Apple Could Owe More Than $8 Billion in European Tax Probe

Apple-EUApple could owe more than $8 billion in back taxes if the European Commission finds issue with the iPhone maker's corporate tax policies in Ireland, according to analysis by Bloomberg Intelligence.

Apple is one of several multinational corporations that have been scrutinized for corporate tax avoidance in Europe over the past few years. The European Commission began Apple's tax probe in June 2014, and formally accused the iPhone maker of receiving illegal state aid from Ireland three months later.

The company's $64.1 billion in profit generated from 2004 to 2012 could be subject to a 12.5% tax rate, compared to its current foreign tax rate of about 1.8%, depending on the outcome of the investigation. A decision in the probe is expected in Brussels by March, possibly after the 2016 Irish election.

Bloomberg-Apple-Tax-Chart

Apple's tax breakdown in Ireland (Image: Bloomberg Intelligence)

Apple operates multiple subsidiary companies in Ireland to pay significantly less tax outside the U.S., where it earns about 55% of its revenue. Apple continues to deny any wrongdoing, and both the company and Ireland vow to take the European Commission to court over any negative verdict.

Last month, Apple agreed to pay 318 million euros in Italy to settle an investigation that accused the company of booking profits generated in Italy through an Irish subsidiary, in an effort to lower its taxable income base and save 879 million euros between 2008 and 2013. Italian regulators concluded that tax probe in March.

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Top Rated Comments

SoAnyway Avatar
129 months ago
Why does anyone defend a multi-billion dollar company from paying their taxes considering how much they benefit from the rest of society?

I'll never ever understand the conservative mindset, it's rather nutty.
Score: 65 Votes (Like | Disagree)
sransari Avatar
129 months ago
Why does anyone defend a multi-billion dollar company from paying their taxes considering how much they benefit from the rest of society?

I'll never ever understand the conservative mindset, it's rather nutty.
What I'll never understand is why it is considered greedy to want to keep money that you've earned, but it's NOT considered greedy for someone to take someone else's money that the earner has earned and the taker hasn't.
Score: 41 Votes (Like | Disagree)
justperry Avatar
129 months ago
The EU should really stick to what it does well and keep its hands off countries tax policies.
No, Apple should pay fair taxes in countries where they operate, now they don't.
Score: 40 Votes (Like | Disagree)
apolloa Avatar
129 months ago
The EU should really stick to what it does well and keep its hands off countries tax policies.
So the European Commission should not do its job and investigate issues in European countries? Ok..
Score: 29 Votes (Like | Disagree)
Gasu E. Avatar
129 months ago
The EU should really stick to what it does well and keep its hands off countries tax policies.
If countries join the EU, which is a free-trade zone, the EU has an interest in establishing consistent tax policies. Due to membership in the EU, a country such as Ireland is protected from having tariffs imposed on it by other EU countries; the EU gets those regulatory rights, in return. It's only fair and reasonable. If Ireland doesn't like it, they can leave the EU.
Score: 26 Votes (Like | Disagree)
d0minick Avatar
129 months ago
If they are breaking the law, make them pay. If they aren't, then fix the damn tax laws so they can bring the money home.
Score: 24 Votes (Like | Disagree)