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Monday 19 deceMber 2016 BUSINESS
A24

Ireland to appeal EU’s record $14 billion tax order on Apple

SHAWN POGATCHNIK
Associated Press Apple got benefits denied
DUBLIN (AP) — Ireland to other companies based
will appeal the European here.
Union’s landmark order to The Irish reply sets the stage
collect a record 13 billion for a titanic legal battle
euros ($14 billion) in taxes from Brussels to California
from Apple, the Irish De- and beyond that has impli-
partment of Finance an- cations for more than 600
nounced Monday. U.S. multinationals based
The Irish countermove in Ireland and thousands
comes nearly four months more using tax-avoidance
after EU competition au- vehicles globally. Apple
thorities hit Apple with the Inc. chief executive Tim
back-tax bill based on its Cook already has de-
longtime reporting of Euro- nounced the EU judgment,
pean-wide profits through disputes its calculations,
Ireland, which charges the and says the company will
American company only pursue its own legal chal-
for sales on its own territory lenges expected to last
at Europe-low rates that in years.
turn have been greatly re- Ireland, an EU member
duced by the controversial Apple CEO Tim Cook listens as President-elect Donald Trump speaks during a meeting with tech- since 1973, for decades
use of shell companies at nology industry leaders at Trump Tower in New York, Wednesday, Dec. 14, 2016. has charged a headline
home and abroad. Associated Press rate on corporate taxes
In its formal legal submis- across the European bloc euros ($20 billion) because economic output. Apple of 12.5 percent —less than
sion, the Department of Fi- from 2003 to 2014. Her re- of compounding interest today is the biggest pri- half the European norm
nance declares that’s the port concluded that Cu- from delayed payment. vate employer in the Irish and nearly a third the U.S.
whole point of Ireland’s pertino, California-based The centerpiece of Ire- Republic’s second-largest rate of 35 percent — and
sales pitch to foreign in- Apple used two shell com- land’s argument is that city, Cork, with a workforce has facilitated the com-
vestors — and asserts it’s panies incorporated in Ire- Vestager should have con- exceeding 5,500. Econo- plex use of shell compa-
perfectly legal to levy far land to permit Apple to re- fined herself to policing ille- mists estimate Apple’s Cork nies that help Apple and
less tax on profits than im- port its Europe-wide profits gal state aid that gives an operation pumps around scores of other high-tech
posed by competitors. It at effective rates well un- unfair advantage to a par- 16 billion euros ($17 billion) global enterprises, includ-
accuses EU competition der 1 percent. ticular company, whereas annually in salaries, tax and ing social media and phar-
authorities of unfairness, The EU judgment could the EU has launched an investment into the Irish maceutical leaders, to pay
exceeding their compe- have been even huger, assault on a policy that Ire- economy. far less on non-U.S. sales of
tence and authority, and because EU time limits land has offered to all for- “The purpose of the state goods and services.
seeking to breach Ireland’s meant the judgment could eign companies locating aid rules is to tackle state The Department of Fi-
sovereignty in national tax include potential tax in- on its soil. interventions which con- nance has pledged to
affairs. fringements dating only The benefits are obvious in fer a selective advantage. close its shell company-fo-
The ruling unveiled Aug. 30 from 2003, not all the way Ireland, which has the fast- The state aid rules by their cused rules, but that move
by EU Competition Com- back to Apple’s original est-growing economy in Eu- nature cannot remedy is expected to create no
missioner Margrethe Ve- 1991 tax deal with Ireland. rope driven by the exports mismatches between tax obstacle to global com-
stager called on Apple Still, Irish specialists in corpo- of about 1,000 multination- systems on a global level,” panies, which can shift the
to pay Ireland the 13 bil- rate tax estimate that the als that employ 5 percent the Department of Finance same accounting strate-
lion euros for gross under- EU’s order, if enforced, ac- of the workforce and gen- brief argued as it contest- gies to other countries be-
payment of tax on profits tually would total 19 billion erate nearly a quarter of ed the EU’s contention that yond the EU’s wrath.q
Australia’s projected annual deficit worsens by $3.2 billion

By Rod McGuirk mining boom, the gov- forecasts released Monday sector and increase the tax losing its coveted triple-A
CANBERRA, Australia (AP) ernment’s latest forecasts said growth in the AU$1.7 paid by mining companies, credit rating by early 2017
— Australia’s projected showed Monday. trillion economy had documents said. due to the worsening eco-
budget deficit for the cur- The deficit for the year slowed to 2 percent for the “However this will be more nomic performance. Fewer
rent fiscal year has in- ending June 30, 2017, had year from the 2.5 percent than offset by the impact than a dozen countries
creased by 4.4 billion Aus- been forecast to reach expected in May. of weaker growth in ag- have a triple-A rating from
tralian dollars ($3.2 billion) AU$37.1 billion when the Higher prices for iron ore gregate wages and non- Moody’s Investors Service,
to AU$41.5 billion as the annual budget was re- and coal — Australia’s big- mining profits,” the forecast Standard and Poor’s Glob-
economy continues to slow leased in May. gest exports — would in- said. al Ratings and Fitch Ratings
following a China-driven But updated economic crease profits in the mining Analysts say Australia risks Inc. q