She said on Thursday that the calculations were based on data provided by Apple itself and evidence presented during hearings on Apple tax issues in the United States.
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A spokesperson told Bloomberg in a statement: ‘We believe that retroactive tax assessments by the commission are unfair, contrary to well-established legal principles, and call into question the tax rules of individual Member States.
US -based companies are taxed at a 35 percent corporate rate on their global profits but they get tax credits for payments to foreign governments and they don’t pay the USA tax until they bring the money home. “Here is the truth, in that year we paid $400m to Ireland and that was based on the statutory rate of 12.5 per cent”. Apple paid just 0.005% on European profits in 2014.
All of Apple’s business outside of the Americas is conducted through Ireland, which has the second-lowest corporate tax rate in Europe.
Vestager refuted that claim when quizzed by reporters on Thursday. If appealed, she was confident the case would stand up in court.
Apple still planned to go ahead with an expansion in Cork, he said. It may not happen for several more years but it is clear that many countries are systematically closing the loopholes that encourage this kind of behavior. If it was up to me, the non-confidential version of the decision would have been published yesterday, because that is another way of enabling everyone to see what we have decided and on what basis we have made this decision.
“They just picked a number from I don’t know where”, he said, adding that Apple pays 26 percent per year on its global profits.
Cook disputed that figure and the claim. Vestager said: “The enforcement part of the competition portfolio does not really fit into any political picture”.
We’ll be keeping a close eye on this case in the coming weeks and months. “This is due to Apple’s decision to record all sales in Ireland rather than in the countries where the products were sold”, the European Commission said.
Tim Cook, the Apple CEO, has described as “wrongheaded” and “maddening” the European Commission’s finding this week that Ireland’s tax incentives to the tech giant were illegal. I also wish that we could have their headquarters in Turkey.
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U.S. Treasury Secretary Jacob Lew on Wednesday criticized a European ruling that Apple owes more than $14.5 billion in back taxes. The Commission’s investigation revealed that the two companies were internally attributed to a “head office” but they existed only on paper and could not have generated such big profits.
