Ireland’s debt agency has invested disputed taxes collected from Apple in low risk, highly rated euro-dominated fixed income securities, mainly short to medium-term sovereign and quasi-sovereign bonds, it said in an annual report.
The European Commission ruled in August 2016 that Apple had received unfair tax incentives from Dublin in breach of EU state aid rules and ordered Ireland to recover more than 14 billion euros, including interest, from the iPhone maker.
While Apple and Dublin are appealing against the ruling, saying the tax treatment was in line with Irish and EU law, Apple nevertheless had to hand over the full amount, pending the result of the appeal – which will likely take several years.
The government said Irish taxpayers would be protected from any losses when setting up the fund. NTMA [National Treasury Management Agency] chief executive Conor O’Kelly said on Monday that the value of the fund was very likely to fall unless the interest rate environment changes… “But there is no loss to the state. Apple and Ireland have agreed that the pot is the pot, whatever is there at the end so we don’t have to make up any difference. That’s an agreed investment policy.”
MacDailyNews Take: The EU should cover any losses, not Apple or Ireland, should a miracle happen and Apple/Ireland win the appeal.