Daily Tax Update - September 14, 2016: European Parliament Members Debate European Commission Ruling Regarding Ireland's Tax Deal With Apple

European Parliament Members Debate European Commission Ruling Regarding Ireland’s Tax Deal With Apple:  Today, members of the European Parliament (MEPs) debated the European Commission’s (Commission) ruling that Ireland granted Apple, Inc. “selective tax treatment” that gave it a “significant advantage over other businesses.”  As a result, the Commission ordered Apple to pay $14.5 billion (€13 billion) in back taxes, plus interest.  Both Apple and the Irish government have vowed to appeal.  According to a press release, today’s debate revealed that the Commission’s verdict has “won wide support from MEPs.”

Nike Prevails in Foreign Tax Credit Dispute:  On September 13 and 14, the US Tax Court entered stipulated decisions which provide that Nike, Inc. had no deficiencies for its 2011 (FY11) and 2012 (FY12) tax years.  In April 2015 and July 2016, Nike filed petitions in US Tax Court that challenged the IRS’s reduction of Nike’s foreign tax credits.  The April 2015 petition challenged a proposed tax increase of $31 million for FY11, while the July 2016 petition challenged a proposed tax increase of $222.8 million for FY12.  In its petitions, Nike defended its distribution of foreign tax credits among certain of its foreign subsidiaries.  The stipulated decision regarding FY11 can be accessed here and the stipulated decision regarding FY12 can be accessed here.  

House Ways and Means Committee Considers Tax, Trade Enforcement Bills:  Today, the House Committee on Ways and Means marked up a number of bills relating to tax and trade enforcement, including the United States Appreciation for Olympians and Paralympians Act (H.R. 5946) exempting Olympic medals from income tax; the Empowering Employees Through Stock Ownership Act (H.R. 5719); and Prevent Trafficking in Cultural Property Act (H.R. 2285).  Ways and Means Chairman Kevin Brady’s (R-TX) opening statement can be accessed here.             

Miscellaneous Guidance:  Revenue Ruling 2016-23 provides the rates for interest on tax overpayments and underpayments for the fourth calendar quarter, beginning October 1.  The rates will be: 4% for overpayments (3% in the case of a corporation); 1.5% for the portion of a corporate overpayment exceeding $10,000; 4% for underpayments; and 6% for large corporate underpayments.