Ireland ‘not good EU citizen,’ says economist Joseph Stiglitz

Argument that State dependent on multinationals simply ‘bogus’

Nobel prize-winning economist Joseph Stiglitz severely criticised Ireland at a press conference in Paris on Thursday over taxation of multinational corporations.

“In the area of taxes, Ireland has not behaved well, either globally or for their own citizens, or as an EU citizen,” said the University of Columbia professor.

"It is not [being] a good citizen to try to rob your neighbour. And what Ireland did is it tried to get revenue that would have gone to other European countries to be relocated into Ireland, to take a pittance out of that [in tax] and to do a deal where Apple is perfectly happy because they get their taxes reduced."

Mr Stiglitz referred to a 2016 decision by the European Commission which said Apple must pay €13 billion in back taxes to Ireland. Both Apple and the Irish Government are challenging that decision.

"And who pays?" asked Mr Stiglitz, referring to Ireland's low corporate tax rate and alleged sweetheart deals accorded to digital giants. "The rest of Europe is paying. You don't do that to your neighbours, to your partners in the EU. I view Ireland not only as a tax haven. It is not a good citizen of the EU."

But a few minutes later, Mr Stiglitz relented somewhat.

“I was a little too strong in what I said about Ireland,” he said, laughing. “I was a little shocked that they turned down the €13 billion from Apple. The country needed the money. The view that that would hurt Ireland’s reputation [to accept the payment from Apple]was totally wrong. Unless Ireland wanted to have a reputation as a confirmed tax haven . . . But if it wanted to say we’re going to play by European rules and we are going to be a normal economy, it actually made no sense to turn down that money.”

Source of prosperity

Mr Stiglitz said Ireland’s argument that it is a small country with few natural resources and little industry, whose prosperity relies on investment by multinational corporations is “bogus”.

He said evidence shows that “natural resources are not the basis of economic growth”. And “industry gets located where there are well-educated people, good infrastructure . . . countries like Japan and Korea attracted industries, educated their citizens and there’s no reason why Ireland couldn’t do the same.”