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Thursday 20 September 2018

Government will begin collecting €13bn Apple tax bill early next year

Minister Paschal Donohoe. Photo: Steve Humphreys
Minister Paschal Donohoe. Photo: Steve Humphreys

Sarah Collins

The Government will start to collect around €13bn in disputed back taxes from US tech giant Apple early next year.

Finance Minister Paschal Donohoe has said he will put out to tender for a firm to manage the money in January and hopes to collect it "across the first quarter" of 2018.

The announcement comes two months after the European Commission said it would sue the Government for not collecting the money quickly enough. Under EU rules, it should have been gathered by January 3, 2017.

This comes a full 15 months after the EU found that Apple had enjoyed decades of illegal tax breaks in Ireland.

The Government and Apple have both appealed that decision.

However, EU rules say the money has to be held in trust until the case is finished, which could take years.

The EU has said it will not withdraw its complaint over delays in recovering the money before it is paid back in full.

"We hope that we can work constructively with the Irish authorities to make sure that recovery is completed as soon as possible," said a commission spokesperson, adding: "That would also allow us to close this procedure."

EU officials point to similar cases concerning Starbucks in the Netherlands and Fiat in Luxembourg, where the money was recovered more quickly.

But Mr Donohoe said the Apple case was more "difficult", given the "scale of the fund and the uniqueness of this issue". He added that the Government was making "significant progress".

Ahead of a meeting with EU competition chief Margrethe Vestager in Brussels yesterday, Mr Donohoe said Ireland was committed to "defending" its position in court.

"Across the period in which we are defending the ruling, we will be complying with our obligations in terms of collecting the money from Apple," the Finance Minister told reporters.

He said he would be able to give more detail on the final amount to be collected later this month.

A spokesperson for Apple said that it was working "diligently and expeditiously with Ireland on the process" and that it was "confident" the court would overturn the EU's August 2016 finding.

The Commission said at that time that Ireland had offered massive tax breaks to Apple, allowing it to pay as little as 0.005pc tax one year, well below Ireland's 12.5pc corporate tax rate.

In October, it took the Government to court for failing to claw back any money, a decision which the Department of Finance said at the time was "extremely regrettable".

The commission said Ireland acted illegally by giving Apple benefits that amounted to unfair competition.

"The commission's case against Ireland has never been about how much Apple pays in taxes, it's about which government gets the money," Apple said in a written statement.

"The United States government and the Irish Government both agree that we've paid our taxes according to the law," it added.

Irish Independent

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