Apple on Monday filed an appeal of a $14.5 billion tax judgment levied by the European Union, which the tech giant said was contrived to maximize penalties and ignore the opinions of tax experts.
The Wall Street Journal reports that Apple intends to argue that a judgment announced in August, in which the European Commission said the company received illegal state aid from Ireland in the form of tax breaks, was rigged.
Apple's general counsel Bruce Sewell said Monday that the company was singled out as a convenient target, and that the Commission has failed to respond to evidence presented by the Irish government's tax experts.
"Apple is not an outlier in any sense that matters to the law. Apple is a convenient target because it generates lots of headlines," Sewell tells Reuters. His comments echo those made by Apple CEO Tim Cook in August, who also warned that if Apple ends up having to pay the penalty, it would "strike a devastating blow to the sovereignty of EU member states over their own tax matters."
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- EU: Ireland Gave Apple $14.5B in Illegal Tax BenefitsEU: Ireland Gave Apple $14.5B in Illegal Tax Benefits
The Irish government supports Apple's appeal, and said in a statement Monday that the European Commission "misunderstood the relevant facts and Irish law." At issue is Ireland's so-called "arm's length principle" (ALP), which the Commission says Apple used to pay virtually no taxes on two business units registered in Ireland, and also avoid paying taxes on them in the US.
"Even if ALP were legally relevant (which Ireland does not accept) the Commission has failed to
apply it consistently or to examine the overall situation of the Apple group," according to the statement, from the Irish Department of Finance.
Meanwhile, the Commission released a 130-page report Monday supporting its August decision, reiterating that Ireland "unlawfully granted State aid" to Apple.