Tim Cook urges Dublin to appeal EU ruling

Posted on September 1, 2016

File photo dated 11/11/2015 of Apple chief executive Tim Cook who has branded his company's 13 billion euro (£11 billion) bill for unpaid taxes in Europe as "political crap", maddening and untrue. PRESS ASSOCIATION Photo. Issue date: Thursday September 1, 2016. The chief executive dismissed an audit by a Brussels watchdog which found it only paid 0.005% tax in 2014, and claimed the global tech brand paid a worldwide rate of 26.1% on its earnings that year. See PA story IRISH Apple. Photo credit should read: Niall Carson/PA Wire©PA

The row between Apple and Brussels over a €13bn tax penalty escalated on Thursday, with the technology company’s chief executive calling the decision “invalid” and “crap” as he called on the Irish government to appeal.

Dublin was ordered this week by the European Commission to clawback up to €13bn from Apple after its tax arrangements in Ireland were judged to represent illegal state aid.

    However, Mr Cook told the Irish Independent newspaper that the ruling was “total political crap”, adding: “They just picked a number from I don’t know where.”

    Mr Cook used a separate interview with RTE, Ireland’s national broadcaster, to urge the government to appeal the EU decision.

    “It is important the [Irish] government stands strong on that because future investment for business really depends on a level of certainty,” he said.

    EU competition chief Margrethe Vestager responded to allegations from Apple that Brussels had overstepped its jurisdiction in its pursuit of the iPhone maker, and defended the commission’s controversial use of state aid rules.

    “The Apple case is about profits made by sales in Europe, it is profits that are recorded in Ireland,” she said.

    “It is a question of taxes being paid in the European jurisdiction on profits being made or at least recorded here. It is, I think quite obviously, a European matter and a matter for EU state aid rules because it has to do with European issues.”

    In response to Mr Cook’s charge of having “just picked a number”, the Danish politician called on Apple and Ireland to allow the release of the confidential ruling so that people could see the detail behind the commission’s arguments.

    “If it was up to me, the confidential version would have been published yesterday,” said Ms Vestager. “I hope that Apple and Ireland will be as open and co-operative as possible in order to let us publish the decision as fast as possible. It is very good for everyone to see our reasoning.”

    The exchange comes amid signs of splits within the Irish government on whether to join Apple in appealing the tax ruling through the European courts.

    At a lengthy meeting on Wednesday, several ministers asked for more time to study the commission’s verdict, which accused Ireland of breaching state aid rules in providing special tax concessions to Apple between 1991 and 2014. It also ordered the US company to repay €13bn to Dublin.

    Mr Cook told RTE that appealing the EU ruling was a “decision for the Irish government”. But he was “pretty confident the Irish government will do the right thing and I think the right thing is to stand up and fight against this over-reach”.

    He added: “Where it might feel good for the moment, if you think about the long term for the country and more broadly for the [European] Union, I think it’s important to uphold these principles and not retroactively change them.”

    Mr Cook told the Irish broadcaster Apple’s investment in Ireland was a “37-year marriage, and like any marriage you go through a pot hole here and there”.

    He pointed out that Apple had first come to Ireland in 1980, more than a decade before the European Commission says the company struck its special tax deal with the Dublin government.

    “We didn’t go there to seek advantage on taxes. We only had 60 employees and very little revenue,” he said.

    Apple tax

    He also recalled how, in 1988 with Apple “on the brink of bankruptcy”, it had considered pulling out of Ireland.

    “We stuck together because we always felt so close to the community there and to the people there and every time I go it’s like getting a shot of joy being there.”

    He repeated Apple’s commitment to Ireland, pointing to plans to build an $800m data centre and expand its Cork facility. He said those investments were “moving forward per plan”.

    “We are not going to let an invalid ruling — a politically-based ruling — affect our commitment to Ireland.”

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