The European Court of Justice has ordered Apple to pay $14.4 billion in back taxes to Ireland, marking a significant victory for the European Commission's crackdown on tax avoidance. The ruling supports the 2016 decision that found Ireland gave Apple unlawful tax benefits, reducing its tax rate to 0.005%.
Apple has been ordered to pay $14.4 billion in back taxes to Ireland following a European Court of Justice ruling. The case, originating from a 2016 European Commission decision, found that Ireland had provided Apple with unlawful tax benefits. These benefits allowed Apple to reduce its tax burden to as low as 0.005% in 2014 through special arrangements. The ruling marks a victory for EU regulators aiming to prevent multinationals from exploiting favorable tax deals within the region.
Apple, disappointed with the decision, argued that the European Commission is retroactively changing tax rules. It noted that its income had already been taxed in the U.S., adhering to international tax laws. However, the court upheld the European Commission's order, requiring Ireland to recover the unpaid taxes. This final ruling cannot be appealed.
The judgment sets a precedent for other EU nations to scrutinize their tax arrangements with large corporations, potentially leading to billions in tax recoveries across the bloc. For Ireland, this case could lead to further discussions on tax incentives and their impact on international business.
