Apple-EU Clash Over $14 Billion in Back Taxes, Explained

Apple Inc. will have to pay a $14 billion tax bill to Ireland after the EU’s top court ruled that the country’s approval of beneficial tax positions dating back decades amount to illegal state aid—preferential tax treatment given to a company over others.

The European Court of Justice on Tuesday sided with the European Commission after an eight-year fight over Ireland’s tax treatment of two Apple affiliates. It ruled that a lower court win for Apple should be overturned because judges incorrectly decided that the commission’s regulators had made mistakes in their assessment.

The ruling is a boost for EU ...