Apple has won an appeal against a ruling ordering it to pay $14.9 billion back in taxes to Ireland. EU’s second-highest court overturned the initial ruling which asked the tech company to pay back the record sum.
The European court made the ruling in 2016. It was a significant win for Margrethe Vestager, the EU’s antitrust chief at the time. The court also announced the ruling in a Twitter post.
#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) July 15, 2020
Vestager had alleged that Apple had made a “sweetheart deal” with the Irish government which allowed it to pay taxes of around less than 1 percent of its revenue. Vestager had been hugely critical of the preferential deal which he says counted as “illegal state aid.”
“Member States cannot give tax benefits to selected companies — this is illegal under EU state aid rules. The Commission’s investigation concluded that Ireland granted illegal tax benefits to Apple, which enabled it to pay substantially less tax than other businesses over many years,” Vestager said in 2016.
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Judges of the General Court of the European Union in overturning the 2016 ruling, said in a statement that: “the Commission did not succeed in showing to the requisite legal standard that there was an advantage [for Apple]”.
“The General Court considers that the commission did not prove, in its alternative line of reasoning, that the contested tax rulings were the result of discretion exercised by the Irish tax authorities,” said the court.
The Irish government will feel vindicated by the ruling. Its Department of Finance in its reaction to the ruling, said: “Ireland has always been clear that there was no special treatment provided to [Apple]. The correct amount of Irish tax was charged, taxation in line with normal Irish taxation rules.”
Apple, in reaction to the ruling, said, the case “was not about how much tax [they] pay, but where [they] are required to pay,” according to Bloomberg.
The Commission can appeal the decision, but it has two months and ten days to do so. Within that time, it can appeal the decision at the European Court of Justice, the supreme court of the EU. Any decision by the supreme court of the EU is also final.
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