The competition authority of the European Commission demanded that the Apple co-pay taxes to the budget of Ireland of up to 13 billion euros ($ 14.5 billion). After three years of investigation, the Commission concluded that the agreement between Apple and Ireland, allows companies to minimize tax payments, violates EU laws on state aid. Calculate the amount of concrete (it would need to include interest) to be Dublin.
By the standards of the EU 13 billion euros - a record payout for tax violations, there is still a maximum of 1.4 billion euros - so much on the European Commission's decision was to return the French energy company EDF.
With two decisions of Dublin (from 1991 and 2007.) Apple had an opportunity in the period from 2003 to 2014 to pay to its European business tax 0.005% profit at a rate of up to 1% instead of the usual for Ireland 12.5%. Since the other company did not receive such preferences, the competition authority of the European Commission found a breach of EU laws agreed to grant state aid, canceled it and ordered Ireland to establish for two Irish units Apple - Apple Sales International and Apple Operations Europe - 12,5% -s income tax.
It is Apple Sales International, according to the newspaper The Wall Street Journal (WSJ), attracted the attention of the European Commission. This unit buys goods - for example, the iPhone - from the manufacturer, which produces its contract with Apple's, and sells retail outlets across Europe. In 2012, it earned $ 63.9 billion, the investigation showed the US Senate in 2013, reporting on the $ 91.5 billion profits accumulated outside the US, Apple specifies that "almost all of it," was formed in Ireland. The operating profit of the company outside the Americas for the nine months to end-June 2016 amounted to $ 41.73 billion, and most of it is, most likely, was obtained in the same Ireland, writes the WSJ.
Apple itself and the Irish Government did not agree with the conclusions of the European Commission. Irish Finance Minister Michael Noonan promised that he will ask the government's permission to challenge it in a court injunction, such as the plans of the general director of Apple Tim Cook.
There was a similar case
In 2015, the European Commission demanded from Starbucks and Fiat Chrysler to pay on the € 20-30 million, which they saved graceI benefits received from the Netherlands and Luxembourg respectively. The Company filed an appeal. The investigation continues with regard to Amazon.
Said Brussels effective tax rate Apple representative called Luca Maestri entirely fictitious example, in 2014 the company paid in Ireland $ 400 million in taxes.
Apple has become the largest taxpayer, not only in Ireland and the United States, but around the world, says Cook, in a letter released yesterday. He did not agree that Apple enjoyed the privileges of all these years, she, like other companies, has followed the recommendations of the Irish tax authorities. The situation is peculiar, says Cook: the company ordered to pay taxes to the government, which says that anything that does not.
In an effort to attract the large taxpayers, many countries are practicing the so-called tax harmonization, which set the rules for the taxation of specific companies, says partner EY Marina Belyakova. Luxembourg, the Netherlands, Ireland offered them favorable tax conditions, treating the individual rules of national tax law Vigodnym for these taxpayers way, she said. But in recent years the European Union has taken a course on "tax justice" and transparency: the tax inspection began coordination of a number of countries in terms of the EU rules on state support. Already completed the investigation on tax approvals Fiat (in Luxembourg) and Starbucks (in the Netherlands), part of the investigations still lasts, reminds Belyakova.
Apple used the differences in US law principles and Ireland, says KPMG partner Alice Melkonian. In the US tax residency is determined by the place of registration of the company, and in Ireland - at the place. In the case of Apple it turned out that most of the profits of one of its Irish "daughters" in the United States are not subject to tax because of non-American origin of this company, as in Ireland - since it was ruled by the United States, says Melkonyan. As a result, Ireland to levy taxes only to a small part of the profits. Apple Tax reconciliation with Ireland expected that most of the profits does not apply to Ireland, which means that Apple's effective tax rate in the country receive very low govoIT and Belyakov from EY.
The claim of the European Commission is to ensure that Apple received state aid from Ireland, inaccessible to other taxpayers, sums up senior lawyer at Herbert Smith Freehills Sergey Eremin.
The Treaty on the functioning of the European Union prohibits States from providing any form of state aid to companies that could create competition between the two countries, says partner Paragon Advice Group Alexander Zakharov. However, in proceedings between the EU treaty this point has never been used for the calculation of tax for past periods, says expert - although theoretically in this case it applies.
There is no doubt that the investigation and the conclusions of the European Commission and the impact on other companies that use similar schemes, Melkonyan is confident of KPMG. Under the eye can be any transnational corporations agree Zakharov of Paragon Advice Group. To demand 13 billion euros actually reduce the tax base for the US, which will be the subject of proceedings already between the EU and the United States, he suggests. Indeed, the US Treasury has criticized the European Commission last weekUIS for tax investigation as contrary by US authorities believe that the international norms that undermine progress in the global fight against tax evasion and contrary to the very principles of the European Commission.
Representatives of Fiat Chrysler and Starbucks did not respond to requests.