EU Sues Apple With Massive $14 Billion Tax Evasion Lawsuit
Apple may be required to pay $14 billion in taxes to Ireland as a 2020 court order was found to have legal errors. The European Court of Justice (ECJ) determined that the EU General Court had made several legal mistakes and has instructed a reconsideration of its decision.
Three years ago, Apple was acquitted of exploiting a legal loophole that enabled the company to evade $14 billion in taxes owed in Ireland from 2003 to 2014.
In 2016, the European Commission accused Apple of receiving preferential treatment and enjoying tax cuts in Ireland, with the company being subjected to a 1% corporate tax rate instead of the standard 12.5%, contravening EU fair competition rules. Legal proceedings ensued, but the General Court of the European Union nullified the Commission's decision to impose retroactive taxes.
Apple contested the ruling, and in 2020, the EU's General Court upheld the challenge, asserting that regulators had not satisfied the legal criteria to demonstrate that Apple had gained an unjust advantage.
A decision on the new ruling is anticipated in the upcoming months. The ECJ clarified that tax laws are not under consideration in this discussion. Ireland's finance minister, Michael McGrath, asserted in a statement that his country has never extended state aid to Apple.
Previously, Apple had to remit the full amount, and the funds were placed in an escrow account. Currently, both parties must await the General Court's revised decision before advancing with the payment and concluding this matter.
An Apple spokesperson said:
We thank the court for its time and ongoing consideration in this case. The General Court's ruling was very clear that Apple received no selective advantage and no state aid, and we believe that should be upheld.