In an interview with the Irish Independent, Apple CEO Tim Cook call the European Union’s recent ruling which saddled his company with a $14.5 billion tax bill “total political crap.”
On Tuesday, the European commission ruled that Ireland illegally provided state aid to the Cupertino-based company, by applying artificially low tax rates to Apple’s earnings, and not collecting $13.5 billion euros of taxes owed to it over a 10 year period. Cook says the ruling was politically motivated due to anti-U.S. sentiment on the part of the EU.
“I think that Apple was targeted here,” Cook said. “And I think that (anti-US sentiment) is one reason why we could have been targeted. People in leadership positions in several countries tell me that this is the agenda. I don’t know where that comes from. But what I feel strongly about is that this decision was politically based, of that I’m very confident. There is no reason for it in fact or in law.”
Cook agrees with the U.S. finance minister, Jack Lew, who said the “retroactive” tax bill was an attempt by the EU to grab taxes owed to the US treasury. “I think that’s exactly what it is,” he said. “I think it’s a desire to reallocate taxes that should be paid in the US to the EU.”
The EU says the benefit of the “Double Irish” loophole used by Apple was that the company paid and effective tax rate of 0.005% in 2014 and 1% in 2003. Ireland’s standard tax rate is 12.5%
“They just picked a number from I don’t know where,” Cook said. “In the year that the Commission says we paid that tax figure, we actually paid $400m. We believe that makes us the highest taxpayer in Ireland that year.”
The Irish government and Apple both disagree with the EU’s decision, and have lodged formal appeals.
Despite the tax battle, that will likely go on for years, Cook says Apple will not scrap planned projects and investments in the region. “We’ve been spending a lot of money on building out a large location in Cork. We have a 37-year-old marriage with Ireland and it means something to us. It’s a very deep relationship. Every time I go there it brings me such joy. It is an integral part of the company.”
“I feel like Ireland stuck with Apple when it wasn’t easy to stick with Apple and now we’re sticking with Ireland,” he added.