The European Commission ordered Apple Inc to pay Ireland unpaid taxes of up to $14.5 billion on Tuesday as it ruled the firm had received illegal state aid, Reuters reported.
Apple and Dublin said the US company's tax treatment was in line with Irish and European Union law and they would appeal the ruling, which is part of a drive against what the EU says are sweetheart tax deals that usually smaller states in the bloc offer multinational companies to lure jobs and investment.
The US feels its firms are being targeted by the EU and a US Treasury spokesperson warned the move threatens to undermine US investment in Europe and "the important spirit of economic partnership between the US and the EU."
Starbucks Corp has been ordered to pay up to $33 million to the Dutch state, while Amazon.com Inc and McDonald's Corp are also under investigation by the Commission, the EU's executive arm.
Apple's stock fell less than 1 percent.
EU Competition Commissioner Margrethe Vestager questioned how anyone might think an arrangement that allowed Apple to pay a tax rate of 0.005 percent, as Apple's main Irish unit did in 2014, was fair.
"Tax rulings granted by Ireland have artificially reduced Apple's tax burden for over two decades, in breach of the EU state aid rules. Apple now has to repay the benefits," Vestager told a news conference.