Apple has been ordered to pay 13 billion euros ($14.4 billion) in unpaid taxes to the Irish state, in a court ruling that ended a decade-long battle between Europe and the tech giant.
In a ruling issued on Tuesday, the Court of Justice of the European Union (CJEU) ruled in favor of a European Commission ruling of 2016which found that over a period of more than 20 years Apple enjoyed illegal tax advantages that constituted state aid from the Irish government.
“The Court of Justice has given its final judgment in the case and upheld the European Commission’s 2016 decision: Ireland granted Apple unlawful aid, which Ireland must recover,” the court said. in a statement.
“Today is a great victory for European citizens and tax justice,” said Margrethe Vestager, European Commissioner for Competition. said in a statement on X“Ireland provided illegal aid to Apple.”
The Irish government said it would respect the court’s decision, saying it had “historical significance only,” arguing that it dates back to revenues in 1991 and 2007 that “are no longer relevant” because it introduced changes to its tax regime. “The Irish position has always been that Ireland does not grant preferential tax treatment to any company or taxpayer,” the government said. Government statement:.
Dr Stephen Daly, a professor of tax law at King’s College London, says he is “surprised” by the decision, which comes after a lengthy back-and-forth legal battle that led the European General Court to rule in Apple’s favour in 2020.
“I didn’t really see it coming,” Daly says. “I thought the Commission’s path to victory was incredibly narrow because it suffered huge defeats in similar cases against Fiat and Amazon. I thought this would be the same outcome. I’m also surprised because this is the largest tax case in history – €13 billion, which will be more than €14 billion when you add in the interest, which will have to be repaid.”
The case relates to tax deals that Irish authorities struck with Apple in 1991 and 2007 to encourage it to set up two European headquarters in the country. Other companies were not offered the same favourable terms, leading the European Commission to accuse Ireland of giving Apple a “selective advantage”.
Ireland has long been under scrutiny for allegedly providing a tax haven for American companies. During his last term in the White House, current presidential candidate Donald Trump mentioned the country in a speech in which he promised to return “trillions of dollars” in tax revenue to the United States.
“For too long our tax code has incentivized companies to leave our country in search of lower tax rates,” said in 2017“It happens that many, many companies go to Ireland. They go everywhere.”
According to Daly, the CJEU decision “is not good for Ireland”. “Ireland has always tried to position itself as a country that offers generous but fair tax rules,” he says. “This has certainly hurt Ireland Inc.”
