It's a record-breaking penalty.
Apple CEO Tim Cook has written a letter to the Apple aapl community in Europe following a ruling on Tuesday by the European Commission that culminated in a record-breaking tax penalty for the tech company.
Concluding a two year investigation, the European Commission ruled that Apple owes $14.5 billion in back taxes as a result of questionable tax deals it agreed upon with Ireland in 1991 and 2007. The E.U. has accused Ireland of giving Apple illegal state aid, an accusation that Cook rebukes in his letter.
The letter details Apple’s contributions to Ireland. Cook writes that the company invested in the country when it had high rates of unemployment and its economy was suffering. He goes on to say that Apple’s operations in Ireland grew from just 60 employees 36 years ago to 6,000 employees, “and today the local economy is stronger than ever”—whether that’s correlation or causation wasn’t addressed.
The letter denies that Apple received any special treatment, saying it’s the largest taxpayer in both the U.S. and Ireland. However, the U.S. Senate has already established that Apple’s subsidiaries in Ireland have paid just 2% or less in taxes, though the corporate tax rate in Ireland is 12.5% (though it’s not uncommon for large companies to pay significantly less than the standard corporate tax rate).
Follows is the full text of Tim Cook’s letter: