Apple appeals Commission’s €13 billion tax ruling

Company claims there are many errors in the Commission’s ruling.

Apple appealed today to the General Court of the European Union, dissecting the European Commission’s August decision that the iPhone maker owed Ireland up to €13 billion in back taxes, plus interest.

The company claims the Commission made many errors in its ruling, a redacted copy of which was released today in Brussels. Apple, which has its European headquarters based in Cork, Ireland, refutes claims its Apple Sales International (ASI) subsidiary paid a tax rate as low as 0.005 percent. The company also disputes the Commission’s conclusion that no employees were involved in Apple Sales International’s business activities.

The Commission ruled that Ireland’s tax agreements with Apple amounted to illegal state aid because they were not available to all companies and therefore gave the iPhone maker an unfair edge over rivals.

ASI is part of Apple and these employees conducted business for ASI using a power of attorney, which is entirely legal and normal for global businesses, the company claimed.

Apple also challenges the Commission’s conclusions regarding the cost sharing arrangements among Apple’s subsidiaries, which determined where taxes were paid. Sharing development costs of its intellectual property does not mean Apple’s IP is in Ireland and all of its profits should be taxed there, the company said.

“If their opinion is allowed to stand, Apple would pay 40 percent of all the corporate income tax collected in Ireland, which is unprecedented and, far from leveling the playing field, selectively targets Apple. This has no basis in fact or law and we’re confident the ruling will be overturned,” the company said in a statement.