Regulators failed to prove that Apple's tax treatment by Ireland was an unfair subsidy and were wrong to find Apple's Irish branches were responsible for profits it made in Europe, the European Union court said.
Council President Charles Michel's most recently revamped plans for the EU's multi-annual financial framework notes that the Commission will put forward in the first semester of 2021 proposals on a digital levy, with a view to their introduction "at the latest" by January 2023.
Jason Collins, partner and head of tax at law firm Pinsent Masons, said: 'Apple's victory shows that European courts are unwilling to call beneficial tax regimes state aid, even when created to attract foreign investment - provided they apply the rules consistently.
Both ASI and AOE are based in Cork and both are non-resident companies for tax purposes, according to the Irish Times. It shouldn't take over half a decade to decide what a multinational corporation should pay in tax. The Trump administration has said that the European Union is unfairly targeting US companies.
A broader worldwide debate is underway about how to tax large multinational technology corporations. Apple said the effective tax rate used by the European regulators is "a completely made-up number".
The Commission also claimed that Ireland had allowed Apple to attribute almost all of its Eu earnings to its head office in the country, despite existing only on paper and effectively avoiding taxes across other member states.
"The only comfort here is that the court agrees with us that we can use state-aid tools to look at fiscal state aid as well", Vestager said in an online event today. "This case was not about how much tax we pay, but where we are required to pay it. We're proud to be the largest taxpayer in the world".
Tax activists, however, said the decision reinforces their call for new rules.
The European Commission had argued Apple and Ireland did a deal that let Apple pay too little tax over many years - as low as 0.005pc.
While the Apple tax case isn't legally related to other antitrust enforcement that Ms. Vestager is pursuing, Wednesday's decision may dent her reputation and cast doubts on the solidity of other cases. Therefore, the decision of the court in Luxembourg is so important for us. She suffered a setback a year ago when judges faulted a decision targeting Starbucks Corp. over its tax deals with the Netherlands. But the government, disputing the commission's decision, brought the case to the court.
Paolo Gentiloni, European Commissioner for the economy, said: "Fair taxation is the springboard that will help our economy bounce back from the crisis". In a statement, the Irish government said it was pleased with the ruling.
The commission found in 2016 that Apple had directed profits from the subsidiaries - which are responsible for all of the company's sales outside of the Americas - to a "head office" with "no employees, no premises, no real activities".
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