Investing.com – As the European Commission (EC) ruled on Tuesday that Ireland should recover up to €13 billion ($14.5 billion) in back taxes from Apple, the firm’s chief executive officer (CEO) Tim Cook responded that the ruling had no basis in fact and pledged to fight the case.
Margrethe Vestager, in charge of competition policy in the European Union (EU), said earlier on Tuesday that "the Commission's investigation concluded that Ireland granted illegal tax benefits to Apple, which enabled it to pay substantially less tax than other businesses over many years."
Cook denied the allegations in a letter directed to its European customers on Tuesday.
“The opinion issued on August 30 alleges that Ireland gave Apple a special deal on our taxes,” Cook said.
“This claim has no basis in fact or in law. We never asked for, nor did we receive, any special deals,” he explained.
Cook further noted that the company had always worked with Irish tax authorities in order to comply with its laws, in line with any other firm doing business in the Celtic Tiger, as the country is known.
He furthered accused the EC of attempting to change laws retroactively.
“We now find ourselves in the unusual position of being ordered to retroactively pay additional taxes to a government that says we don't owe them any more than we've already paid,” Cook explained.
In a separate press release, Apple said that both it and Ireland plan to appeal the decision and was confident that it would be overturned in EU courts, though “the process is likely to take several years.”
As far as financial results, the iPhone maker said that they expect no near-term impact and the tax rate guidance would also be unaffected.
The company did note that it would probably have to place an unknown amount of cash in an escrow account that would likely be reported as restricted case on Apple’s balance sheet.
Shares in Apple Inc (NASDAQ:AAPL) were last down 1.04% at $105.71 in Tuesday’s pre-market trade.