Juncker says Apple ruling not meant to ′attack the USA′ | News | DW | 04.09.2016
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Juncker says Apple ruling not meant to 'attack the USA'

The European Commission chief has defended a decision to order Apple to pay billions of euros in back taxes to the Irish government. Brussels is reported to have launched a probe into similar fiscal arrangements.

On Sunday, European Commission President Jean-Claude Juncker said the decision to order the US tech giant Apple to pay back taxes to Ireland was the result of "intensive work which has been going on for many years."

Juncker - speaking to reporters at the G20 summit in China - denied that the order had been made in an effort to attack US interests, stressing that fair taxation was key in restoring trust in the global economy.

The commission's findings come amid growing tensions between Washington and Brussels over a number of EU anti-trust investigations involving major US firms such as Google, Amazon, McDonald's and Starbucks.

In its conclusion to the three-year investigation, the European Commission decided that the arrangement between the Irish government and Apple, which saw the firm pay levels of tax far below the official rate, constituted illegal state aid. Juncker said the order that Apple should pay back 13 billion euros ($14.5 billion) to Ireland's Treasury was about fairness.

"It would be absurd to choose this territory of state taxation to attack the USA," Juncker said, adding that most of the companies that the commission took punitive measures against were European.

Illegal tax sweetners?

Ireland, which plans to appeal the order, has attracted multinationals for many years, offering favorable tax deals to generate investment and employment. In 2014, Apple, which employs abour 6,000 people in the southern city of Cork, paid an effective corporate tax rate of just 0.005 percent on its European profits - equivalent to just 50 euros for every million it took in.

"Our rules on state aid have always been clear," Juncker said. "National authorities cannot give tax benefits to some companies and not to others. This is the leveled playing field that the commission has always worked to defend. We apply these rules without discrimination and without bias."

Apple's bill far exceeds the previous EU record for a state aid case: 1.3 billion euros ($1.45 billion) for the Nurburgring race track in Germany.

'Total political crap'

The decision to hit the firm with retrospective taxes was met with indignation from Apple and the US government. CEO Tim Cook described the ruling as "total political crap," and the White House decried a "unilateral" approach to rewriting global taxation norms.

On Friday, Austrian Chancellor Christian Kern complained that multinationals such as the coffee chain Starbucks and online retailer Amazon were paying less in his country than a typical Viennese sausage stall.

The European Commission has two outstanding cases involving two more US firms, Amazon and McDonald's, both in Luxembourg.

It is is also reportedly scrutinizing tax "opinions" - effective loopholes - that were granted to other multinationals in Ireland during the early 1990s, the same period that one was given to Apple.

rc/mkg (AFP, Reuters)