EU to accuse Apple of taking illicit Irish state aid

GMT 15:07 2014 Monday ,29 September

Arab Today, arab today EU to accuse Apple of taking illicit Irish state aid

EU to accuse Apple
Brussels - AFP

The European Union said it will unveil on Tuesday details of investigations into sweetheart tax deals for Apple amid reports it will accuse the US tech giant of getting illegal state aid.
The probe into Apple's tax affairs in Ireland, where it has for years enjoyed an effective rate of less than 2.0 percent, found the schemes gave the company an unfair competitive advantage, the Financial Times and Wall Street Journal reported.
The EU launched an investigation in June into tax deals negotiated by Apple, Fiat and Starbucks with Ireland, Luxembourg and the Netherlands, the latest in a series of clashes between Brussels and multinational firms.
Apple and other giants including Amazon have come under intense pressure from politicians and campaigners over their tax dealings, with critics saying the arrangements allow companies to move billions in earnings from higher taxed countries to lower taxed ones.
The European Commission, the executive branch of the 28-nation EU, will take the next formal step against Apple by publishing on Tuesday the full reasons behind June's decision to open the investigation, a spokesman said.
It will also publish details of the decision to open the investigation into Italian automaker Fiat's tax deals on Tuesday, but not on the Starbucks decision.
"It will set out the Commission's reasons for opening the investigation in more detail. All decisions of this type are published," Antoine Colombani, a spokesman for Competition Commissioner Joaquin Almunia, told a daily briefing.
A few weeks later, the decision will be published in the EU's official journal and all the parties involved will then have a month to submit their comments, he said.
"We continue to investigate this case. We do not have any findings to communicate at this point in time," Colombani added.
- Ireland 'confident' no breach -
Ireland's Department of Finance confirmed that the EU would be publishing a document on the Apple investigation but stressed that "the Commission has not formally decided that there is state aid" at play.
"Ireland is confident that there is no breach of state aid rules in this case and has already issued a formal response to the Commission earlier this month, addressing in detail the concerns and some misunderstandings contained in the opening decision," the department added.
The EU investigations seek to determine whether such arrangements offered by Ireland, the Netherlands and Luxembourg give the companies an unfair competitive advantage and thus amount to illegal state aid.
Ireland is favoured as a European base by several major companies including Amazon, Facebook, PayPal and Twitter.
Apple's European headquarters is in the southwest Irish city of Cork, where it employs 4,000 people.
The country has a competitive corporate tax rate of 12.5 percent, which has been criticised by some other member states of the EU as unfair, but which Dublin has repeatedly defended.
A 2013 investigation by the US Senate found the maker of iPhones and iPads paid a lower rate by channelling overseas sales through subsidiaries in a deal negotiated with the Irish government.
The Organisation for Economic Cooperation and Development (OECD) this month began efforts to crack down on "aggressive" tax avoidance by multinational companies.
Ireland has indicated that such loopholes could be closed amid pressure from the OECD.



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