ECJ Orders Apple to Repay €13 Billion in Back Taxes to Ireland

The European Court of Justice (ECJ) has mandated that Apple must return €13 billion (approximately £11 billion or $14 billion) in unpaid taxes to Ireland. This decision follows accusations from the European Commission that Ireland provided Apple with illegal tax benefits, a ruling initially made eight years ago.

The court’s statement confirmed the Commission’s 2016 ruling that Ireland had granted Apple unlawful aid, which must now be reclaimed. This ruling comes shortly after Apple launched its iPhone 16 range, highlighting the timing of the announcement.

The ECJ’s decision marks the conclusion of a protracted legal battle regarding Apple’s tax arrangements in Ireland, covering the years from 1991 to 2014. The Commission argued that the favorable tax treatment received by two Apple subsidiaries in Ireland constituted illegal advantages not available to other companies.

This legal saga began as part of the EU’s broader effort to tackle tax avoidance by multinational corporations through elaborate financial strategies. While the initial ruling was upheld, a lower court of the ECJ overturned it in 2020, siding with Ireland’s appeal. However, the higher court has now reversed that decision, citing legal errors in the earlier judgment.

As a result, the Irish government is now required to recover the substantial tax amount from Apple, a task it has attempted to avoid through extensive legal negotiations.