The European Union’s competition regulators have filed an appeal to the highest court of the bloc, seeking to overturn a previous decision and obligate Apple to pay a historic amount of 13 billion euros ($14.3 billion) in unpaid taxes to Ireland.
This case could have a significant impact on corporate tax payments and has been the focus of EU antitrust chief Margrethe Vestager’s effort to prevent multinational companies from making advantageous agreements with European Union states, according to Reuters.
“Its outcome will determine whether member states may continue to grant multinational substantial tax breaks in return for jobs and investments,” Commission lawyer Paul-John Loewenthal told the Court of Justice of the European Union (CJEU).
In 2016, the European Commission made a decision stating that two Irish tax rulings had artificially reduced Apple’s tax burden for over 20 years, resulting in a tax rate as low as 0.005% in 2014.
Related: Consumer Group Joins EU Apple Antitrust Case
The General Court in 2020 said regulators had not met the legal standard to show Apple had enjoyed an unfair advantage.
Loewenthal argued in court that the judgment was legally flawed and should be overturned.
Apple denied the Commission’s claims and stated that it had fulfilled its tax obligations in the relevant jurisdiction.
“The profits we are talking about – the profits the Commission said should be attributed to these branches in Ireland – those profits were in fact subject to the U.S. tax regime,” Daniel Beard told the Court.
“Apple built up reserves for the payment of those U.S. taxes and is paying around 20 billion euros in tax in the U.S. on those very same profits that the Commission says should have been taxed by Ireland,” he said.
“Apple has paid the taxes that were due under the Irish tax code.” Vestager’s actions resulted in the removal of contentious tax systems in Ireland, the Netherlands, and Luxembourg, and supported the worldwide push for more equitable corporate tax rates.
