Final appeal hearings begin in Apple’s tax bill saga

The outcome of this latest appeal in the long-running case could have huge implications for future tax benefits for multinational companies.

The EU Court of Justice (EUCJ) today (May 23) began hearing an appeal in which the European Commission sought to overturn a 2020 ruling in favor of Apple and Ireland in what has become a seven-year battle.

The appeal concerns a €13 billion tax bill that the European Commission has declared to be illegal benefits provided by Ireland in 2016.

After a long battle between the Commission and Apple, along with Ireland, the EU’s General Court announced in 2020 that it would overturn a ruling requiring Apple to pay the bill, now with additional interest.

At the time, the court said the Commission “failed to demonstrate to the necessary legal standards that there is an advantage” gained by Apple’s operations by receiving equivalent state aid or better treatment than other companies.

At today’s hearing, European Commission lawyer Paul-John Lowenthal said the General Court had “confused and muddled” several legal issues, leading to a “legally flawed judgment”.

“Totally misleading”

However, Apple said EU Commissioner Margret Vestager’s team made legal mistakes when it concluded the tech giant had received unfair tax relief from Ireland and demanded the company return the money.

Apple lawyer Daniel Baird says: “The bottom line in this case is clear, the Commission simply misunderstood the facts of what was going on in Ireland.”

In fighting the appeal, the iPhone maker claims the multi-billion euro tax bill was not actually paid in Ireland, but paid elsewhere.

According to Beard, Apple currently pays about €20 billion in US tax on the same profits.

Ireland was also represented today fighting the appeal. Irish lawyer Paul Gallagher said some of the comments made by the European Commission were “totally misleading”.

“There is no basis for the commission’s decision and I would ask the court to uphold the very careful and exhaustive judgment of the High Court.”

This latest appeal is expected to last several days and is seen as the European Commission’s latest attempt to make an example out of Apple.

The final decision, which could take up to a year, could determine the future of significant tax breaks for multinationals from member states.

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