Apple faces setback in $14bn tax battle with EU
Apple and Ireland find themselves in a challenging position in their ongoing clash with the European Union's (EU) antitrust watchdog. The issue stems from a substantial $14 billion (Rs. 1.15 lakh crore) Irish tax bill. This tax bill has been at the center of the EU's crackdown on special fiscal deals granted to some of the world's most influential companies.
EU court adviser calls for a re-examination of Apple's victory
Advocate General Giovanni Pitruzzella of the EU Court of Justice issued an advisory opinion on November 9, suggesting that Apple's previous win in a lower EU court should be re-examined. This opinion adds a new layer of complexity to the case, and the top EU tribunal is expected to issue its binding ruling in the coming months.
Vestager's controversial move sparks outrage and legal battles
EU antitrust chief Margrethe Vestager, currently on temporary leave for a bid for the presidency of the European Investment Bank, initiated the controversy in 2016 by focusing on Apple's tax arrangements in Ireland. This move sparked outrage from Cupertino, California, where Apple is headquartered, all the way to the White House. The case stands as the most significant in Vestager's decade-long campaign for tax fairness, which has targeted other tech giants like Amazon.com and carmaker Stellantis NV's Fiat.
Apple's initial victory overturned as EU court questions decision
Despite winning an initial bid to overturn the EU's decision in 2020, Apple now faces a potential setback as the EU Court of Justice questions the validity of the lower court's ruling. Judges had previously found that the European Commission had made several errors, dealing a significant blow to Vestager's efforts in the high-profile tax case.
EU's state-aid rules remain a key element
While facing setbacks in specific cases, the EU courts have consistently upheld the commission's innovative use of state-aid rules to scrutinize companies' arrangements with member states. This approach, exemplified in the ongoing dispute with Apple, has fueled a broader push within the EU to close tax loopholes that enabled some multinational companies to legally pay less tax within the European bloc.
Road ahead for Apple, Ireland, and EU tax fairness
As the EU court of Justice prepares to issue its binding ruling in the coming months, the outcome will not only impact Apple and Ireland but also set a precedent for the broader campaign for tax fairness within the European Union. The case, officially designated as C-465/20 P, Commission v. Ireland and Others, remains a focal point in the ongoing global debate over corporate taxation and the responsibilities of multinational corporations.
