Cyprus’ services sector has welcomed Wednesday’s decision by the second-highest EU court to rule against the European Commission in a 2016 claim for €14.3 billion in Ireland taxes from Apple.
The suit had been brought by the Republic of Ireland and the Commission claimed that Apple had received preferential tax treatment, which they called unfair state aid in a different form.
The crucial decision comes at a time when pressure at European level for drastic changes in the taxation of each member state is on the rise, insiders told Phileleftheros.
The Financial Times recently revealed plans by the EU to change tax data in a way that will not allow countries the veto right.
Adding salt to the wound is Britain’s exit from the bloc, a member state that had long advocated for each country to retain the right to apply the tax rate it wants.
The EU’s second-highest court on Wednesday ruled that Brussels did not succeed in “showing to the requisite legal standard” that the tech giant had received an illegal economic advantage in Ireland over its taxes.
Competition Commissioner, at the time, Margrethe Vestager had ruled in 2016 that Ireland had given Apple a “special” deal that she claimed had lasted 10 years.
But the court ruled that the terms of Article 107(1) of the Treaty on the Functioning of the European Union, which deals with state aid, were not violated.
At the time, Apple CEO Tim Cook exclaimed that this was “total political crap.”
The ruling has not necessarily borne out that statement, but it has set back EU Commission efforts to crack down on corporates who seek to make use of low-tax jurisdictions.