EU orders Apple to pay up to 13B euros in back taxes

BRUSSELS (AP) — Apple will have to pay up to 13 billion euros ($14.5 billion) plus interest in back taxes to Ireland after the European Union found Tuesday that the U.S. technology giant had paid next to no tax across the bloc's 28 countries for over 11 years.

The ruling is a dramatic escalation by the EU executive Commission in its battle to have multinationals pay their fair share in the region, where popular outrage over alleged corporate tax dodging is common after years of financial crisis and austerity budgets.

The EU says that many multinationals — including Starbucks, Fiat and Amazon — struck deals with EU countries to pay unusually low tax in exchange for basing their EU operations there.

EU Competition Commissioner Margrethe Vestager said that a three-year investigation found Ireland granted such lavish tax breaks to Apple that the multinational's effective corporate tax rate on its European profits dropped from 1 percent in 2003 to a mere 0.005 percent in 2014.

Following the bloc's decision on Apple, the U.S. Treasury Department voiced disappointment, saying retroactive tax assessments by the EU Commission "are unfair, contrary to well-established legal principles and call into question the tax rules" of the individual countries in the EU.

What's more, the U.S. government agency warned in a statement, the Apple ruling "could threaten to undermine foreign investment, the business climate in Europe and the important spirit of economic partnership between the U.S. and the EU."