Tim Cook swoops into Brussels to lobby to maintain Irish tax rate

22 Jan 2016

Apple CEO Tim Cook arrived with no fanfare in Brussels this week to lobby the European Union’s (EU) antitrust chief with the aim of ensuring the company doesn’t lose its agreement with the Irish Government regarding the amount of tax it pays.

Tim Cook is well aware that the EU is soon to rule on what will be the outcome for both Ireland and Apple, with the EU claiming Apple has been paying unfairly low tax rates on its earnings here, where its European headquarters are based in Cork.

With the Irish Government and Apple on one side, and the EU on the other, the latter’s commissioner, Margrethe Vestager, has been stating until now that the corporate and governmental agreement here in Ireland cannot continue in the sense that countries can’t just create “sweetheart” deals with particular major corporations.

According to The Financial Times, Tim Cook has already held a private meeting with Vestager over the matter in the hope of convincing her to change her mind, however, what was said in the meeting is unlikely to be revealed anytime soon.

Previous rulings by the EU against other corporations, including Starbucks and Fiat, saw rulings which stated those companies would have to pay as much as €30m in taxes to the Dutch and Luxembourgish governments.

Hinging on conclusion of Irish election

Should the EU rule against the Irish Government and Apple’s wishes it will see Apple forced to hand over at least $8bn (€7.3bn) in taxes to the Irish Government or, at its worst, as much as $19bn.

This latter figure, proposed by JP Morgan, is considered unlikely by legal teams on the ground at Brussels, but even the smaller figure would completely overshadow payments made by any other corporation to-date.

Despite the seemingly uphill struggle facing Apple and the Irish Government, Tim Cook has become rather experienced when it comes to defending his company’s corporate interests, at least in its native US.

The US government is equally angry with Apple for having based its much of its taxable operations here in Ireland, which led to Cook appearing in front of a US senate hearing on the issue.

To his credit, Cook was able to change the minds of some of those senior politicians present at the hearing, but Vestager and the EU are considered to be more stubborn on the matter.

Whatever decision is taken by the EU, no answer is likely before Ireland’s General Election, which is widely expected to take place around the end of February.

Tim Cook drawing image via Thierry Ehrmann/Flickr

Colm Gorey was a senior journalist with Silicon Republic