Apple to start €13bn EU tax row repayments next month
The Government has said that it expects to receive the €13bn the EU says it is owed by Apple by the end of September.
And the appeal by Apple and Ireland against that tax ruling is likely to be heard before the end of the year, Finance Minister Paschal Donohoe said yesterday.
The European Commission has ordered Ireland to collect €13bn from Apple for what it has ruled are unpaid taxes.
After lengthy delays in setting up an escrow structure to hold the cash, Mr Donohoe said a structure agreed with Apple is now in place and he expects a first payment to be made next month, and the full amount to be collected by the end of September.
The Government and Apple say the tax was never owed and have appealed the ruling.
However, that could take several years and, in the meantime, the State must collect the tax and hold onto it."We expect the appeal is likely to begin in the autumn," Mr Donohoe said.
"How long the hearings will last will depend on the judges overseeing it and could be open to either party after that to take any further action," he said.
If Ireland wins its case, it will hand the €13bn back to Apple.
Describing yesterday's agreement with Apple as a "significant milestone", Mr Donohoe said the 'Escrow Framework Deed' will govern the collection and eventual payment of funds.
"The challenge, of course, is that this is a very large amount of money, and in the current environment of low interest rates and yields that we are in, decisions in relation to where this money is going to be invested will require very careful work on behalf of our investment manager," he said. "It is our shared view that we need to be making investment decisions that are low-risk and ensure all of this money is available when the process with the European Union comes to an end."
He went on to say that the key feature was to ensure that the taxpayer was protected.
The signing of the agreement follows a recent announcement that Bank of New York Mellon had been selected as the preferred tender for the provision of escrow agency and custodian services. Amundi, BlackRock Investment Management and Goldman Sachs Asset Management are preferred tenders to provide investment management services.
Payments into the escrow will consist of a series of consecutive tranche payments. If Apple wins the case, Mr Donohoe said, there is an agreement on how loses or gains are managed. So far, the cost to the Government in fighting the case has reached €3m.