Skip to main content

Pressure on Apple over European tax affairs ramps up as European Parliament seeks explanations

With a long-running investigation into the legality of Apple’s tax arrangements in Europe not expected to end any time soon, the company will come under additional pressure tomorrow when it is called before the European Parliament’s tax committee.

Reuters reports that the company will be one of four companies asked to explain their European tax arrangements.

Apple, Google, McDonald’s and IKEA will be asked about their European tax deals on Wednesday as EU lawmakers ratchet up the pressure on multinationals to pay more tax on their profits locally.

The committee has no power to demand changes, but it will further add to the PR pressure on Apple at a time when the public mood in Europe is hostile to legal but aggressive tax-avoidance strategies.

I recently set out the reasons I think the company will eventually have to pay an estimated $8B in back taxes.

FTC: We use income earning auto affiliate links. More.

You’re reading 9to5Mac — experts who break news about Apple and its surrounding ecosystem, day after day. Be sure to check out our homepage for all the latest news, and follow 9to5Mac on Twitter, Facebook, and LinkedIn to stay in the loop. Don’t know where to start? Check out our exclusive stories, reviews, how-tos, and subscribe to our YouTube channel

Comments

  1. PhilBoogie - 8 years ago

    “…explain their European tax arrangements”

    LMAO! Arrangements ‘Europe’ put in place themselves. Good grieve, what has the world come to (don’t answer that). The world is in a dire state.

  2. William - 8 years ago

    I worked in the European Parliament for over three years. i wouldn’t want to name names, but trust me: most of them there havent a clue about very much and their egos bounce off the walls. They like to be seen to do stuff, so this falls under that. Ultimately, it’s not really up to the EP about national tax policies.

    • PhilBoogie - 8 years ago

      While this indeed involves national tax structure, it seems the EP is looking at the bigger picture here, which seems, to me, a European affair:
      Double Irish With A Dutch Sandwich
      http://www.investopedia.com/terms/d/double-irish-with-a-dutch-sandwich.asp

      • William - 8 years ago

        V true. And the European commission has already fined Ireland etc but the EP is mostly on a listening/learning exercise, and being seen to response to their constituencies (votes votes votes)

    • Tony Torres - 8 years ago

      are they hiring in the European Parliament I want to work there…

      • William - 8 years ago

        Easiest way is to work for an MEP or political group. Eurobrussels.com isn’t a bad place to look.

  3. rnc - 8 years ago

    And this is the cowardness, stupidness and egocentrism that’s the “great” European Union, no wonder the UK wants to Brexit.

    If the countries made those arrangements, then why do companies have to answer to the damn EU that doesn’t have anything to do with the business operating anywhere?

    It should be ECB vs member states, not ECB vs American companies, that’s simple.

    The problem is the cowardice, because the EU is made of Irish politicians too, and although the rate is low, Apple pays their taxes there which is a lot for Ireland.

    • ninjadude99 - 8 years ago

      “… no wonder the UK wants to Brexit.”

      I almost read that as “breakfast” instead of “Brexit”. 😂

      … I’m sorry. I’ll show myself out.

    • hungoverrr - 8 years ago

      If the authorities believe that the rules have been broken then it makes sense for them to interview both parties.

      It is rumoured that Apple’s effective tax rate outside of the USA is less than 2%. When large firms are able to negotiate such low tax rates, it harms the smaller firms.

      I hardly think the EU can be accused of cowardice. Any one that is willing to risk your wrath might be considered crazy, but a coward, no, never…

  4. hungoverrr - 8 years ago

    I for one would like to know if Apple’s decision to charge all EU customers the higher (23%) Irish VAT rate on iTunes purchases was a direct result of any “sweet heart” deal. Both Google and MS charged the rate of VAT applicable in the country that the customer lived in.

Author

Avatar for Ben Lovejoy Ben Lovejoy

Ben Lovejoy is a British technology writer and EU Editor for 9to5Mac. He’s known for his op-eds and diary pieces, exploring his experience of Apple products over time, for a more rounded review. He also writes fiction, with two technothriller novels, a couple of SF shorts and a rom-com!


Ben Lovejoy's favorite gear