Apple Pay has officially expanded to Ireland today for customers of KBC and Ulster Bank, two of the country’s big four banking institutions. The service also works with EU’s Boon prepay system tied to MasterCard. Irish customers who register their Visa or MasterCard credit or debit cards via the Wallet app can start using the service to pay securely for goods in “tens of thousands” of stores, including Aldi, Boots, Burger King, Harvey Norman and Lidl.
Apple Pay is also supported in compatible apps and on some websites. The Cupertino company has added related Apple Pay details to its regional website in Italy, signaling an imminent launch in the 60 million people market. Also, major banks have recently gained regulatory approval to launch Apple’s payments service in Taiwan.
Later this week, Apple and the government of Ireland will appeal against the European Union’s $14.5 billion tax ruling targeting Apple’s sweetheart tax deal with Dublin that the EU deemed “illegal state aid.” According to Reuters today, the Cupertino firm will object to the fact that EU regulators ignored established tax experts and common corporate law.
Apple’s legal strategy involves painting itself as a victim of its own success. EU deliberately singled out Apple due to its success and picked a method to maximize the penalty, said Apple’s top lawyer Bruce Sewell.
French tax authorities have recently issued Apple a fine in the amount of 400 million euros (about $422 million), according to L’Express. At the core of the adjustment is Apple’s complex and controversial tax optimization scheme that allows the firm to send back the lion share of its profits to tax-friendly countries such as Ireland.
In August, the European Commission slammed Apple with a tax bill from hell over a sweetheart deal it received from Ireland—which, in the Commission’s view, constitutes “illegal state aid”.
Dublin promptly promised to join Apple’s fight against EU and it’s put its money where its mouth is.
Michael Noonan, Finance Minister in the Irish government, said that Dublin today challenged the EU judgment by submitting an appeal to the European courts in a bid to block the decision, ArsTechnica reports.
Following news earlier this week that the European Commission had ruled that Apple must pay €13 billion ($14.5 billion) in back taxes to the government of Ireland because its sweetheart deal with Dublin that lets it be subjected to a lower tax rate constitutes “illegal state aid,” the Irish government said today it would join Apple in its fight against the ruling.
“Paradoxically, Ireland is determined not to accept the tax windfall, which would be equivalent to what it spent last year on funding its struggling health service,” says the report.
The European Commission has ruled that Apple is on the hook for €13 billion ($14.5 billion) in back taxes as its “sweetheart deal” to pay a lower tax rate in Ireland has been characterized as “illegal state aid”.
Apple is going to appeal the ruling and now CEO Tim Cook has penned an open letter, entitled “A Message to the Apple Community in Europe,” in which he explains Apple’s position in this case, writing he is “confident” that the huge tax bill will be reversed.
At a press conference Tuesday, the European Commission’s competition commissioner Margarethe Vestager announced that the European Union has ordered the government of Ireland to collect up to €13 billion, or about $14.5 billion, in back taxes from Apple. The sum represents Europe’s largest tax penalty and a significant increase over the 1 billion figure floated around ahead of the ruling.
According to a 130-page judgment seen by The Financial Times, the European Commission (EC) is set to rule Tuesday against Apple’s sweetheart tax deal it struck with the government of Ireland back in 1999.
The Commission is reportedly set to demand that Ireland recoup over 1 billion euros in back taxes from the iPhone maker, or circa $1.12 billion.
“Apple will on Tuesday be hit with Europe’s largest tax penalty after Brussels ruled that the company received illegal state aid from Ireland,” warns the financial newspaper.
Following months of back and forth between Apple and Ireland’s independent planning body An Bord Pleanála, plans for a massive $1 billion data center in Galway County have been approved, reports Business Insider. “Despite opposition from a number of individuals and local businesses,” Apple’s been granted the go-ahead to build the first stage of the data center on a 197-hectare site.
The facility will support Apple’s online services for customers in Europe, including the iTunes Store, App Store, iMessage, Maps and Siri.
Apple is considering a major expansion of its key Irish operation just months after completing a massive €300 million (about $335 million) development in the country, according to Independent.ie Monday.
Already employing more than 4,000 people in Ireland and its Cork plant in Hollyhill, the latest expansion should deliver a multi-million euro boost to the move.
The European Commission’s investigation into Ireland’s tax deals for multinational corporations could have a “material” impact on Apple, the company said in a 10Q filing to the S&E Commissions this week. If it’s determined that Dublin’s tax policies represented unfair state aid, the Cupertino firm could suffer significant losses.
The European Commission publicized its ruling that Apple benefited from a favorable Irish tax rate, arguing that Apple’s funneling of revenues and earnings to Ireland, where the Cupertino firm cut a favorable tax deal with the Irish government in the late 1980s and early 1990s, constitutes illegal state aid, The Wall Street Journal reported Tuesday.
Responding to these accusations, Apple issued a written statement denying it’s received preferential treatment from the government of Ireland. Apple is urging the need for corporate tax reform, insisting its tax arrangements in Ireland are perfectly legal.