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Irish cabinet decides to appeal Apple tax ruling

Xinhua, September 2, 2016 Adjust font size:

The Irish cabinet decided on Friday to appeal the European Commission's ruling that Ireland had supplied illegal state aid worth 13 billion euros (14.57 billion U.S. dollars) to Apple.

The decision was taken after a half-hour cabinet meeting that defused the danger of a split with independent ministers.

The terms of the appeal will now be drafted by the Office of the Attorney General, and the Dail Eireann, lower house of Irish parliament, will meet to debate the issue next Wednesday, according to Ireland's public broadcaster RTE.

A motion will also be tabled seeking the Dail Eireann's support for the appeal and a commitment to transparency in taxation of the corporate sector, RTE reported.

On Wednesday, the cabinet meeting was adjourned until Friday because several independent ministers asked for more time to study the Apple tax ruling before deciding whether to back the appeal process.

On Tuesday, the European Commission ruled that Ireland granted undue tax benefits of up to 13 billion euros to Apple, saying that "selective treatment" allowed Apple to pay tax rate of 1 percent on EU profits in 2003 down to 0.005 percent in 2014.

The findings are a result of the culmination of a three-year investigation by Competition Commissioner Margrethe Vestager into tax arrangements for Apple, dating back 25 years.

In a statement, the EC said the benefit is "illegal under EU state aid rules, because it allowed Apple to pay substantially less tax than other businesses. Ireland must now recover the illegal aid."

In response to Tuesday's Apple tax ruling, Irish Finance Minister Noonan said he "disagrees profoundly" with the ruling and will seek cabinet approval to appeal to the Court of Justice of the European Union.

At the center of the Apple controversy are two of the company's subsidiaries, Apple Operations Europe and Apple Sales International.

These firms were registered in Ireland, however, they were controlled in the United States where they held their board meetings. Revenue authorities taxed the companies on the basis of their activities in Ireland, however, the EC says both companies should have been taxed by Ireland on the basis of their worldwide income. Endite