On Tuesday, the European Commission ordered Apple to pay up to €13bn in Irish taxes. It had found that the US technology giant paid a rate of tax between 0.0005 per cent and 1 per cent on its European profits over the last decade, while the usual rate of corporation tax in Ireland is 12.5 per cent. EU “member states cannot give tax benefits to selected companies—this is illegal under EU state aid rules,” said European competition commissioner Margrethe Vestager. Both Apple and the Irish state are to appeal the decision.
Apple has warned that multinational investment in Europe could be hit by the commission’s move. In a letter to Customers Tim Cook, Apple’s chief executive, said “the most profound and harmful effect of this ruling will be on investment and job creation in Europe. Using the commission’s theory, every company in Ireland and across Europe is suddenly at risk of being subjected to taxes under laws that never existed.”