Apple is in the midst of a tax battle with lawmakers in Europe after being accused of taking tax breaks in Ireland. The European Union invited the company to a hearing with regulators. However, Apple turned down the invite, citing its impending appeal as a reason for the absence.
Last August, the European Commission closed a three-year investigation against Apple. The regulatory body found the company had received illegal state aid from Ireland. Specifically, Apple allegedly only paid between 0.005 percent and 1 percent in taxes between 2003 and 2014. For perspective, Ireland usually has a 12.5 percent corporate tax rate.
So, the iPhone maker was given a tax break. The EU ordered the company to pay back up to 13 billion euros ($14.8 billion) in back taxes in Ireland.
Apple has since appealed the decision in Europe’s second highest court in Luxemburg. The company says this appeal prevents it from attending the new hearing as doing so could compromise its challenge. The European Commission is holding a hearing on tax evasion on June 21.
“It is important to ensure public commentary does not prejudice those proceedings,” Claire Thwaites, Apple’s senior director of European government affairs, says.
“Since the appeal is ongoing and likely to be heard at the General Court in the near future we will not be able to participate in a public hearing on this topic as it could be detrimental to the proceedings at the Court and any potential appeals thereafter,” Thwaites adds.
While Apple and Ireland are appealing the case, regulators have said they want the entire repayable amount to be paid as soon as possible. However, Apple and Ireland have also been in dispute. The country has suggested taking the company to court if it is forced to pay.
Irish Prime Minister Leo Varadkar has responded, saying to parliament, “We’ve indicated to them (Apple) that we want the escrow account established and we want funds to be paid into the escrow account without further delay.”
“We do not want to be in the situation where the Irish government has to take Apple to court because the European Commission is taking the Irish government to court. I think that message is understood and I’d anticipate progress in the coming weeks.”