Apple pays $118m tax in Japan on earnings sent to Ireland

16 Sep 2016

Shoppers and tourists pass by a large Apple store in Ginza, Tokyo, Japan. Image via Filipe Frazao/Shutterstock

Local authorities in Japan have ordered Apple to pay 12 billion yen ($118m) in taxes for allegedly underreporting earnings that were sent to a business unit in Ireland.

An Apple business unit has since paid the amount, according to local broadcaster NHK.

It is understood that the Tokyo Regional Taxation Bureau determined that the unit, which sends part of its profits earned from fees paid by Japanese subscribers to another Apple unit in Ireland, was withholding tax on those earnings in Japan.

The decision comes on the back of the European Commission ruling requiring Apple to pay €13bn in back taxes, alleging Apple received illegal state aid from Ireland.

Both Apple and the Irish Government have rejected the European Commission’s ruling and have said they intend to appeal in the European courts and overturn the decision.

The €13bn is to be held in an escrow account while the case finds its way through the European courts, in a process that could take several years.

Apple Store in Tokyo image via Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years