Vestager backs Ireland to collect €13bn Apple tax bill
EU competition commissioner is in Dublin to appear before committee of MPs
The EU’s competition commissioner said Dublin was working to collect €13bn in unpaid taxes from Apple despite the passing of the original deadline for making the payment.
Margrethe Vestager admitted that collecting the money was proving “complicated” because the sum was so large and because Ireland’s tax authorities were also seeking to work out their own calculations of how much the US technology company owed in unpaid taxes.
Ms Vestager was speaking in Dublin ahead of an appearance before a committee of Irish MPs investigating the shock European Commission ruling in August that Apple owed €13bn in unpaid taxes and that its tax arrangements in Ireland amounted to illegal state aid. Tim Cook, Apple chief executive, angered the MPs this month when he declined an invitation to address the committee.
Ms Vestager denied there was any attempt to single out US companies and said she was not concerned that the Apple ruling would affect US investment in Europe. But she insisted the Irish government had to collect the €13bn owed by Apple.
“The recovery [of the €13bn] has not been done yet, and the Irish authorities are moving forward to collect it,” she said. “It’s tricky to do because it is such a large sum. I appreciate that it is a complicated task.”
The Dublin government reacted furiously to the commission’s Apple findings, causing the biggest rupture between Ireland and the EU since the Irish financial crisis. The ruling has also infuriated Washington, which has accused the EU of unfairly targeting US companies in competition investigations.
Ireland and Apple, which employs nearly 6,000 people in the city of Cork, had been due to resolve the payment issue in early January by placing the money in an escrow account pending separate appeals by both parties against the commission’s finding. The appeals are expected to be lengthy, meaning the case is unlikely to be resolved for several years as it winds its way through the European courts.
Ms Vestager defended the commission’s declaration — which came after a three-year investigation — that two tax rulings offered to Apple by Ireland dating back to the early 1990s allowed the company to avoid tax on an unprecedented scale. She said the €13bn total was accurate “in round figures” and that the Dublin government knew the amount the commission found was owed by Apple would be large.
The adverse Apple ruling has highlighted Ireland’s 12.5 per cent headline rate of corporate tax, one of the lowest in Europe. The commission said the Apple case had nothing to do with the 12.5 per cent rate and was based solely on the special arrangements the company had with the Irish revenue commissioners.
However, John McGuinness, the committee’s chairman, said Apple “employs thousands of people in Ireland and this ruling could have far-reaching implications for multinationals in this country”.
Ms Vestager said the commission was investigating around 1,000 tax rulings offered by European governments to companies concerning the amount of tax they owed. There were no further “open” investigations into tax arrangements in Ireland or elsewhere. She said two separate investigations into McDonald’s and Amazon were “a high priority” for the commission but that their timing depended on “the contact and co-operation we get”.