All of that money flows through Ireland for tax purposes.
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The commission ruled that Ireland had breached state aid rules by letting the tech giant pay as little as 0.005 per cent – €50 (£42) on every million in profits – over more than a decade.
Apple is confident it can wipe the pie off its face after it was hit by a whopping €13 billion (NZD $20 billion) in retroactive taxes, as CEO Tim Cook has come out fighting in an open letter to Europe’s Apple community. “They just picked a number from I don’t know where”, Cook explained.
“This is about Ireland, it is about our people, it’s about us as a sovereign nation, actually setting out what we consider our appropriate policies”, Taoiseach Enda Kenny said after a Cabinet meeting.
He also said it was important to tell voters that given Apple meant to appeal the ruling, the 13 billion euros would sit in an escrow account for a number of years and there would therefore be “no immediate bonanza” for taxpayers.
He said: “I think it’s clear that there is a desire to harmonise tax rates the European Union”.
On June 11, 2014, the EU Commission announced that they are opening an investigation into Apple, Starbucks and Fiat in relation to tax arrangements with three EU countries.
Meanwhile, Margrethe Vestager, Europe’s top competition official defended the ruling, stating, “All of us benefit when businesses pay their fair share of tax”.
Ireland’s nominal corporate tax rate is 12.5 percent; the US rate is 35 percent.
He said that Ireland was being singled out and he hoped that the Irish government would appeal the ruling.
Apple can credit any tax it pays overseas against the 35 per cent it must pay should it bring offshore profits home.
Mr Cook said: “It’s total political crap”.
“I think we’ll work very closely together, as we have the same motivation”. Cork politician Donnchadh O Laoghaire supported his party’s call not to appeal the tax ruling. “There is no reason for it in fact or in law”.
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Apple disputes these figures but Vestager has stuck to her guns. Next week it will stage a product launch, which is expected to include an iPhone 7, a new Apple Watch and revamped iPads and Macbooks.
