After months of speculation, Apple has finally fired back at the European Commission. The Cupertino giant has filed an appeal against their €13 billion (approx Rs. $14.5 billion) tax ruling for its activities in Ireland. It has basically mentioned that the EU’s allegations are unjust and they’ve made a “fundamental error” in their ruling against them.
Apple had appealed against the European Commission’s decision back in December last year, as had been speculated by analysts. The general opinion at that moment of time was that EU had singled out Apple because of its success in the country. But, the Cupertino has relied on fourteen pleas to put their viewpoint across to the Commission. An outline of their plea application has been published in the Official Journal of the European Union.
The said plea primarily contests the fact that they’re not liable to any back taxes because “the Cork, Ireland, headquarters of Apple’s European wing was properly set up, in accordance with all regulations and laws.” And also because it is not the primary center of operation for the company, it argues that a bulk of their profits are due in the United States. It further also points out that the EC has given more weight to their Irish operations that it really should.
Talking about the same, Apple’s ruling reads:
The Commission made fundamental errors by failing to recognize that the applicants’ profit-driving activities, in particular the development and commercialization of the intellectual property (Apple IP), were controlled and managed in the United States. The profits from those activities are attributable to the United States, not Ireland.
Thus, the taxable income attributed to their headquarters in Ireland are misrepresented and are being calculated on the basis of their worldwide profits. It means to say that the European Commission has failed to conduct an impartial and diligent investigation of the allegations for their tax arrangements in the country. The decision is being wholly supported by the Irish Government, who disagrees with the findings and resists the acceptance of outstanding taxes.
Further, Apple has also accused the European Commission for their apparent accounting blunders and persistent comparisons to tax arrangement of other technology giants operating in the region. The Cupertino giant added that EC is trying to exceed its competence by attempting to interfere and redesign Ireland’s corporate tax regime.
Earrlier last year, the European Commission had instructed Apple to shell out a hefty $14.5 billion in outstanding taxes and interests to the Irish government. They alleged the Cupertino giant of cutting tax deals with the government while setting up their EU headquarter in the country.