In a potential stumbling block for Apple, an adviser to Europe’s top court has recommended a reevaluation of the EU tribunal’s ruling in favor of the tech giant over a staggering 13-billion-euro ($14 billion) tax order. Giovanni Pitruzzella, the adviser, contends that the General Court committed legal errors in its decision and is calling for the Euro tax case to be revisited, raising questions about the fairness of multinational tax arrangements.
The tax dispute revolves around allegations that Apple enjoyed the benefits of two Irish tax rulings for over two decades, artificially reducing its tax burden to an astonishingly low 0.005% in 2014. Margrethe Vestager, the European Commission’s antitrust chief, has been at the forefront of cracking down on such deals between multinationals and EU countries, arguing that they constitute unfair state aid.
While the General Court had upheld Apple’s challenge in 2020, Pitruzzella disagreed, stating that the court committed legal errors and failed to properly assess certain methodological errors pointed out by the Commission. He recommended setting aside the General Court ruling and referring the Euro tax case back for a new assessment.
Ireland, a pivotal player in the proceedings, maintains its stance that it did not provide any state aid to Apple. Michael McGrath, speaking on behalf of Ireland, emphasized that Pitruzzella’s opinion is non-binding and does not form part of the final judgment, underlining the complexity and ongoing nature of the legal saga.
Apple, which had appealed against the tax order along with Dublin, had already paid the full amount, which was being held in an escrow account. Despite the ongoing legal battle, Apple remains firm in its stance that it received no selective advantage or state aid.
EU Court of Justice
The ruling from the EU Court of Justice (CJEU) is expected in the coming months, and typically, the court follows around four in five such recommendations.
This development adds another layer to Vestager’s mixed record in defending tax cases in court. While she secured a significant victory in September against a Belgian tax scheme, challenges by companies like Stellantis, Amazon, and Starbucks were backed by the judges.
Vestager continues her tax crackdown, investigating cases involving IKEA, Nike, and Huhtamaki. The outcome of the Apple Euro tax case, labeled as C-465/20 P Commission v Ireland and Others, will undoubtedly have broader implications for multinational tax arrangements within the EU.