Sven Giegold

EU tax day: Defeat in Apple state aid case must be wakeup call for German Council presidency

Today, the General Court of the European Union annulled the Commission’s 2016 state aid decision concerning Apple in Ireland. The European Commission had previously concluded that tax breaks approved by Apple in Ireland and Apple’s European corporate structure had led to illegal state aid. The Commission decided that Apple should repay €13 billion plus interest in unpaid taxes, the largest sum ever in a state aid case. Ireland and Apple had challenged the decision before the European Court.

In addition, the EU Commission today presented its tax action plan. The plan aims to fight tax fraud and simplify tax legislation. This action plan, consisting of measures by the new EU Commission in the fight against tax evasion and avoidance, was promised to me by tax Commissioner Paolo Gentiloni at his hearing before the Economic and Monetary Committee last year. According to the plan, the majority procedure in tax matters on the basis of Article 116 of the Treaty, which we Greens have long been calling for, is only to be explored. The Commission made no concrete proposals. The chapter on corporate and digital taxation is excluded from the action plan. The Commission intends to present separate proposals on this in the autumn, depending on the outcome of the OECD’s international negotiations.

MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:

“Today’s ruling by the General Court on illegal state aid to Apple in Ireland is a bitter setback in the fight against tax dumping in Europe. EU state aid rules are totally insufficient to tackle tax dumping in Europe. This must be a wakeup call for the Commission and Council to step up tax legislation. The EU urgently needs minimum effective tax rates, a common and consolidated corporate tax base, and public tax transparency.”

“The German Council Presidency must put the tax reform proposals that are currently blocked on the ECOFIN agenda, and must secure a majority for corporate tax transparency through country-by-country reporting for large companies. The ball is now in the court of EcoFin president and German finance minister Scholz. The Council needs to move to majority voting on tax issues and the Commission should make new proposals on tax under Article 116 of the Treaties to avoid vetoes by individual Member States. Germany must abandon its opposition to public tax transparency for large companies. In the light of huge public spending to counter the Covid-19 crisis citizens expect European results for fair taxation.

“The European Parliament should organise a hearing and discuss with the Commission and the Council Presidency how we can finally deliver tax justice in the EU.

The EU Commission’s action plan ignores the most important questions after the ruling. The plan postpones digital taxation, corporate taxation and majority decisions on tax matters. The action plan does not provide answers to the failure of the EU Commission in court today.”

Link to the Apple judgement of the EU General Court:

Jean-Claude Juncker’s promise on Article 116 TFEU (from minute 53:04 of the video):

Green 10-point plan for more tax justice:

Category: Economy & Finance, European Parliament

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