Was the EU's ruling on Apple's taxes in Ireland fair?

Article published on Aug. 31, 2016
Article published on Aug. 31, 2016

On Tuesday, the European Commission ruled that tech giant Apple must pay Ireland 13 billion euros in back taxes which it received in tax benefits from the Irish government. Both parties say they'll appeal the decision. But was it the first step to fairer taxation, or will the EU find itself at a disadvantage?

EU stands up to US -Tages-Anzeiger, Switzerland

With its decision, the European Commission has resisted the pressure from the US and set an example for other regions of the world, the Tages-Anzeiger comments: "African countries, states in the Middle East and also India may now take action, because they too missed out on taxes that Apple shifted to Ireland. But the biggest impact of the decision will be on relations with the US. Not long ago the US government openly threatened the EU with a tax dispute and warned it not to try to siphon off the profits made by US multinationals in Europe. It looks like the Treasury Department has become a self-appointed advocate of the multinationals and wants to prevent plans for the international coordination of business taxes. The first impression may be deceiving, but it seems that with its decision the EU Commission has come up with an effective answer to the Americans' bluff." (31/08/2016)

Even giants are not above the law - Pravda, Slovakia

Pravda welcomes the tax ruling against Apple: "The key message sent by the European Commission is: 'We'll get you'... Ireland may not be a tax haven but its tax rates are among the lowest... Apple has exploited this for years, paying only 0.005% taxes on its profits in Europe in 2014. The confrontation over this may go on for years. But the EU Commission has the European public, which pays its taxes without special benefits and is constantly tightening its belt for a better tomorrow, on its side. Meanwhile the governments are being held to ransom by huge companies that dictate their own laws and rules." (31/08/2016)

Harmonise taxes in Europe now - El Mundo, Spain

The Apple case faces the EU with a major decision regarding tax policy, El Mundo explains: "The 13 billion euros are not just a problem between the Irish government, Apple and Brussels. In an economic union like the European Union this affair affects the legislation of all the other member states too: it's about harmonisation... Regardless of what the judiciary rules, the Apple case underlines the need to make decisive progress in harmonising European taxes. Because there won't be a true economic union as long as governments are free to pursue a low-tax policy to attract investment. The EU member states should either adopt a uniform tax model that prevents cases like that of Apple or they should accept the fiscal sovereignty of the individual states with all the consequences this entails." (31/08/2016)

Ireland's image badly damaged - The Irish Times, Republic of Ireland

Ireland's reputation as a secure and predictable investment location hangs in the balance, the Irish Times fears: "Ireland has always presented itself as having a tax system with a clear legal underpinning, offering certainty to companies. Rightly or wrongly the judgment casts doubt over the way we taxed at least one major corporation – and this carries with it reputational damage for Ireland... The Government will argue - and there is a basis for this - that rule changes in recent years have closed off some of the tax arrangements central to the Apple case. However, the damning verdict by the commission on how tax was applied in the Apple case leaves the Government with little option but to lodge an appeal, given the central importance of foreign direct investment to our economy." (31/08/2016)

Brussels totally off the mark again - The Daily Telegraph, Great Britain

The EU Commission's decision is not only unwise but also presumptuous, the Daily Telegraph rails: "The European Commission's dealings with Apple and Ireland are a textbook example of what is wrong with the EU, both economically and politically. Economically, a punitive approach to the taxation of highly mobile international corporations is an act of self-harm: such firms can and will relocate to countries that do not seek to milk them for every penny of tax they can. Politically, it is an affront to democracy that the unelected Commission in Brussels should presume to dictate to Ireland's government what taxes it should levy. Nor is this an approach only applied to smaller states: last week, some EU leaders warned Britain against further cuts in corporation tax." (31/08/2016)

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