Apple Forced to Pay $14.6B to EU

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With business comes ethical issues and behind-the-scenes transactions, in this case the Cupertino company has been doing business with Ireland for more than 10 years due to the low tax rate compared to other countries. That being said, the European Union has requested Apple to pay them in $14.6B in taxes that were not paid.

In today’s announcement by the European Commission, it was revealed that Apple had only paid a 1% tax rate in 2003 and eventually dropped to 0.005% in 2014. The issue here is that Ireland’s corporate tax rate is 12.5% and even in 2003, Apple had still been paying taxes well under the country’s requirement. Furthermore, the ruling stated that Ireland made an agreement with Apple to pay lower tax rates. This is a violation of the European Union state aid rules and that, “Member states cannot give tax benefits to selected companies”.

In response, Ireland has made it a point to appeal the ruling and Apple’s CEO Tim Cook has denied that the company has failed to accurately pay taxes and has stated, “there is no basis or fact in law”

Unfortunately if the ruling is true and everything is proved, not only will this be a detriment to Apple, but it will also be a huge detriment to American businesses both current and future and the relationship between them and the European Union.

 

Sources: AppleEuropean Commission

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