Some experts think the most likely outcome is that Ireland would simply be forced to be less accommodating with multinationals in future.
That could limit its ability to attract international investment, although the country hopes this could be balanced by planned OECD tax changes that may handicap low tax competitors, like Singapore and Switzerland, Killian said.
The Commission also criticized the fact that Apple and Ireland’s 1991 tax agreement had lasted 16 years – far longer than the five year limit that many other EU countries apply when issuing rulings about how transactions should be treated for tax purposes.
One function of that tax agreement was that while revenues from the sale of Apple’s hot products like the iPad soared, the group’s taxable profit in Ireland did not.
An unnamed tax advisor to Apple “confessed that there was no scientific basis for the figure” that Apple would declare as its Irish taxable income, the Commission noted, from minutes of meetings between Irish tax authority officials and the advisor.
The minutes of another meeting say that a tax advisor for the company stated it was his view that Apple was deliberately shifting profits into the lightly taxed Irish operation. (Reuters) [eap_ad_3]