Sunday 23 October 2016

Apple in Ireland is a major employer and not just an empty shell

Micheál Martin

Published 03/09/2016 | 02:30

European Commissioner Margrethe Vestage Photo: Eric Vidal/Reuters
European Commissioner Margrethe Vestage Photo: Eric Vidal/Reuters

I understand that many people look at Tuesday's ruling on Apple's tax liabilities and wonder why we don't try to just 'take the money and run'. This is exactly what the Commission intended when it issued statements intended to manipulate public opinion, rather than give a detached and fair judgment free of spin.

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The Commission's claims simply can't be taken at face value. It clearly wanted people to believe that there is a big pot of cost-free money to be collected from a dastardly foreign corporation.

Yet the announcement did not contain any legal justification for the claim that Ireland has acted illegally. It also falsely sought to present Apple in Ireland as an empty shell, rather than what it is; a major employer and our single largest taxpayer.

In fact, the more information that becomes available, the clearer it is that for Ireland the potential costs of accepting the Commission's ruling represent a deep threat.

Ireland's concern has to be more long-term than trying to get hold of a once-off fund, which may in turn then have to be handed over to other countries. We have to look at its impact on employment and protecting the tax base which pays for our schools, hospitals and pensions.

As part of this, we have to stand resolutely against the agenda of trying to find ways of giving control of tax policy to the Commission.

Vitally, we also have to show industries that employ hundreds of thousands of people that we will not head off down a populist route, now the dominant approach of Ireland's hard Left, of presenting them as the enemies of society.

Ireland has no option but to appeal this judgment rigorously. But it must also understand that there is an attempt under way to diminish tax sovereignty and we must challenge this rigorously.

Changes in our tax laws mean that there is no longer any issue concerning shell companies - what is involved is major investors with a vital economic importance for Ireland and similar countries.

A starting point must be for the Government to get its act together.

The fact that the Government was so woefully unprepared for Tuesday's announcement is very serious. Added to the weak response to the Brexit vote, it confirms a failure to prepare for potential threats, even when they are imminent.

There is a broader issue in this for another day, but in terms of the Apple decision, it must now form a small expert group to be charged with overseeing the legal, diplomatic and public elements of the response.

A lot of ground has been lost by the shambles of this week's response, where simple figures and arguments were not available as Commissioner Vestager launched her carefully planned effort.

We must be in a position to put our position clearly and forcefully to governments and the media throughout Europe.

We should formally communicate to the Commission that we oppose the linking of this matter with its agenda for harmonising tax policies. This link was made by the Commissioner in her official statement and was completely inappropriate for what is supposed to be an independent, non-political process.

As part of this, we should demand an acknowledgment of the fact that the Irish Revenue Commissioners, unlike bodies in many countries, works independently of government. It applies the law without reference to ministers or agencies. The Commission is entitled to say that it thinks the Revenue made a legal error; however, no evidence has been presented on this. What it is not entitled to do is to say that this was a decision intended to give unfair state aid to one company.

In addition, our Government should come off the fence and say that we object to an agenda which is increasingly focused against multinational corporations which are headquartered in Europe's smaller countries. This is a continuation of a failed policy which wasted a decade in trying to break up Microsoft because the Commission believed it had a permanent monopoly in web browsers and office software.

Ireland must apply fair tax laws to all citizens and companies based here. We must continue to support the international effort to ensure transparency. What we cannot do is accept that we can be told to act as the world's tax collector and to retrospectively apply this.

Five years have been spent in a massive investigation dedicated to justifying itself. This matter will drag on for at least another five or six years. The decision to lodge a legal appeal is an executive matter, which next week's Dáil motion will simply support.

Fianna Fáil has proven time and again that it is a constructive contributor to the European Union and we are the only active Irish voice for strengthening the Union at a time of rising threats.

However, we are absolutely committed to the idea that tax must remain a national matter. The treaties we have negotiated and supported reaffirm this.

The Commission has no legal right to pursue an agenda of undermining tax sovereignty. Its decision to put public spin ahead of a detached presentation of the issue of Apple's tax shows a distorted agenda. Its failure to show respect for policies vital to the success of smaller members is a major concern.

Contrary to the spin, there is no immediate windfall available to Ireland to make our budget choices easier in the next few years - but there is an important principle at stake and the vital need for us to protect the long-term success of our major employers and taxpayers.

Micheál Martin is the leader of Fianna Fáil

Irish Independent

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