The European Commission has announced an investigation into whether Apple is taking advantage of favorable tax laws in Ireland.
“In the current context of tight public budgets, it is particularly important that large multinationals pay their fair share of taxes,” said Joaquín Almunia, the European Commission vice president in charge of competition policy, in a statement Wednesday. “Under the EU’s state aid rules, national authorities cannot take measures allowing certain companies to pay less tax than they should if the tax rules of the Member State were applied in a fair and non-discriminatory way.”
As Ars has reported before, Google, Facebook, and many other (mostly tech) companies have used a quirky Irish tax law arrangement that allows organizations to incorporate in Ireland but legally route money through other jurisdictions, such as the Netherlands. It’s all done in the name of drastically reducing tax burdens. The general term is called “transfer pricing.”
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