The European Union has laid out its case for a reversal of Apple’s victory in a $13 billion euro ($15.8 billion) tax dispute. The EU says judges used “contradictory reasoning” when they ruled that Apple’s business in Ireland was not liable for the tax levy (via Bloomberg).
In a summary of its appeal published early Monday, the EU laid out its challenge of the court judgment handed down last year. In July 2020, the European Union General Court 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.
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, resulting in it being overturned in July.
Bloomberg reports that the EU’s basis for appealing has now been published.
The European Union is seeking to overturn Apple Inc.’s victory in a 13 billion-euro ($15.8 billion) tax dispute, saying judges used “contradictory reasoning” when they found that the company’s Irish units weren’t liable for huge payments
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The EU said that the lower court improperly conflated Apple’s lack of employees at two Irish units and the company’s level of responsibility for intellectual property on iPhone and iPad sales across Europe. Judges failed to properly weigh the EU’s analysis of the Irish branches and showed “contradictory reasoning” in a separate part of their findings […]
Apple’s Irish units recorded almost all profits from sales outside the Americas, she said, and treating parent and group companies separately allows businesses to “have their cake and eat it” by reducing tax payments.
The final decision will now be made by the EU’s highest court, the Court of Justice of the European Union (CJEU).