireland is a net recipient of EU largesse). 

    Moreover, if Apple had lost, the long run consequences for Ireland, by making is less competitive as a destination for US tech investment, might have been for more onerous. You're ignoring some basic facts here. 
    edited July 2020 GeorgeBMacelijahgaderutterSpamSandwichJWSCbshankuraharacat52
  • Reply 15 of 88
    GeorgeBMacGeorgeBMac Posts: 11,421member
    Apple's only crime was essentially receiving stolen goods -- where Ireland undercut EU taxation rules.

    But, if nothing else, this points out the absurdity of international taxation rules -- where a company can fabricate a "headquarters" in some low taxation environment and then operate in other, better established countries and take advantage of the societal advantages there -- societal advantages reaped from infrastructure and stability from a strong central government supported by an adequate revenue stream.

    This is not new:   companies have been locating fake headquarters in Caribbean tax havens for decades.  In fact, that area featured prominently in the causes of the 2008 Great Recession where bad loans were packaged into highly rated CDO's in these Caribbean shelters and sold to unsuspecting buyers.   Essentially, it is one country bypassing international rules to benefit itself -- much like any organized crime family does the same.

    It is past time that international taxation conventions be modernized to insure that companies (not just Apple) pay for the benefits they receive in the countries they operate in.
    elijahgronnaderutter
  • Reply 16 of 88
    GeorgeBMacGeorgeBMac Posts: 11,421member
    seankill said:
    I say make Apple Pay. They want heavy government spending, they should pay for it; their effective tax rate is too low for the biggest public company in the world. 

    It was Ireland who broke the law, not Apple.   Apple reaped the benefits of the scheme (as did Ireland).  But it was Ireland who committed the crime -- Apple basically simply received the stolen goods.
    elijahgsphericPeza
  • Reply 17 of 88
    anantksundaramanantksundaram Posts: 20,404member
    GeorgeBMac said:
    seankill said:
    I say make Apple Pay. They want heavy government spending, they should pay for it; their effective tax rate is too low for the biggest public company in the world. 

    It was Ireland who broke the law, not Apple.   Apple reaped the benefits of the scheme (as did Ireland).  But it was Ireland who committed the crime -- Apple basically simply received the stolen goods.
    There is absolutely no inherent right for anyone to forcibly grab other people's money. The EU's internecine failures are not Apple's problem.

    Guess what, sometimes, courts agree.
    elijahgJWSCbshankcat52jony0
  • Reply 18 of 88
    gatorguygatorguy Posts: 24,213member
    carnegie said:
    zimmermann said:
    carnegie said:
    I think this was a no-brainer, Apple and Ireland should have won this appeal. The European Commission's decision never demonstrated what it claimed it did and what it needed to in order to justify the action it took.

    That said, I'm quite surprised that Ireland and Apple did win.
    Let’s wait to see if the EC goes to the Court of Justice for a final verdict. 
    I suspect the EU will ultimately win. I'm surprised Apple and Ireland even won at this stage though.
    The EU's case presentation was apparently less than stellar, losing on the preparation but not yet on the facts. I tend to agree with you that in the end Ireland (and by extension Apple) won't win this one. 
    ronn
  • Reply 19 of 88
    crowleycrowley Posts: 10,453member

    crowley said:
    aderutter said:
    Good news, it was obvious that the EU were on a money grab and trying to retroactively change the law to do so imho.
    I’m not saying Apple and Ireland will ultimately win even though I do not believe for a minute Apple broke the law.
    I do believe the EU will more than ever given recent economic events do anything they can get to as much as they can from anywhere they can.
    This has been gone over many times, there is no retroactive changing of the law, the law came into force in 1992 (I believe it was Maastricht) and Ireland should have adjusted its tax relationship with Apple at the time.  Just because it has taken a number of years for the case to be brought doesn't mean the law has been changed in any way.  It is Ireland that is accused of breaking EU law, not Apple; Apple was merely the beneficiary.  Also, the EU will not "get" anything much from this -  if Apple and Ireland loses the case then the money held in escrow is payable to the tax authorities in Ireland, not the EU.

    Again, this has been covered many times.  Please stop spreading misinformation.
    You're the one spreading misinformation, I am afraid. If the money gets credited to Ireland, that is money in the bank for the EU since they will have to send a smaller annual check to the country (Ireland is a net recipient of EU largesse). 
    That is possible, but is not a direct result of the ruling and it would not be to the tune of $14.4b.

    Moreover, if Apple had lost, the long run consequences for Ireland, by making is less competitive as a destination for US tech investment, might have been for more onerous. 
    That is also possible, but has nothing to do with the EU doing a supposed money grab.  Ireland being less competitive does not benefit the EU specifically, it just levels the playing field, which is what the point of the state aid law was in the first place.

    You're ignoring some basic facts here. 
    Not really, they just weren't particularly relevant to the point being made.
    edited July 2020 ronnavon b7
  • Reply 20 of 88
    davgregdavgreg Posts: 1,037member
    It is all so stupid.
    Corporations do not pay taxes- they pass them on to the customers.
    anantksundaramJWSCbshankuraharacat52
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