Apple to begin repaying Irish tax bill next year

December 5, 2017 // 11:18 a.m.

Tags: #apple #european-commission #european-union #financial #ireland #irish-government #tax #taxes #tax-evasion #tax-minimisation

Apple has agreed a deal with the Irish government that will see it repay €13 billion in uncollected taxes, even as both parties continue to appeal against the ruling by the European Commission that the tax benefits given to the company were illegal under EU regulations.

The European Commission found Apple guilty of benefiting from illegal tax discounts and rebates supplied by the Irish government back in August 2016, applying to a pair of tax rulings made by the Irish government in 1991 and 2007 and which offered Apple the equivalent of a 0.005 percent corporation tax rate in 2014. Such hefty discounts applied only to a singular company, the EC found, run counter to European Union law - and the fact that the lion's share of Apple's profits in the region are attributed to its Irish head office can't have helped, given the Commission's opinion that 'these "head offices" existed only on paper and could not have generated such profits'.

Neither Apple nor the Irish government were pleased with the findings - the former being on the hook for a €13 billion bill for back taxes plus interest and the latter losing the very incentives that convinced Apple to site its headquarters there in the first place - and have since been dragging their feet over repayments while appealing the ruling. Now, though, Apple has been forced to agree repayment schedule with the Irish government that will see it begin to make a dent in the €13 billion debt starting early next year.

The Wall Street Journal reports that Apple's repayment of the back tax bill will begin early next year, with Apple placing the funds into an escrow account - a repository held by a trusted third-party company. This, it would appear, is a way for the company to hedge its bets: If the appeal fails the contents of the escrow account can be released to the Irish government, while if the appeal succeeds it can be returned to Apple.

'We have a dedicated team working diligently and expeditiously with Ireland on the process the European Commission has mandated,' Apple claimed in response to the WSJ's request for comment. 'We remain confident the General Court of the EU will overturn the Commission's decision once it has reviewed all the evidence.'


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