An appeal by Ireland and Apple against a ruling by the European Union demanding that the tech giant pay $16 billion in taxes could be heard this year according to Paschal Donohoe, the Irish Finance Minister. In August 2016 the European Commission delivered a ruling which stated that unfair tax incentives were awarded to Apple. Both Ireland and Apple have filed an appeal arguing that the tax treatment that the tech giant received did not go against either the laws of the European Union or Ireland.
“We expect the appeal is likely to begin in the autumn. How long the hearings will last will depend on the judges overseeing it and could be open to either party after that to take any further action,” said Donohoe.
13 billion euros
In the ruling Ireland was ordered by the European Commission to collect back taxes amounting to 13 billion euros. According to the finance department of Ireland this figure could go as high as 15 billion euros when EU interest was taken into account. Per Donohoe the interest amount that Apple owes will be tallied once the 13 billion euros are paid.
Last year in October the European Commission indicated that Ireland would have to face the European Court of Justice since there were delays regarding the recovery of the money which was supposed to have been paid last year in January. The initial ruling had been made four months prior.
EU Court of Justice
Earlier this week a spokesperson said the European Commission was hoping the back taxes would be paid soon in order to allow for the closure of the action that the EU Court of Justice had instituted against Dublin after the deadline was missed. Ireland has however fought claims of delays saying it has done its best to facilitate the collection of the amounts owed by Apple.
In March escrow account managers were appointed by Ireland and they will be responsible for holding the money. According to Donohoe Apple will start making the series of payments in this year’s second quarter. Paying of the entire is expected to be completed before the third quarter ends.
This comes in the wake of Apple’s stock falling as outlook from key suppliers in Asia indicated that there was low demand for iPhones. Some of the key suppliers of Apple are heavily dependent on the Cupertino, California-based tech giant and the state of their businesses is strongly correlated to that of the iPhone maker.