On Friday 2 September, the Irish government decided to appeal against the European Commission’s decision that it recuperate €13 billon of unlawful tax benefits over ten years from US company Apple. The BBC says a motion to this effect will be submitted to the country’s parliament on Wednesday 7 September to validate the decision.
Earlier in the week, Irish finance minister Michael Noonan said that challenging the decision at the European Court of Justice would be necessary to defend the integrity of Ireland’s tax system, fiscal certainty for companies and to challenge the way EU state aid rules trample on countries’ sovereignty when it comes to taxation (see EUROPE 11612).
The European Commission has rebutted former Competition and then Digital Economy Commissioner Neelie Kroes. In an article in The Guardian, the former commissioner, currently member of the advisory committee for US company Uber, said that these state aid investigations had introduced legal uncertainty into company taxation. In order to tackle aggressive tax avoidance "you cannot change the rules of the game through ad hoc state aid enforcement, and then seek retroactive recovery for unpaid taxes. Doing so would be fundamentally unfair and would harm competition, growth and tax income in Europe" wrote Neelie Kroes, adding: "Rather than pursuing a handful of countries and companies for the past, we should focus on shaping a fair tax system for the future. The controversy about state aid and tax rulings is not about whether companies pay their fair share, but where that share should be paid. That is an important question, but not one for state aid".
Quizzed about this, European Commission spokesperson Margaritis Schinas said: "We understand it may be sometimes challenging to reconcile the role as a former commissioner with the temptation to publicly express the views of those in Silicon Valley or elsewhere who oppose the European Commission decision. This seems to criticise the way the European Commission applied EU state aid rules. The fact is, they were not applied in the way it has been alleged (…) and if it was up to her, the non-confidential version of the Apple decision would have been published yesterday for the world to see" but the Commission is waiting for the go-ahead from the Irish authorities.
Rosa Pavanelli of the Internationale des Services Publics said that the European Commission’s decision showed that if they had an ounce of political will, governments would in fact have access to funds to allow the financing of public services such as healthcare, education and access to water. She said that the amount that Apple has to repay was the equivalent of Ireland’s annual budget for healthcare. (Original version in French by Élodie Lamer)