Tim Cook hits back at 'maddening' European ruling on Apple tax


Apple CEO Tim Cook, talking to Ireland's RTÉ News, says that allegations put forward by the European Commission that his company owes $14.5 billion in back tax are 'maddening'. He is also very confident that the Commission's ruling will be overturned on appeal.

Echoing an open letter published earlier in the week, Cook said that the claims that Apple was given preferential treatment and special tax arrangements in Ireland have "no basis in fact or in law". The Irish cabinet has already met to discuss how to tackle the appeal that Apple is expected to launch, but has yet to reach a decision. The appeal will see Apple restating Tim Cook's claim that the tax figure put forward by Europe is "false".

While the European Commission says that Apple has paid an effective tax rate as low as 0.005 percent, Cook disputes this, saying that the company paid "a worldwide income tax rate" of 26.1 percent that year. It's worth pointing out that the Commission did not make any comment about Apple's worldwide tax payment, just those in Ireland based on European income.

He goes on to say that Apple was not only the biggest corporate taxpayer in Ireland in 2014, but that it paid out $400m, "and that amount of money was based on the statutory Irish income tax rate of 12.5 percent".

In an impassioned interview, Cook defended both Apple and the Irish government, saying:

It's maddening, it's disappointing, it's clear that this comes from a political place, it has no basis in fact or in law, and unfortunately it's one of those things we have to work through. When you're accused of doing something that is so foreign to your values, it brings out an outrage in you, and that's how we feel. Apple has always been about doing the right thing. We haven't done anything wrong, and the Irish government hasn't done anything wrong.

In Tuesday's open letter he was just as passionate, lashing out at the European Commission:

The Commission’s move is unprecedented and it has serious, wide-reaching implications. It is effectively proposing to replace Irish tax laws with a view of what the Commission thinks the law should have been. This would strike a devastating blow to the sovereignty of EU member states over their own tax matters, and to the principle of certainty of law in Europe. Ireland has said they plan to appeal the Commission’s ruling and Apple will do the same. We are confident that the Commission’s order will be reversed.

For now there is little more than a war of words. The Irish cabinet meets again on Friday to discuss how to proceed.

Photo credit: JStone / Shutterstock

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