Irish government to challenge Apple tax ruling

The Irish government has agreed to join Apple in fighting a Brussels ruling that the company enjoyed 25 years of illegal state aid in Ireland, allowing it to avoid billions in taxes.

Michael Noonan, the Irish finance minister, won a battle with junior partners in the coalition government over plans to lodge an appeal with the European Commission in the coming weeks.

Despite opposition from some independents, Mr Noonan won support for an appeal after promising that Ireland would launch a review into multinationals’ tax payments in Ireland.

Irish finance minister Michael Noonan
Irish finance minister Michael Noonan Credit: Reuters

Ireland could enjoy an enormous tax windfall if it chooses to enforce the Commission’s ruling but the government is keen to maintain the country’s status as a base for global companies’ European operations, which has created thousand of Irish jobs.

Apple has also vowed that it will appeal against Brussels. This week, Margrethe Vestager, the European Competition Commissioner, said two deals struck between Ireland and Apple in 1991 and 2007 amounted to illegal state aid, allowing the company to pay miniscule tax rates on its European profits.

Tim Cook
Tim Cook says Apple will appeal as well Credit: PA

After a two-year investigation, on Tuesday the Commission ruled that Ireland must seek €13bn (£11bn) for unpaid taxes stretching back as far as 2003.

Apple says it plans to bring its swelling overseas cash pile back to the US as early as next year, and pay taxes on its profits there. Earlier this week, the company’s chief executive Tim Cook accused Ms Vestager of making up her tax calculations and said the ruling was “political crap”.