On 30 August 2016, the European Commission issued a negative decision in the Apple State Aid case.
The Government profoundly disagrees with the Commission's analysis and will now challenge the decision before the European Courts. Ireland did not give favourable tax treatment to Apple. Ireland does not do deals with taxpayers.
No other companies are covered by the European Commission decision or the recovery order. The European Commission has explicitly stated that "this decision does not call into question Ireland's general tax system or its corporate tax rate".
However, the decision creates uncertainty for business and foreign direct investment in the European economy, both in its novel interpretation of longstanding rules and their unfair retroactive application.
The Government's appeal is therefore necessary to defend the integrity of our tax system; to provide tax certainty to business; and to challenge the encroachment of EU state aid rules into the sovereign Member State competence of taxation.
The Commission has stated that the amount of unpaid taxes to be recovered by the Irish authorities would be reduced if other countries were to require Apple to pay more taxes on the profits recorded by Apple Sales International and Apple Operations Europe for this period; and the amount of unpaid taxes to be recovered by the Irish authorities would also be reduced if the US authorities were to require Apple to pay larger amounts of money to their US parent company for this period to finance research and development efforts.
This illustrates the contradiction at the heart of the European Commission's decision. While requiring Ireland to recover the tax sums, the Commission is also acknowledging that the sums may in fact be taxable in other jurisdictions.