Critics of Irish taxation should ‘reassess’ views, says Donohoe

Minister for Finance says original Apple decision caused ‘reputational difficulty’ to State

Paschal Donohoe: ‘Much of the criticism levied at Ireland has been given a very comprehensive answer today.’ Photograph: Alan Betson

Paschal Donohoe: ‘Much of the criticism levied at Ireland has been given a very comprehensive answer today.’ Photograph: Alan Betson

 

Minister for Finance Paschal Donohoe has said Wednesday’s ruling that Apple does not owe Ireland €13 billion in unpaid taxes should lead critics of the State’s corporation tax regime to “reassess their view … and some of the statements that have been made about it”.

Speaking in Government buildings today, Mr Donohoe said the 2016 finding by the European Commission that Ireland had struck a deal that gave preferential treatment to Apple had “caused reputational difficulty for Ireland during the many years in which is has played out. This is why the ruling of this morning is so important”.

Mr Donohoe suggested the ruling had overshadowed reforms that Ireland had made on corporation tax, and listed a series of actions undertaken in recent years that he said improved transparency on the taxation of multinationals.

“Much of the criticism levied at Ireland in relation to how we have handled the taxation matter has been given a very comprehensive answer today,” he said.

Ireland was ready to play its part in contributing to debates about multinational taxation, and in particular the taxation of the digital economy, the Minister said, but he gave a cool reception to suggestions that the European Commission could move to qualified majority voting on some reforms outlined in a new tax plan published by Brussels this morning.

Earlier, Taoiseach Micheál Martin said it was important “to make the point that Ireland is only entitled to revenue within the law. The essential judgment is … that Ireland is not in a position to get any of that revenue because it isn’t entitled to it. That’s the decision of the courts.”

Ireland’s industrial policy for more than 40 years had been focused on foreign direct investment, he said, “and it’s founded on a very basic strong relationship with those companies … and tax certainty has been critical to that success, and it has been a success story”.

Not ‘sorted’

Earlier in the day, Mr Martin denied that Apple was “sorted” in a tax deal involving Ireland. During Leaders’ Questions in the Dáil, Solidarity TD Mick Barry said sacked Debenhams workers had today chanted that they had been sold out while the computing giant was “sorted out”.

The Taoiseach defended Ireland’s decision to appeal the €13 billion decision, saying “Apple didn’t get sorted, and Apple is about workers too”.

Sinn Féin finance spokesman Pearse Doherty said the decision was only “half time”, and said that the ruling will attract more attention on Ireland’s corporation tax system.

“It is likely to be appealed and that’s what should happen. The issues here are serious. The general court has suggested Apple and our tax code was applied fairly and evenly and allowed for an Irish company to generate €104 billion profits and pay no tax here or anywhere else in the world on those profits.

“Cases like this put Ireland into the firing line and damages our reputation internationally,” he said.

Green Party finance spokeswoman Neasa Hourigan expressed disappointment at the ruling. “I feel it is vital that we ensure that large multinational companies pay a fair amount of tax,” she said. “While I need to study the finding in detail, this ruling seems like a setback for the EU commission and the move towards tax reform.

“Ireland needs to be a leader in supporting greater transparency and accountability in our tax system. Ireland also needs to champion global tax justice ... Tax justice demands that every company, small or large, pay their fair share.”

Labour finance spokesperson Ged Nash called for new rules to “ensure all multinational corporations pay their fair share of tax in the future”. While the court found that the commission had “effectively overreached”, he said this was not to say the previous tax rules were satisfactory.