THE €14billion Apple windfall will not boost next month’s budget as the enormous lump sum will take months to be transferred into the State’s accounts, Finance Minister Jack Chambers has revealed.
A top European court today gave the final ruling in the long running Apple tax case with Ireland losing the decision but winning €14billion.
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Ireland has spent €10million and eight years fighting against the EU competition authority’s claim that our country had a sweetheart deal Apple that enabled the tech giant to dodge taxes.
The Commission said that Ireland had artificially lowered taxes for Apple in an agreement which dated backed to the 1990s and enabled the company to pass major profits through two subsidiaries based in Ireland.
EU competition chief Margrethe Vestager said: “These head offices existed only on paper, no tables, no chairs, no activities. The profits were thus not taxed anywhere.”
The State alongside Apple appealed the decision through the courts and even won their case in a lower court before it was overruled by the European Court of Justice today.
The court’s decision means that Ireland is set to land €14billion that will be transferred from an escrow account into the Exchequer over the coming months.
However, it will be up to the next government after the upcoming general election to decide how the money is spent as it will not be transferred until next year.
Finance Minister Jack Chambers said: “Today’s judgement provides the final determination in this case and the process of transferring the assets in the escrow fund to Ireland will now commence in the manner prescribed in the deed governing the operations of this fund.
“This is a complex process which is expected to take a number of months to conclude.
“The government will need to consider what is the best course of action to take with this revenue and I will be engaging with the party leaders over the coming weeks on this matter
“I need to be clear that this will not impact in the parameters already set out for Budget 2025.”
Minister Chambers and Public Expenditure Minister Paschal Donohoe refused to be drawn on what they would like to see the €14billion windfall spent on.
Minister Donohoe hit out at opposition parties who today made calls for the money to be spent on a series of measures such as housing or infrastructure.
He said: “There is a general division line beginning to develop in Irish politics now on economic matters.
“You have an opposition who wants to spend every single cent that is available to us today and you have the Government who is saying we’re better off leaving some of the money that is available to us for tomorrow because you never know what’s around the corner.
“In the last four years, we’ve seen two shocks hit us that few saw coming and we were able to help because we managed our public finances well in the period up to that.
“There is little doubt that the issue we’re dealing with today will bring that difference further to light but the general argument that myself and Minister Chambers are making here and have made in recent months and years of this Government, is that if you don’t spend every single euro that is available to you in any given year, you have a better ability to look after your country when big and difficult things happen.”
WHAT €14BN CAN BUY US
By ADAM HIGGINS, Political Correspondent
- 41,666 of the flashy €336,000 Leinster House bicycle sheds, on yer bikes!
- Seven more €2bn National Children’s Hospitals – but who knows when they’d finally be able to open.
- 14,000 shiny new Dail printers – now we just have to find a room they can fit in.
- The Dublin metro – more than €500million is expected to be spent on this rail network before they even break ground with the most recent projection estimating a final bill of €12billion.
- Around 40,000 houses – a recent study found that building a three-bed home in Ireland costs around €350,000 – house about an end to the housing crisis?
Minister Donohoe was part of the Government that first decided to fight the Apple tax ruling with the Fine Gael TD today saying he had no regrets on how the State handled the issue.
The Dublin TD argued that Ireland needed to defend its tax policy and claimed that there was no special agreement with Apple – despite the court’s ruling.
Apple today said the case was never about how much tax the company paid but was instead about where they paid their taxes.
They said: “The European Commission is trying to retroactively change the rules and ignore that, as required by international tax law, our income was already subject to taxes in the US.
“We are disappointed with today’s decision as previously the General Court reviewed the facts and categorically annulled this case.”
Apple said that they paid $20billion in tax on the same profits that the Commission claims should have been taxed in Ireland.
Several “third country adjustments” have already been made to the €14billion which has seen several hundred million awarded to other countries who would have be due tax rewards from the situation.
There are no further claims currently in place from other countries however, claims could be lodged over the coming months which would reduce the fund marginally.
