A man looks at his phone as he walks past an authorised apple reseller store in Galway, Ireland August 30, 2016. REUTERS/Clodagh Kilcoyne
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The days when big U.S. technology companies could easily slice tax bills in Europe are coming to an end.Tuesday, European Competition Commissioner Margrethe Vestager sent the strongest signal yet that she won't abide these strategies when she demanded Apple pay an estimated 13 billion euros ($14.5 billion) in back taxes.The European Commission ruled that Ireland gave Apple illegally favorable tax treatment, letting it pay an effective tax rate on European profits of 1 percent in 2003 and down to 0.005 percent in 2014 . Apple and Ireland vowed to appeal.Ireland is phasing this out, although companies have until 2021 to adjust.About six months ago, Netflix Inc. told an investor that the company will likely pay higher international tax rates than other large U.S. technology companies currently pay.Even if Apple has to pay billions and other tax strategies fizzle, Ireland's 12.5 percent corporate rate means it's still likely to trump the U.S. as a preferred corporate tax domicile.
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