European Commission takes Ireland to court for failing to collect taxes from Apple
Confirming an earlier report, the European Commission on Wednesday said it will bring Ireland to the European Court of Justice for failing to collect at least $15 billion in back taxes from Apple, which were originally due Jan. 3.
"More than one year after the Commission adopted this decision, Ireland has still not recovered the money," Competition Commissioner Margrethe Vestager said in a statement heard by Reuters. "We of course understand that recovery in certain cases may be more complex than in others, and we are always ready to assist. But member states need to make sufficient progress to restore competition."
She noted that in similar tax cases such as Fiat in Luxembourg and Starbucks in the Netherlands, money was recovered before appeals were exhausted — in those circumstances though, far less money was involved.
Vestager refused to comment on potential penalties, but the Irish government will likely face a fine if it loses at court.
Ireland's finance ministry on Wednesday said that it has been contact with Apple and the Commission for over a year, and is close to setting up an escrow account which would hold Apple's money pending the outcome of a government appeal. Apple is also appealing.
"It is extremely regrettable that the Commission has taken this action, especially in relation to a case with such a large scale recovery amount," the finance ministry said in a statement.
In August 2016, the Commission ruled that Ireland had extended illegal state aid to Apple, offering preferential terms that allowed the iPhone maker to pay miniscule amounts — as little as 0.005 percent in 2014 — despite funneling billions in international revenue through the country. E.U. law stipulates that benefits available to one company must be offered to all.
Ireland has maintained that it offered the same terms to other businesses, while Apple has repeatedly stated that it follows the law in every country it operates in. The laws themselves are in question, however.