Apple told to pay £11bn after European Union tax investigation

Apple

Apple has been ordered to pay €13bn in unpaid taxes to the Irish government after the European Commission ruled that it had received illegal state aid.

The commission said a sweetheart tax deal between Apple and Ireland was anti-competitive, allowing the company to pay a tax rate as low as 0.005 per cent on its European profits for more than a decade.

Apple said the EU had tried to “rewrite history”. The company has been under investigation for two years by the EU, in the latest effort to clamp down on alleged tax avoidance by US multinationals.

Apple records much of its worldwide sales, including in the UK, in Ireland, and has built up a colossal cash pile it is yet to bring back to the US, where it is based.

The total amount that Apple may have to pay will depend on how the ruling is actually enforced. Other countries or US authorities may order the company to pay extra, which could reduce the sum allegedly owed to the state.

It said the company had paid an effective tax rate of between 1 % and 0.005 % between 2003 and 2014, with the rate diminishing over time, even as the company grew to the world’s biggest.

Apple said “The European Commission has launched an effort to rewrite Apple’s history in Europe, ignore Ireland’s tax laws and upend the international tax system in the process. The Commission’s case is not about how much Apple pays in taxes, it’s about which government collects the money.

Apple has made $47.8bn in profits in the last 12 months, so the order represents just over 100 days of its profits. It also represents just fewer than 7% of its $215bn overseas cash pile. The company’s shares were down 2pc in pre-market trading in New York.

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