Apple Could Face $14 Billion EU Tax Bill Following Court Advisor's Recommendation to Overturn Previous Favorable Ruling

Essential Highlights

• An EU tribunal advisor has proposed revoking a prior decision that benefited Apple.
• The advisor identified errors made by the tribunal in Apple’s favor regarding a $14 billion tax dispute.
• The dispute centers on whether Apple’s subsidiaries in Ireland received an unjust tax advantage.
• Apple remains confident the earlier ruling will stand, while Irish officials maintain no preferential treatment was granted.

Apple Inc. (AAPL) faces a setback in its ongoing European tax litigation after a legal advisor to the EU’s top court recommended annulling a previous judgment that favored the company, citing procedural mistakes.

The advisor to the Court of Justice of the European Union (CJEU) highlighted flaws in the tribunal’s 2020 decision, which had sided with Apple in a €13 billion ($14 billion) tax case. The European Commission initially accused Apple of benefiting from preferential tax arrangements in Ireland over nearly two decades, with tax rates reportedly dropping to as low as 0.005% of profits in 2004. The case involves Apple Sales International and Apple Operations Europe, both wholly owned subsidiaries operating in Ireland.

While the EU General Court ruled in favor of Apple, stating regulators failed to prove the company received an unfair advantage, Advocate General Giovanni Pitruzzella has now urged the CJEU to overturn this ruling and revisit the case. He argued that the General Court made several legal errors and failed to properly evaluate their impact on the tax decisions.

Though the Advocate General’s opinion is advisory and not binding, the final verdict is anticipated next year. Apple has expressed confidence that the original judgment, which found no selective advantage or state aid was given, will be upheld.

Irish authorities have also reaffirmed their stance, emphasizing that Apple paid the correct amount of tax and that no state aid was involved. Irish Finance Minister Michael McGrath stated, “Ireland’s position remains that the appropriate Irish taxes were paid and that no state aid was provided to Apple.”

This case is part of a broader EU crackdown on multinational corporations’ tax arrangements, led by antitrust chief Margrethe Vestager. Despite previous losses in similar cases against Amazon and Starbucks, the EU continues to intensify scrutiny of tax deals between countries and global companies.

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