A report earlier this month from Bloomberg claimed that Apple could owe more than $8 billion in back taxes if the European Commission rules that its Ireland setup is illegal. Speaking to the Financial Times today, Apple CFO Luca Maestri commented on the ongoing European investigation and said that he estimates Apple will have to pay $0 in back taxes, assuming the investigation outcome is “fair.”
Maestri had the following to say regarding the European Commission’s investigation into Apple’s tax practices:
“This is a case between the European Commission and Ireland and frankly there is no way to estimate the impact right now, we need to see what the final decision is going to be. My estimate is zero. I mean, if there is a fair outcome of the investigation, it should be zero.”
For those unfamiliar with Apple’s practice, it funnels all European revenue through Ireland. In Ireland, it has a special agreement with the Irish government that means it pays just a 2.5 percent tax rate instead of the normal 12.5 percent. This practice has been the subject of a European Commission investigation for a while now, but the investigation was recently extended and expanded.
Last month, CEO Tim Cook labeled claims that Apple doesn’t pay its fair share in taxes as “political crap.” Cook said that Apple pays more taxes than anyone and while it would love to bring overseas revenue back to America, it would cost 40 percent for the company to do so. This comment, however, seem to focus primarily on the claims that Apple avoids U.S. taxes, with Cook avoiding the topic of the Irish tax investigation and its agreement with the Irish government.