Apple tax probe verdict could be revealed by EU next month

17 Jun 2016

The new Apple Store in Brussels

Ireland’s Finance Minister Michael Noonan has hinted that the European Commission may deliver its verdict on Apple’s tax arrangements with Ireland as soon as next month.

“The speculation now is that the Commission may make a decision sometime in July,” Minister Noonan said in an interview with Bloomberg in Luxembourg. He added: “though, we don’t know that with certainty”.

At the core of the European Commission investigation into Apple’s tax affairs is whether Apple’s tax arrangements with the Irish Government went against international guidelines.

‘We feel that we’ve paid every cent of tax that’s due in Ireland’

Ireland has vehemently denied there was any preferential treatment.

For its part, Apple too has strenuously denied it has any special arrangements with Ireland, with CEO Tim Cook stating in 2013: “We have no special deal with the Irish Government.”

In preliminary findings in 2014, European antitrust authorities said Apple’s tax arrangements were improperly designed to give the company a financial boost in exchange for jobs in Ireland.

Will Apple be vindicated?

Various estimates reckon that Apple stands to lose anything between hundreds of millions of dollars right up to $19bn if the Commission finds against it and forces Ireland to recoup taxes.

In the past year, the Commission has probed at least three companies over their tax arrangements in Europe, including Google, McDonalds, Starbucks and Ikea, and it is keen to make examples. In recent weeks, French authorities raided Google’s Paris offices over allegations the internet giant was involved in tax fraud and money laundering.

Apple has had operations in Ireland since 1980, when it was still just a young start-up led by Steve Jobs. In the past 36 years, the operation has grown to 5,000 people and, last year, CEO Tim Cook revealed the company will be adding 1,000 new jobs in Cork.

In March, the country manager of Apple Ireland Cathy Kearney addressed the European Parliament.

She said that the company is not getting unfair state aid and remains “committed to Ireland”, whatever the outcome of the European Commission’s case against the iPhone maker.

“We feel that we’ve paid every cent of tax that’s due in Ireland. We don’t feel that there has been state aid involved, and I suppose we look forward to that outcome happening at the end of the day and being vindicated in that view,” Kearney said.

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