Technology

Apple Inc. CEO Privately Meets EU Antitrust Chief About Tax Probe

Apple CEO Tim Cook met with the head of the European Commission’s antitrust efforts, Margrethe Vestager, in a private meeting in Brussels. The meeting is seen as an attempt from Cook to get an exemption from paying billions of dollars in taxes because of its Irish tax structure.

Apple Inc. CEO Privately Meets EU Antitrust Chief About Tax Probe

High stakes involved

Bloomberg reported that both Apple and the Commission confirmed the meeting, but neither agreed to share the topic of the discussion. The Commission is in the middle of an investigation to find out if Apple received illegal state aid from the Irish government in the form of tax deals.

For several years now, Apple has been exploiting Irish loopholes to get extremely low rates on international revenue — as small as 1.8%. The normal corporate tax rate in Ireland is 12.5%. Though the investigation is running behind schedule and the information gathering process is still ongoing, the ruling could be issued soon, probably in March.

The case involves high stakes as Apple could theoretically owe a hefty amount of $8 billion. Also there is a split on the matter among the Irish political parties. Prime Minister Enda Kenny has vigorously denied that Ireland is a tax haven and has promised to fight any EU ruling against the country.

Opposition party against Apple

Meanwhile, the opposition Sinn Fein party has said to willingly pursue the money Apple owes. A spokesman from the Sinn Fein party said it could hold Apple accountable for taxes owed following the ongoing EU investigation. The opposition party said it does not have any intentions of raising the 12.5% corporate tax rate of Ireland and also does not want to make any moves that could make potential investors run away from the country.

“It’s ridiculous in the extreme for the government to say no matter what the commission find, no matter how stark the evidence may be, that they’re going to appeal this,” Sinn Fein spokesman told Bloomberg. “This would be tax that would be due from a company that is more wealthy than the entire Irish state.”

Companies like Fiat and Starbucks and countries like Belgium, Luxembourg, and the Netherlands already have EU aid rulings against them, and this might not bode well for Apple and Ireland.