Apple has been ordered to pay €13 billion ($14.4bn) in unpaid taxes to the Irish state, in a court ruling that ended a decade-long battle between Europe and the tech giant.
In a judgment handed down on Tuesday, the European Court of Justice (ECJ) agreed with a European Commission ruling in 2016, which found that for more than 20 years Apple had enjoyed illegal tax benefits that generates state aid from the Irish government.
“The Court of Justice gives the final judgment on the matter and confirms the decision of the European Commission in 2016: Ireland provided unlawful aid to Apple, which Ireland is required to recover,” the court said in a statement .
“Today is a big win for European citizens and tax justice,” said Margrethe Vestager, the European competition commissioner, in a statement to X. “Ireland provided illegal aid to Apple.”
The Irish government said it would respect the court’s decision, pointing out that it was “merely historical”, saying it stemmed from revenues in 1991 and 2007 that were “no longer enforced,” as it introduced changes to its tax regime. “The Irish position has always been that Ireland does not give preferential tax treatment to any companies or taxpayers,” the government statement read.
Dr Stephen Daly, a reader in tax law at King’s College London, said he was “appalled” by the decision, which came after a long back-and-forth legal battle that saw the European General Court find in Apple’s favor in 2020.
“I really didn’t see this coming,” Daly said. “I thought the Commission’s path to victory was incredibly narrow because it suffered some major defeats in similar cases against Fiat and Amazon. I thought the result would be the same. I am also stunned because this is the biggest tax case in history: €13bn—which would be more than €14bn when interest is added—has to be returned.”
The case relates to tax deals made by Irish authorities with Apple in 1991 and 2007 to encourage it to headquarters two European subsidiaries in the country. Other companies were not offered the same favorable terms, leading the European Commission to accuse Ireland of giving Apple a “selective advantage.”
Ireland has long been under scrutiny for allegedly providing a tax haven for US companies. In his final stint in the White House, current presidential hopeful Donald Trump name-checked the country in a speech in which he pledged to return “trillions of dollars” in tax revenues to the US.
“For too long our tax code has encouraged companies to leave our country in search of lower tax rates,” he said in 2017. “It’s happening—many, many companies. They’re going to Ireland. They will be finished.”
According to Daly, the ECJ decision is “not good for Ireland.” “Ireland has always tried to position itself as a country that provides generous tax policies but policies that are fair,” he said. “It certainly hurt Ireland Inc.”
