Apple has noted in its annual 10-K filing to the Securities and Exchange Commission that it could be subject to changes in its tax rates as new Irish tax legislation comes into effect. According to The Wall Street Journal, Apple has said in its filing that due to economic and political conditions, “tax rates in various jurisdictions may be subject to significant change”.
The Cupertino giant also added in its filing that the European Commission may require changes to existing tax rulings which could increase Apple’s taxes in the future. Additionally, the EC may require Ireland to recover from Apple past taxes that may be “deemed to have constituted state aid”. In a letter to the Irish government published last month, EC said it had reached the “preliminary view” that tax deals struck with Apple in Ireland in 1991 and 2007 constituted state aid.
“Apple paid less than €20 million ($25.4 million) in taxes in Ireland for each of the years 2010-2012 through the two Irish subsidiaries that the commission has focused on, according to the commission’s letter. Reacting to the EC letter, a spokesman for Apple said at the time that the company had “received no selective treatment from Irish officials over the years,” and that its tax payments “in Ireland and around the world have increased tenfold” since 2007. “We’re subject to the same tax laws as the countless other companies who do business in Ireland,” the spokesman said.”
A tax analyst in London has said that Apple could be asked to pay up to $200 million in back taxes, adding that Apple may agree to pay a smaller amount to settle, or may pay nothing at all.