EU to scrap legal action as Apple pays €13bn back-tax

EU to scrap legal action as Apple pays €13bn back-tax

Foo Yun Chee and Padraic Halpin

The EU regulator's plans to drop legal action against Ireland after iPhone maker Apple paid €13.1bn in back taxes following a regulatory order two years ago, the European Commission has said.

Competition Commissioner Margrethe Vestager sued Ireland last year for failing to recover the record amount.

“In light of the full payment by Apple of the illegal State aid it had received from Ireland, Commissioner Vestager will be proposing to the college of commissioners the withdrawal of this court action,” said commission spokesman Ricardo Cardoso.

The Department of Finance, here, yesterday announced that it had fully recovered the €13.1bn in disputed taxes from Apple, plus interest of €1.2bn, which it will hold in an escrow fund pending its appeal against the EU tax ruling, Ireland’s finance minister said on Tuesday.

The European commission ruled in August 2016 that Apple had received unfair tax incentives. Both Apple and Dublin are appealing against the original ruling, saying the iPhone maker’s tax treatment was in line with Irish and EU law.

Finance Minister Paschal Donohoe said the case had been granted priority status and is progressing through the various

stages of private written proceedings before Europe’s second highest court. The matter will likely take several years to be settled by the European courts.

“While the Government fundamentally disagrees with the commission’s analysis in the Apple state aid decision, and is seeking an annulment of that decision in the European courts, as committed members of the European Union we have always confirmed that we would recover the alleged State aid. We have demonstrated this with the recovery of the alleged State aid which will be held in the escrow fund pending the outcome of the appeal process before the European courts,” said Mr Donohoe.

“This is the largest State aid recovery at around €14.3bn and one of the largest funds of its kind to be established. It has taken time to establish the infrastructure and legal framework around the escrow fund but this was essential to protect the interests of all parties to the agreement,” he said.

Additional reporting Irish Examiner

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