CEO Tim Cook gestures to the audience as he closes the company’s World Wide Developers Conference keynote in San Francisco, California, U.S., June 13, 2016.
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The European Commission, which administer EU law, said that the Irish government had granted illegal state aid to Apple by helping it to artificially lower its tax bill for more than 20 years. The EU said this week that Apple has to pay back $14.5 billion worth of tax it avoided as a result of deals it struck with Ireland.
Apple says it paid $400m (€360m) in taxes in Ireland in 2014, the year when the European Commission says it paid an effective tax rate on its profits of 0.005%.
On Tuesday, the European Commission ruled that Ireland illegally provided state aid to Apple by not collecting €13bn of taxes owed to it by the tech giant over a 10-year period.
“They just picked a number from I don’t know where”, Cook continued.
He claimed that the EC is picking on Apple, but that the company will continue to invest in its long-established corporate base in Cork, and will work with the Irish government, which also opposes the ruling, to appeal against the decision.
Lastly, there was a bone thrown to the United States government with a promise to repatriate “several billion dollars” to the U.S. next year – lest we forget that in the minds of USA politicians, if anyone is owed back taxes, it sure as hell ain’t Ireland. He is also very confident that the Commission’s ruling will be overturned on appeal.
In both interviews, Cook said Apple remained committed to Ireland.
In the meantime, he said that the EU’s tax ruling is set to cause serious trade difficulties between the European Union and the US.
Apple works out its tax rate as if it had paid taxes due in the U.S. at a rate of 35%. This makes it hard for tax authorities to work out where a company’s real business takes place and apply the rules fairly.
Besides Apple, European Union regulators have been scrutinizing the tax arrangements between its member countries and several US companies such as Amazon, Google and McDonald’s. “We believe that makes us the highest taxpayer in Ireland that year”, Cook was quoted as saying.
“It’s maddening, it’s disappointing, it comes from a political place, it has no basis in fact or law”, Cook said of the decision.
Apple has been accused of an illegal deal by basing a headquarters here to take advantage of our low corporate tax rate.
He said: “It’s total political c**p”.
The ratings firm said its A+ rating on Ireland, which is four levels below its top-notch AAA stance, is unaffected by the commission’s decision, which Taoiseach Enda Kenny is trying to get Cabinet approval to appeal. “Apple has always been about doing the right thing, never the easy thing”.
“I don’t think Applehave paid sufficient tax”.
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However, an emergency cabinet meeting of Ireland’s minority government on Wednesday failed to agree, with some ministers demanding a parliamentary vote on the issue.
