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In 2016, the EU ruled that the Irish State provided state aid to Apple, which was deemed to be illegal.

As a result of this, Apple are required to back-pay €13 billion to the Irish exchequer.

From a oblivious viewer, this seems to be slightly unfair, considering that Apple was following the direction of the State's government (or governmental agency).

Is there some legal principle, or explanation, which means that even though Apple was complying with the understood law in that jurisdiction, they are now required to pay the EU tax fine to the Irish State of €13 billion?

From what I can see, this ruling mostly benefits the Irish State, and punishes Apple, despite the illegal state aid being an action of the state, and not the corporation.

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  • They were told they didn't have to pay a particular cost, then it was discovered that actually they should have paid it, so now they have to. Apple is in exactly the same position it would have had if the tax had been paid properly, if not even better as it has had the ability to leverage those finds in the intervening years. If I tell you that you can use this car, don't worry about refilling the tank, and it is found later that you did need to fill the tank (because actually it wasn't even legal for you to borrow it) that's just justice.
    – user4657
    Dec 11, 2019 at 11:11

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The EU has established rules about member governments subsidising industries. The intention is to ensure that trade in the EU is not distorted by government incentives, so that factories get built in the most efficient location rather than where a government offers the biggest subsidy. This is the mirror image of the rules which prohibit tariffs; governments cannot protect their own industry from competition either by imposing tariffs on imports or by providing subsidies to exports.

The Irish government was found to have provided an illegal subsidy to Apple in the form of a tax reduction made especially for Apple. Hence the tax break was invalid and effectively did not exist. Legally Apple therefore had to pay their back taxes.

As to why Apple had to pay after being assured that they would not have to, its a basic principle that civil servants cannot change the law merely by saying something. If a civil servant tells you that you don't need to pay tax when you do, then the civil servant is simply wrong. You could use their opinion as a defence against criminal charges of tax evasion, but you would still have to pay the tax.

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