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As Apple continues to face a legal battle with the European Commission concerning the regulator's claim that Apple received illegal state aid from Ireland and owes billions in back taxes, the latest development has seen the Cupertino company decline an invitation to testify before a special committee on the tax evasion claims (via Reuters).
According to a letter to the European Parliament shared on Twitter today by Parliament member Sven Giegold, Apple said it "will not be able to participate in a public hearing" on the topic of tax evasion.
The company's senior director for European government affairs, Claire Thwaites, explained that while the company appeals the Commission's decision alleging state aid from Ireland, "it is important to ensure public commentary does not prejudice those proceedings."
This is rotten! #Apple refuses to testify before the special committee on tax evasion of the European Parliament. No company stands above democracy! We should now withdraw Apple's lobby badges to access to the Parliament! This is the company's letter: pic.twitter.com/U2I4G6jNp9 — Sven Giegold (@sven_giegold) June 1, 2018
Since the appeal is ongoing and likely to be heard at the General Court in the near future we will not be able to participate in a public hearing on this topic as it could be detrimental to the proceedings at the Court, and any potential appeals thereafter.
I'd like to emphasize that we have the deepest respect for the Committee, it's members and the important work you are undertaking. We would be happy to meet privately with you or other Committee members and address any questions you may have.
Despite Apple's appeal, the company has started paying the 13 billion euros in back taxes to the Irish government this month. Like the wording in Thwaites' letter today, Apple has remained adamant that the company follows the law and pays "every cent of tax" it owes "in every country" it operates. In the wake of the legal battle, Apple CEO Tim Cook called the decision "total political crap" back in 2016, saying that "the decision is wrong, and it's not based on law or facts, it's based on politics. And I think it's very important that we stand up and say that very loudly."
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Top Rated Comments
(View all)100% agree with Cook on this one. As long as they pay all taxes that are required, they should not be punished nor have to pay “back taxes”. Now if you want to say they are locating some of their business entities in countries with favorable tax policies to avoid paying as much as they would in some other locations, wel... of course they are. Let’s not lose sight of the fact that Apple exists to make money. They are a business. For those that would criticize them for paying as little as they can and taking advantage of every deduction, I ask do you pay more than you are required to in taxes to your government? I highly doubt it. You take all deductions you are entitled to. Same with Apple.
Except that they didn't pay all taxes that were required, hence why they owe $13 billion.I never really understood this story, and every time I try doing some research on it, I get bored really quickly.
Basically Ireland gave special tax deals to Apple in exchange for Apple opening more infrastructure in Ireland. The EU doesn't allow special deals and therefore forced Ireland to collect the unpaid taxes Apple should have owed.The gist of the story is the Apple is being accused of tax evasion, but all the parties involved, Ireland and Apple, says that they are paying the appropriate taxes. Ireland gave Apple a special tax deal that works out great for both parties, but the European Commission says it isn't fair?
I am sure it is much more complicated than that, but it seems to me that if Ireland wants to give special tax considerations that would benefit both the tax payer and the people of Ireland, I don't see where the problem is.
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This is the most interesting thing about the story:
They are allowed to do this, but there isn't a clear line between a special tax rate and an illegal state aid. The so called head office of Apple, which existed only on paper due to a weird irish special deal from 1991, made it possible to lower Apples tax rate in 2014 to 0.005% on global profits. It seems that the EU has a point when they call this a huge financial advantage. If this is an illegal state aid is now up to the court to the decide.
If Ireland wants give Apple a sweet deal by charging 0.005%, then Ireland has to give that deal to ALL foreign companies. Ireland only gave that deal to Apple, so that is considered "state aid."The line is clear.