Apple Could Face $8 Billion Irish Tax Dodging Bill

By Annifer Jackson

Technology giant Apple may be asked to pay back taxes amounting to more than $8 billion by the European Commission (EC) after its dealings in Ireland breached state aid regulations.

The EC published a report looking into tax workings made between 1990 and 2007 that were found to be advantageous to Apple and not complying with rules followed by other businesses operating in the single market.

Article 14 of Council Regulation (EC) No 659/199935 states that all unlawful aid may be recovered from the recipient, meaning that the iPhone producer could be forced to pay back $8 billion plus interest.

Many technology companies have established a European base in Ireland because of its low corporate tax of 12.5 percent.

A report from the US Senate last year even claims that Apple shifted billions of worldwide sales away from the country and into Ireland where it agreed a tax rate of just two percent.

The EC has the power to fine companies up to 10 percent of revenues, which would double Apple’s bill.

It also has the power to fine Ireland $1 billion, with the country’s government denying any malpractice. In a statement it said: “Ireland is confident that there is no breach of state aid rules in this case and has already issued a formal response to the Commission earlier this month, addressing in detail the concerns and some misunderstandings contained in the opening decision.”

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