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Apple Pays €1.5 Billion as Initial Payment for Back Taxes to Ireland

AppleTechnology is now accelerating at an unprecedented speed. With companies like Apple in its forefront, innovation is what drives the industry forward. Being one of the biggest industries that the world has ever seen, technology has become a new gold rush bringing in billions of dollars in revenue worldwide.

However, the growth of the industry has been a fast one with the world barely catching up. Politics around the world has yet to cope with the sudden boom. One sector that proves to be of concern is the proper taxation of tech companies.

Initial Payment

Irish Finance Minister Paschal Donohoe, announced that initial payments have been made earlier this month

Apple has begun paying it’s €13 billion in taxes it owes to Ireland, according to sources. The tech giant has made an initial payment of 1.5 billion euros ($1.18 billion) in an Escrow account set up by the country. With the payment done by the Cupertino-based company, the EU officials are reportedly open to dropping the lawsuits against the Irish Government for delays in collecting the payment.


In 2016, the European Commission ordered Ireland to collect (EU)13 billion in back taxes owed by Apple Inc. The commission claimed that Ireland had made preferential tax deals with the company to purportedly entice the multinational company into the country.

This, the commission adds, led Apple to pay only the minimum taxes to the European Union. However, both Dublin and Apple denied that such deals were made between the two and that the tech company complied with EU and Irish tax laws.

Apple Inc. CEO Tim Cook says the multi-billion company is in hot water after claims of “sweetheart deal” with Ireland

The European Commission, as well as the executive arm of the union, announced back in October of last year that they would be taking Dublin to the European Court of Justice because of the delays in the collection of the taxes owed.

The initial tranche of the payment should have been collected by January 2017, four months after the first ruling. With this, the commission started pressuring Dublin into collecting the back taxes owed so that the legal actions can be dropped. If the European Court of Justice found Ireland to be liable, the could face hefty fines. 

Apple and Dublin have formally appealed the ruling denying any irregularity on their side. The appeal is likely to be heard later this year as stated by Mr. Donohoe back in April this year. However, no exact dates are given.

Apple to face the EU on its own

The U.S. government was blocked by the European Union to participate in any involvement in the appeal that Apple made

Earlier this month, The European Court of Justice has blocked the US’s involvement in Apple’s appeal to the ruling. This is an upholding of a ruling of a lower court in December 2017 stating the US has failed to prove that it has a direct interest in the matter.

A US Department of Justice official has said the country is disappointed that it has been denied involvement and that emphasized that they indeed have direct interest due to legislation that has been enacted as the lower court made a decision.

Terms of Payments

According to Irish press, a series of payments will be made to the escrow accounts at the 2nd and 3rd quarter of 2018. This low-risk escrow account will be managed by Amundi, BlackRock Investment Management, and Goldman Sachs Asset Management, until such time as a final decision is made regarding the matter.

The EU and other Tech Giants

Last year, The Commission handed $2 billion in fines against Google over antitrust concerns. They also sanctioned Facebook Inc., with a hefty fine of $122 million for giving misleading statements regarding its acquisition of WhatsApp.

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