The EU Antitrust Commissioner, Margrethe Vestager, ordered Ireland to recover €13 billion unpaid taxes from Apple. The company established its EU headquarters in Ireland and got tax benefits that are considered illegal under EU state aid rules.
Vestager noted that Apple had been taxed at an effective rate of 0.005 %, equal to 50 € every Million € of profits. She stressed that 13 Billion € is not a penalty inflicted against Apple but it is unpaid taxes that the company owes.
The chairman of the European Digital SME Alliance, Oliver Grün, reacted saying “We applaud the Commission decision. European digital SMEs want to compete on a level playing field with their US competitors. It is unacceptable that SMEs pay up to 40% tax on profits, while multinationals are offered deals to pay virtually no tax at all. We call on the European Commission to put an end to these unfair competition practices.”
Besides Apple in Ireland, other EU investigations against multinationals concern Amazon, Starbucks, McDonald’s and Fiat Chrysler Automobile that allegedly got sweetheart tax deals in several Member States. Even, the US government recently intervened in support of the multinationals. On 24 August, the US Department of Treasury published a white paper) requesting the Commission not to seek retroactive recovery from multinationals and stating that such approach was inconsistent with International Norms. Despite the US pressure, today’s Commission decision is expected to set a fundamental precedent against tax avoidance by multinationals.
Grün concluded, “Special low tax rates offered by national governments to multinationals are a slap to the European economy, especially to SMEs. Indeed, they generate some employment and additional tax income in specific countries, but they slay the chances of SMEs to compete and grow. This is a shortsighted behavior that will eventually harm European citizens and companies, alike. Today’s Commission decision is an important step for Europe to support its SMEs ”
Source: European Digital SME Alliance