European Union action on Apple tax decision 'extremely disappointing'

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The EC said its case will be heard by the European Court of Justice over Ireland's failure to recover the €13 billion or $15.3 billion in tax that Apple, Inc. was ordered to pay.

It said Apple's tax arrangement had enabled one subsidiary, Apple Sales International, to pay 0.005% tax in 2014 - just £50 in taxes on every £1m of profit. According to European Union legislation, any illegal state aid should be recovered.

It ruled at the time that the company had received illegal state aid. That's not good enough for Vestager or the law, which says that European Union states have just four months from the decision to get moving - meaning that Ireland should have sent a strongly-worded letter to Apple by January of this year.

"But member states need to make sufficient progress to restore competition", she said.

Ireland doesn't feel that it's doing anything wrong, and has appealed the decision of the court declaring the tax break as illegal.

But Ireland made progress on calculating the exact amount due - which will be concluded by March 2018 at the earliest, according to Vestager. Both Apple and Ireland are appealing the decision.

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But the commission says such actions "do not suspend a member state's obligation to recover illegal aid". But Ireland has reportedly been dragging its heels on setting up the escrow account (and hiring a fund manager to invest the $17 billion Apple will put in there), and the country now faces rebuke from the EU. Then-Irish Finance Minister Michael Noonan told the press "I disagree profoundly with the Commission's decision", reports The Wall Street Journal, and added that the country intends "to defend the integrity of our tax system".

"However, we have always been clear that the Government is fully committed to ensuring that recovery of the alleged Apple state aid takes place without delay and has committed significant resources to ensuring this is achieved".

On Wednesday, the European Commission announced that it has taken Ireland to court.

The Irish Government reacted angrily to the decision, saying it was disappointed with the European Commission's action.

It said that until the illegal aid is recovered, Apple is benefitting from an "illegal advantage, which is why recovery must happen as quickly as possible".