European Commission Hates Tax Competition

apple-jobs x540

Apple has been in Ireland for 36 years, pictured above is Steve Jobs at the opening of Apple’s Cork campus in 1980. The idea that Apple Ireland is some kind of boilerplate operation is nonsense, it employs some 6,000 staff. The Irish Development Agency estimates a further 18,000 jobs depend on Apple, it adds many millions to the Irish treasury every year. When it completes the €850 million Athenry data centre Apple’s investments in Ireland will total over a billion euros. 

Ireland wins foreign investment for three reasons; the highly educated, young, English speaking workforce, the pro-business, low-tax environment and that it is an entrepot to Europe. The European Commission despises the high-growth, low tax competitor on the periphery of the European Union. Ireland knows that it is the trump card played to foreign investors. Instead of competing, the EC wants to snuff out the low tax competitor.

Apple's Cork Campus

Officials in Brussels have long complained about Ireland’s tax competition, that Twitter, Google, Apple and other US tech giants prefer to put their European HQs in Dublin rather than on the continent. Only Luxembourg competes on tax (e.g. Amazon, Guardian Media Group and AOL/Huffington Post). So far Guido has not noticed the Commission going after Juncker’s homeland…

Apple itself argues

The European Commission has launched an effort to rewrite Apple’s history in Europe, ignore Ireland’s tax laws and upend the international tax system in the process. The opinion issued on August 30th alleges that Ireland gave Apple a special deal on our taxes. This claim has no basis in fact or in law. We never asked for, nor did we receive, any special deals. We now find ourselves in the unusual position of being ordered to retroactively pay additional taxes to a government that says we don’t owe them any more than we’ve already paid.

The Commission’s move is unprecedented and it has serious, wide-reaching implications. It is effectively proposing to replace Irish tax laws with a view of what the Commission thinks the law should have been. This would strike a devastating blow to the sovereignty of EU member states over their own tax matters, and to the principle of certainty of law in Europe. Ireland has said they plan to appeal the Commission’s ruling and Apple will do the same. We are confident that the Commission’s order will be reversed.

In 2009 the Commission during the Lisbon II Treaty referendum guaranteed not to interfere in Ireland’s tax affairs. The EU has no tax competency, so it is instead using competition policy to extend its reach and claiming that this is “illegal under EU state aid rules, because it allowed Apple to pay substantially less tax than other businesses. Ireland must now recover the illegal aid.” In fact all businesses in Apples circumstances are treated the same under Irish tax law. This ain’t over…




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