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'A marathon, not a sprint': European Commission says the fight over Apple tax and Ireland isn't over

Margrethe Vestager has said the EU would analyse yesterday’s judgement before deciding on an appeal.

Executive vice-president of the European Commission Margrethe Vestager.
Executive vice-president of the European Commission Margrethe Vestager.
Image: Stephanie Lecocq/PA

THE EU’S TOP competition official has vowed to fight on to make big companies pay more tax, after Brussels suffered a major legal defeat in a long-running tussle with Apple.

Margrethe Vestager, the EU’s competition commissioner, said the struggle against profit-shifting was a “marathon… on hilly ground” after the EU’s second highest court threw out a landmark 2016 EU order that Apple pay Ireland €13 billion in back taxes.

She said the European Commission, the EU’s executive branch, would analyse the judgement before deciding whether to take the case to the European Court of Justice, but vowed to keep pushing for companies to pay “their fair share of tax”.

“One thing is clear — the fight against aggressive tax planning is a marathon. This is not a sprint. And this marathon, well, it does take place on very hilly grounds,” Vestager told reporters in Brussels.

Ireland was accused of allowing the iPhone-maker to park revenue earned in Europe, Africa, the Middle East and India, sparing it almost any tax.

Brussels said this gave Apple an advantage over other companies, allowing it to avoid Irish taxes between 2003 and 2014 totaling around €13 billion, and argued it amounted to illegal “state aid” by Ireland.

Both Apple and the Irish government contested that finding and the General Court of the European Union yesterday found in their favour.

The Luxembourg-based court said the commission “did not succeed in showing the requisite legal standard that there was an advantage”.

Vestager said that the coronavirus crisis meant public funds raised through taxation were more important than ever before.

“Our state aid enforcement work continues. If member states give certain multinational companies, tax advantages not available to their rivals, this harms fair competition in the European Union,” she said.

“The goal is very simple: to ensure that all companies pay their fair share of tax. We need to put in place the right legislation to address loopholes to ensure transparency.”

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The European Commission has a little over two months to file an appeal.

The EU is trying to come up with ways recover more in taxes from digital giants where they do business, though this has been opposed by some European capitals.

Talks to come up with a new global tax system at the OECD have stalled due to opposition by the US.

© – AFP 2020 with reporting by Rónán Duffy

 

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