The European Union General Court today overturned a ruling by the European Commission that Apple should be forced to pay a $14.5 billion tax bill to the Irish government.
The court ruled that the EU authority, led by antitrust chief Margrethe Vestager, failed to prove Ireland’s tax arrangements with the company were illegal state aid. The EU could appeal the decision,
Apple has always funneled all of the revenue for its European Union sales through its European headquarters in Ireland. Apple likely selected the country due to its quite low rate of corporation taxes when compared to other EU countries (12.5%). The Irish government offered Apple an even better deal that meant the Cupertino firm paid even less in taxes.
The EU later ruled that the deal between Apple and Ireland was illegal. While Ireland was actually found to have broken the law, Apple was still on the hook for what the EU considered unpaid taxes. Apple and Ireland both appealed the ruling.
In today’s ruling, the General Court stated:
“By today’s judgement, the General Court annuls the contested decision because the Commission did not succeed in showing to the requisite legal standard that there was an advantage.”
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.”
In an emailed statement to Bloomberg, Apple said that it welcomed today’s ruling.