Vestager, who ends her term in November, has made a name for herself going after Big Tech’s tax arrangements with some EU countries and attempts to stifle smaller rivals.
“Today is a huge win for European citizens and tax justice,” she said on X of the Apple ruling, also praising the Google judgment as a big win for digital fairness.
The Luxembourg-based Court of Justice of the European Union sided with Vestager.
“The Court of Justice gives final judgment in the matter and confirms the European Commission’s 2016 decision: Ireland granted Apple unlawful aid which Ireland is required to recover,” judges said.
They said Apple’s two units incorporated in Ireland enjoyed favourable tax treatment compared to resident companies taxed in Ireland which are not capable of benefiting from such advance rulings by the Irish tax authorities.
“The European Commission is trying to retroactively change the rules and ignore that, as required by international tax law, our income was already subject to taxes in the U.S.,” Apple said.
Ireland, whose low tax rates helped it to attract Big Tech to set up their European headquarters, had also challenged the EU ruling, saying its tax treatment of intellectual property transactions is in line with other OECD countries.
Google has racked up 8.25 billion euros in EU antitrust fines in the last decade.
It has challenged two rulings involving its Android mobile operating system and AdSense advertising service, and is now waiting for the judgments.
The cases are C-465/20 P Commission v Ireland and Others and C-48/22 P Google and Alphabet v Commission (Google Shopping).
Vestager has established a reputation for herself by challenging Big Tech’s tax agreements with certain EU nations and by trying to suppress smaller competitors. Her term expires in November. Her successor might be encouraged to adopt a similar strategy by the court victories.
The head of EU antitrust praised the rulings. Speaking on point X of the Apple ruling, she praised the Google ruling as a significant victory for digital justice and declared, “Today is a huge win for European citizens and tax justice.”.
The iPhone maker benefited from two Irish tax rulings for over 20 years, which artificially reduced its tax burden to as low as 0 point005 percent in 2014. According to the European Commission, which ordered Apple to pay back taxes to Ireland in 2016, the company owed 13 billion euros ($14.4 billion).
The Court of Justice of the European Union, situated in Luxembourg, took Vestager’s side.
“The Court of Justice renders a final ruling in this case and upholds the 2016 ruling of the European Commission: Ireland gave Apple illegal aid, which Ireland must repay,” the judges declared.
As opposed to resident companies that are subject to Irish taxation and are not eligible for such advance rulings from the Irish tax authorities, they claimed that Apple’s two Irish-incorporated units received preferential tax treatment.
In accordance with Irish tax laws during the 2003–2014 timeframe examined by the EU, Apple claimed to have paid $577 million in taxes, or 12.5% of its total profits, and expressed disappointment with the decision.
In defiance of international tax law, the European Commission is attempting to amend the regulations retroactively and is ignoring the fact that our income was already taxed in the U.S. s. “Apple stated.
In a separate statement, Apple stated in a regulatory filing that it anticipated recording a one-time income tax charge in its fiscal fourth quarter, which ends in September, of up to roughly $10 billion. 28.
Ireland had also contested the EU ruling, arguing that its tax treatment of intellectual property transactions is consistent with other OECD countries. Ireland’s low tax rates helped the country draw in Big Tech to locate their European headquarters.
Nevertheless, it has contributed to the revision of international corporate tax laws and made the previously unimaginable decision to abandon its cherished 12.5 percent corporate tax rate. However, since then, it has actually received more taxes from international corporations.
Judges declared, “Google’s conduct was discriminatory and did not fall within the scope of competition on the merits, given the characteristics of the market and the particular circumstances of the case.”.
Google expressed their displeasure with the decision.
“This ruling is based on a very particular set of circumstances. According to a spokesman, “We made adjustments back in 2017 to comply with the European Commission’s decision.”.
Using its own price comparison shopping service to give itself an unfair advantage over smaller European competitors, the world’s most popular internet search engine was fined by the Commission in 2017.
You cannot appeal either of the final rulings.
The cases in question are C-48/22 P Google and Alphabet v. Commission (Google Shopping) and C-465/20 P Commission v. Ireland and Others.
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Jan Harvey and Charlotte Van Campenhout edited the additional reporting. Additional reporting was done in Bengaluru by Deborah Sophia, in Dublin by Conor Humphries, and in Brussels by Marine Strauss.
