TECH GIANT FINED FOR NOT PAYING TAX

Ireland must recover up to 13 billion euros
($14.6 billion) in unpaid taxes from Apple,
European officials said on Tuesday.
The tax ruling is the biggest the European Union
has ever made regarding a single company, and
it could spark a huge transatlantic row over how
Europe treats U.S. companies.
Apple shares initially fell almost 3%, but then
recovered most of their losses. The company
will appeal the decision. It said the ruling
upended the international tax system and would
damage jobs and investment in Europe.
The European Commission, which administers
EU law, said the Irish government had granted
illegal state aid to Apple by helping the tech
giant to artificially lower its tax bill for more
than 20 years.
"[EU] member states cannot give tax benefits to
selected companies -- this is illegal under EU
state aid rules," said Commissioner Margrethe
Vestager, Europe's top antitrust official.
The United States fired back immediately,
saying retroactive tax assessments by the EU
were unfair.
"The Commission's actions could threaten to
undermine foreign investment, the business
climate in Europe, and the important spirit of
economic partnership between the U.S. and the
EU," a Treasury spokesperson said.
The decision amounted to "a transfer of revenue
from U.S. taxpayers to the EU," White House
press secretary Josh Earnest said. The Obama
administration would fight for "American
taxpayers and American businesses overseas
when they're being treated unfairly," he added.
Apple paid tax at 1%, or less, on profits
attributed to its subsidiaries in Ireland, well
below the 35% top rate of corporate tax in the
United States and Ireland's 12.5% rate.
That prompted complaints by both European and
U.S. lawmakers, who argued that Apple had
been given an unfair advantage in exchange for
creating jobs in Ireland. CEO Tim Cook was
even called to testify on Apple's tax
arrangements with Ireland before a Senate
committee in 2013.
The bill for tax benefits, plus interest, covers
2003 to 2014. Apple has more than $231 billion
in cash on its balance sheet to cushion the
blow.
Cook said on Tuesday the ruling had "no basis
in fact or in law," calling it "obvious targeting of
Apple."
Apple had helped create and sustain more than
1.5 million jobs across Europe, follows the law
and pays all the taxes it owes, he added.
"The European Commission has launched an
effort to rewrite Apple's history in Europe,
ignore Ireland's tax laws and upend the
international tax system in the process," he
wrote.
Ireland said it will appeal the decision, saying
Apple paid what it owed. The country has one of
the lowest corporate tax rates in Europe, which
makes it an attractive place for global
companies.
The Irish government is afraid companies would
be less likely to invest in Ireland if its tax regime
changes, which could cost the country
thousands of jobs.
Apple is not the only American company that
has recently found itself under scrutiny over its
European tax affairs.
The European Commission ordered Starbucks
and Fiat Chrysler to repay millions in taxes last
October.
Starbucks has to pay back up to 30 million
euros it saved thanks to a sweetheart tax deal
with the Netherlands. Fiat Chrysler was ordered
to repay a similar amount after a similar deal
with Luxembourg.
Both companies have appealed the decisions.
The EU is also probing the tax arrangements of
Amazon and McDonald's. Google is under
investigation over its taxes in France and a
couple of other European countries.
The ruling against Apple's tax deal comes
despite a stern warning from the U.S. Treasury
Department last week that it would consider
"potential responses" if the Commission doesn't
change course.



Source:cable news network
Edited by DANIEL IKECHUKWU EKWUNIFE