CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Ireland To Appeal EC's Apple Tax Ruling Decision

Ireland To Appeal EC's Apple Tax Ruling Decision

by Lorys Charalambous, Tax-News.com, Cyprus

13 September 2016


Ireland's Department of Finance has responded to the European Commission's conclusions of its investigation into a tax ruling handed by the Irish Government to technology giant Apple, stating that the full amount of tax was paid in this case and that no state aid was provided.

In a statement released on August 30, 2016, the Department pointed out that there is a "contradiction at the heart of the Commission's decision," stating: "While requiring Ireland to recover the tax sums, the Commission is also acknowledging that the sums may in fact be taxable in other jurisdictions. The Commission is incorrect to state that profits allocated to the Apple companies' head offices were not subject to tax in any country under a specific provision of the Irish tax law. This refers to a mismatch between different countries' tax rules, which by definition cannot be the responsibility of Ireland alone."

The Department said: "Ireland acknowledges and accepts that the Commission has a legitimate role, under the treaties, in enforcing competition rules. It is not appropriate that EU state aid competition rules are being used in this new and unprecedented way in the area of taxation, which is a member state competence and a fundamental matter of sovereignty. Ireland has very real concerns about the way in which the Commission is undermining the international consensus, impeding reform, and creating uncertainty for business and investment in Europe."

The Department went on to add that Ireland "is not alone in this view," adding that the US Treasury "has raised very important concerns in its recent White Paper on the Commission's state aid investigations." The US Treasury's paper, which was released on August 24, says that the Commission's approach undermines US tax treaties and international transfer pricing guidelines already accepted broadly in the global tax community, and undermines the work done as part of the base erosion and profit shifting project. It states that the Commission's approach is new and was unforeseeable by the relevant companies and EU member states.

The Department said that the Finance Minister will now seek Cabinet approval to appeal the Commission decision to the European Courts. Ireland will hold the recovery amount in escrow until the case has concluded given that it may ultimately have to be returned to the company in the event of a successful appeal, it said.

Reacting to the Commission's decision, Minister for Finance, Michael Noonan, said: "The decision leaves me with no choice but to seek Cabinet approval to appeal the decision before the European Courts. This is necessary to defend the integrity of our tax system; to provide tax certainty to business; and to challenge the encroachment of EU state aid rules into the sovereign member state competence of taxation. It is important that we send a strong message that Ireland remains an attractive and stable location of choice for long-term substantive investment."

TAGS: compliance | Finance | tax | investment | business | European Commission | tax compliance | Ireland | tax avoidance | mining | law | ministry of finance | multinationals | tax planning | transfer pricing | tax reform | trade | European Union (EU) | Europe | BEPS

To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »