EU: Vestager hits back at former Official in Apple Tax spat

Neelie Kroes, the former commissioner for both the Commission’s competition and digital policy departments, on Thursday penned a Guardian op-ed in which she criticized the decision to go after Apple’s tax arrangements on state aid grounds.

Current competition commissioner Margrethe Vestager this week said Ireland had broken state aid rules by accepting Apple’s tax scheme and effectively letting the company—a major employer in Ireland—get away with paying as little as 0.005% in corporation tax.

She suggested that Vestager’s decision represented a “radical new approach to so-called transfer-pricing rules that determine where profits shall be allocated,” thus undermining the ability for EU member states to write their own tax laws.

Vestager has already said that transfer pricing, where subsidiaries pay one another for intellectual property, was not a factor in the Apple-Ireland case, although her department has still not published the full nonconfidential version of her decision.

“You cannot change the rules of the game through ad hoc state aid enforcement, and then seek retroactive recovery for unpaid taxes,” Kroes wrote.

On Friday the Commission’s chief spokesperson, Margaritis Schinas, responded to a question about Kroes’s piece in the Commission’s midday briefing.

It was a polite reply in phrasing but not content, as Schinas drew attention to the fact that Kroes is these days a public policy board member of another big U.S. tech firm, Uber, which also uses elaborate tax planning schemes. She is essentially a lobbyist now.

“We understand that it may be sometimes challenging to reconcile the role as a former commissioner with the temptation to publicly express the views of those in Silicon Valley or elsewhere who oppose the Commission’s decisions,” Schinas said.

Full Content: Fortune

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