Kenny says Irish tax regime will be defended ‘strongly’

‘We believe that our legislation is robust, that the application of that legislation is ethical’

 Taoiseach Enda Kenny with Hewlett Packard executives at the company’s headquarters in Palo Alto, California, yesterday. Photograph: Josh Edelson

Taoiseach Enda Kenny with Hewlett Packard executives at the company’s headquarters in Palo Alto, California, yesterday. Photograph: Josh Edelson

Fri, Jun 6, 2014, 01:00

Taoiseach Enda Kenny has said that the Government is ready to defend Ireland’s tax regime “very strongly” if the European Commission decides to investigate tax arrangements with international companies.

Speaking in California after meeting senior executives at Apple, including chief executive Tim Cook, Mr Kenny said he discussed with them “in a general way” Ireland’s “ongoing engagement” with the commission.

“This applies not just in the case of Ireland but across quite a number of countries and the information-gathering process that has been under way has been fully endorsed by Ireland,” he said. “Clearly, when the commission decide to make a statement about this, we will react to it.”

Formal investigation

The Taoiseach commented as reports suggested that the European Union may open a formal investigation as soon as next week into the tax arrangements that Ireland, Luxembourg and the Netherlands use to lure multinationals.

The European Commission is scheduled to discuss the issue at a meeting next Wednesday, Bloomberg reported. EU competition regulators said in September they were seeking information from the countries on whether the tax agreements amounted to illegal state aid.

“We believe that our legislation is robust, that the application of that legislation is ethical and we will be prepared to defend that very strongly in the event of any further statement or requirement from the European Commission,” Mr Kenny told reporters at the global head office of computer maker Hewlett Packard in Palo Alto.

The Taoiseach said Apple was a “very important employer” in Ireland with more than 4,000 staff and that the Irish operation’s range of activity was “fundamental to the company and to the future of the company”.

Apple came under fire at a US senate hearing last year for using “ghost companies” in Ireland that were “stateless” for tax purposes under Irish law to slash billions of US dollars in taxes off $74 billion (€54 billion) in income over three years.

The negative criticism arising from this investigation prompted the Government to decide to close the “stateless” tax loophole.