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Irish Parliament Backs Apple Ruling Appeal

by Jason Gorringe, Tax-News.com, London

09 September 2016


The Irish Parliament has backed a government motion in favor of an appeal against the European Commission's decision that tax rulings given to Apple constituted illegal state aid.

The motion was passed by 93 votes to 36. It stated that Parliament "supports the Government's decision to appeal the European Commission's decision that Ireland provided unlawful state aid to Apple." Finance Minister Michael Noonan described both the Commission's decision and the Government's appeal as "landmark moments for Ireland's tax policy and our place in Europe."

Noonan said the appeal is "necessary to defend the integrity of our tax system, to provide certainty to business, and to challenge the encroachment of EU state aid rules into the sovereign member state competence of taxation." He added that "it is simply untrue that Ireland provided favorable tax treatment to Ireland," and warned that "it is very damaging for our reputation to be called into question."

The Commission last month concluded that two tax rulings issued by Ireland to Apple have substantially and artificially lowered the tax paid by Apple in Ireland since 1991. It ordered Ireland to recover "unpaid taxes" from Apple for the years 2003-2014 of up to EUR13bn (USD14.7bn), plus interest. The Government will hold the recovery amount in escrow until the case has been concluded, as it may ultimately be returned to the company in the event of a successful appeal.

Speaking during the parliamentary debate, Prime Minister Enda Kenny said the Commission's decision "is so profoundly wrong and damaging that it demands an immediate, clear, and strong case."

"Governments over the years have made clear, as this Government has, that Ireland did not and does not do deals with corporates, large or small. It is not how we do business. It is not true that Apple was provided with more favorable treatment than others. There was no preference shown. The law was applied fully and appropriately and Apple paid its taxes due in Ireland," he explained.

There were three additional clauses to the Government motion. They stated that the Parliament: commits itself to the "highest international standards in transparency in the taxation of the corporate sector; resolves that "no company or individual receives preferential tax treatment;" and affirms its commitment "to the 12.5 percent corporation tax rate, the research and development tax credit, and the Knowledge Development Box, and affirms its view that taxation is a competence for member states as set out in the EU treaties."

TAGS: compliance | tax | business | European Commission | tax compliance | Ireland | interest | law | corporation tax | ministry of finance | multinationals | tax planning | transfer pricing | tax rates | tax breaks | standards | telecoms | European Union (EU) | research and development | Europe

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