Chethma De Mel, Jadetimes Staff
C. J. De Mel is a Jadetimes news reporter covering Entertainment News
The European Court of Justice (ECJ) has ordered Apple to pay €13bn (£11bn; $14bn) in unpaid taxes to Ireland. This marks the final decision in a case that began eight years ago when the European Commission accused Ireland of providing Apple with illegal tax advantages. Ireland has consistently contested the Commission’s claim, but the ECJ’s ruling affirms that the country granted unlawful aid to Apple, which must now be recovered.
Apple and European Commission Clash Over Tax Rules
Apple expressed disappointment with the ruling, accusing the European Commission of attempting to retroactively change the rules. The company maintained that the case wasn't about the amount of taxes owed but about which country Apple was required to pay. It emphasized that its income was already taxed under U.S. law, asserting that it has always paid all taxes owed wherever it operates.
A Prolonged Legal Battle
The ruling stems from a decision issued by the European Commission in 2016, which covered tax arrangements from 1991 to 2014. The Commission argued that Apple received favorable treatment from Ireland, granting it advantages that other companies could not access. In 2020, a lower court overturned the Commission’s ruling after an appeal by Ireland. However, the ECJ has now set aside that verdict, citing legal errors in the lower court's decision.
Ireland’s Reluctance to Collect the Tax
Despite the ruling, Ireland has spent years resisting efforts to recover the taxes from Apple. The Irish government argued that the favorable tax arrangements made the country an attractive hub for large corporations like Apple, which bases its European, Middle Eastern, and African operations there. Ireland’s low corporate tax rate has been a significant factor in this strategy.
Victory for the European Commission
The ECJ’s decision represents a major win for the European Commission, which has been working to crack down on large corporations using complex financial strategies to reduce their tax obligations. The ruling reinforces the Commission’s power to regulate state aid and prevent unfair advantages for companies.
Google Fined for Market Abuse
In a separate case, Google was ordered to pay a €2.4bn fine for abusing the market dominance of its shopping comparison service. The ruling concludes a long-running legal battle that began in 2017 when the European Commission first imposed the fine. Google had appealed the decision but lost, despite making changes to its service in response to the Commission’s findings. The ruling underscores the European Union’s determination to regulate the behavior of tech giants.
A Costly Day for Tech Giants
The ECJ rulings against Apple and Google mark significant victories for the European Commission in its efforts to hold major corporations accountable for their business practices. Both cases highlight the EU’s resolve to enforce strict regulations, particularly when it comes to taxation and market competition, setting a strong precedent for future cases involving multinational tech companies.
