Apple, $AAPL, must pay $14 billion tax bill to Ireland
The European Union's top court on Tuesday dismissed Apple's final appeal against an order from the bloc's executive commission to repay €13 billion (over $14 billion) in back taxes to Ireland, concluding a long-running legal battle.
The European Court of Justice overturned a lower court's previous ruling, stating that it "confirms the European Commission's 2016 decision: Ireland granted Apple unlawful state aid which Ireland is required to recover."
The case sparked strong reactions when it first emerged in 2016, with Apple CEO Tim Cook calling the ruling "total political crap." At the time, U.S. President Donald Trump criticized European Commissioner Margrethe Vestager, who led the crackdown on special tax arrangements and large U.S. tech companies, referring to her as the "tax lady" who "really hates the U.S."
The European Commission had accused Apple of securing an illegal tax arrangement with Irish authorities, allowing it to pay minimal taxes. A 2020 ruling by the EU General Court disagreed with the commission, but that decision has now been reversed.
"We are disappointed with today's ruling, as the General Court had previously reviewed the facts and annulled this case," Apple said in a statement, insisting that "there has never been a special deal."
Tax loopholes closed
The 2016 ruling, which found that Ireland granted Apple a favorable tax deal enabling the company to pay almost no taxes across the EU for 11 years, intensified the global debate about whether major U.S. corporations are paying their fair share. The EU's executive branch argued that Ireland's tax breaks for Apple were so generous that the company’s effective tax rate on European profits fell from 1% in 2003 to just 0.005% in 2014—figures Apple disputes.
The court's decision is part of a broader effort by European officials to hold U.S. tech giants accountable under the EU’s rules on taxation, competition, and privacy.
On the same day, Google lost its final legal challenge against a €2.4 billion ($2.7 billion) fine imposed by the European Commission for giving its own shopping services an unfair advantage in search results, ending a long-running antitrust case.
The European Court of Justice upheld a lower court's ruling, rejecting Google's appeal and leaving the fine intact.
Both Apple and Google have now exhausted their appeals in cases dating back to the previous decade. These decisions mark a victory for European Commissioner Margrethe Vestager, who is set to step down after a decade overseeing competition policy.
Experts say the rulings show how regulators have become more assertive in holding tech giants accountable. "One key takeaway from the Apple ruling is the EU's willingness to flex its collective muscles to bring Big Tech in line when necessary," said Alex Haffner, a competition partner at law firm Fladgate, via email.