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Apple might owe the EU billions in back taxes

Published Aug 25th, 2016 3:20PM EDT
Apple Eu Tax Investigation
Image: Apple Inc.

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Apple has been under fire from the EU over its tax system for quite some time, but up until now, we didn’t know how bad things were. JP Morgan, one of Apple’s investment banks overseeing the case, has put the potential tax bill at $19 billion. That’s a ways over the previous estimates, and a healthy chunk of change even for the cash-flush Apple.

The news came at the same time as the US Treasury Department sought to intervene in the case. The government has entered the fight on Apple’s side, accusing the European Commission of being a “supra-national tax authority.”

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As the BBC reports, a US Treasury Department investigation into the case accuses the European Commission (EC) of bias against US companies, saying that a different set of criteria is used to judge US companies, something that it finds “deeply troubling.”

Apple is accused by the EC of using Ireland to shelter profits at a low tax rate, and avoid paying taxes in the country where the profits were actually generated. If the EC has its way, Ireland will be forced to collect back taxes from Apple, which according to JP Morgan, could total $19 billion.

Apple denies any wrongdoing in the case, telling the BBC “We have received no selective treatment from Irish officials. Apple is subject to the same tax laws as scores of other international companies doing business in Ireland.”

The EC’s focus on Apple is the latest in a string of high-profile tax investigations of American companies. Google, Amazon and Starbucks have all come under fire from the EU (or member states) in past years, usually accused of using tax loopholes to shift profit to one EU country with lower tax rates, such as the Netherlands or Ireland.


Chris Mills
Chris Mills News Editor

Chris Mills has been a news editor and writer for over 15 years, starting at Future Publishing, Gawker Media, and then BGR. He studied at McGill University in Quebec, Canada.