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Apple has had to pay €318 million in Italy to settle tax probe

Apple has had to pay €318 million in Italy to settle tax probe

Apple In Court
December 30, 2015

Apple has, according to a recent report, been ordered to pay some €318 million in order to settle a dispute concerning Cupertino’s mispayment of tax in Italy.

A costly tax probe

The news comes from the Italian language newspaper La Repubblica (via MacRumors). According to the report, Italian regulators took a close look at the amount of tax Apple contributed in March, and paid particular attention to Cupertino’s Irish subsidiary (which the company is said to use in order to avoid paying higher taxes internationally). The total Apple is said to have saved through reducing its taxable income in this way is a staggering €879 million between 2008 and 2013.

You see, because Apple headquarters its European operation in Ireland, Cupertino is able to pay a corporate tax rate of 12.5 percent (rather than the 27.5 percent charged in Italy). It’s a move that other companies also adopt, too.

Now, however, the iPhone maker has agreed to pay €318 million to Italy in order to settle the investigation. This is far less than the €879 million Apple is said to have avoided paying over the five years, but it does bring the matter to an early close.

This is indeed not the first time Apple has come under criticism concerning its tax in Europe. Before now, Tim Cook has also been called to defend Apple’s “tax avoidance” strategies in Washington, too. Despite this, Cook continues to assert that Apple has done nothing wrong: on “60 Minutes,” he referred to such accusations as “total political crap.”

Tim Cook’s most recent appearance on “60 Minutes,” on the other hand, saw the CEO discuss Apple’s stance on privacy with Charlie Rose. In the same interview, we also got to take a look inside Jony Ive’s secret design labs, we heard from Ive himself, and Rose also spoke with Angela Ahrendts, Apple’s senior vice president of Retail. It’s not the first time Cook has sat down with Rose, either.

The CEO’s opinion on today’s news, though, remains to be disclosed publicly. That being said, I don’t imagine Cook is happy at all with the move, even if it does bring Apple to a settlement with Italy.

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