Accused Apple to Owe $17 Billion
Tax experts too agree that the manner in which Apple has been taxed is far too liberal and cannot be substantiated by any accounting standards
Implying a clearly negotiated payment. The European Commission termed the special deal as unlawful as it not only offered selective treatment to Apple, but created unfair advantage for Ireland over other European Union member countries. Multinationals maneuvering money in such tax shelters as Ireland denies governments of rightful money required to run public services.
A European Commission report claims that Apple has received unfair tax subsidies from Ireland. Apple has been paying a tax rate of merely 2% over the last two decades in this allegedly “illegal” agreement.
Last year the technology giant paid £11.4 million ($18.46 million) in British corporation tax in spite of £10.5 billion ($17 billion) sales.
Apple, which channels billion dollar sales of its high-end devices through Ireland to reduce its UK tax liabilities, faces a potential penalty of $17 billion.
The lower tax rate was in exchange for bringing 4,000 jobs to the country.
Apple has been accused of getting preferential tax rate from Ireland less than 2%
In lieu of creating employment for thousands in Cork, the Financial Times reported. However, the arrangement had “no scientific basis” and amounted to illicit “state aid” in the guise of tax breaks.
Tax Officials Allegedly “Reverse Engineered” Apples Taxes?
The Commission’s report highlighted two deals that date back to the 1990s, wherein Irish tax officials “reverse engineered” Apple’s tax obligations based on the extent of profit the company sought from its Irish subsidiaries.
It could take years to settle the obligations that were not imposed on Apple.