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Apple tax court ruling a vindication for Ireland - Paschal Donohoe

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Minister Paschal Donohoe. Pic; Gerry Mooney

Minister Paschal Donohoe. Pic; Gerry Mooney

Minister Paschal Donohoe. Pic; Gerry Mooney

FINANCE Minister Paschal Donohoe has said a European court ruling in the Apple tax case is a vindication for Ireland that it does not give preferential treatment to any taxpayer.

Mr Donohoe said the long-running court battle had caused "reputational difficulty" but that the ruling that Ireland did not give Apple illegal state aid "will lead many to reassess their view of our corporation tax regime and of the statements that have been made about it".

He was speaking after the EU's General Court ruled on Wednesday that Ireland did not give Apple illegal state aid, overturning a decision by the European Commission four years ago that the tech giant owed the Irish exchequer over €14bn in back taxes.

Speaking on Wednesday afternoon Mr Donohoe said the ruling means "Ireland does not provide preferential tax treatment to any taxpayer" and the "decision is a vindication of our stance on this matter".

He told reporters: "It has always been our position that no preferential treatment was given to Apple and based on Irish law the correct tax was charged."

He said the case focused on a period that is now of historical relevance only and related to Revenue Commissioner opinions dating back to 1991 and 2007 that are no longer in force.

Ireland has already changed laws to deal with issues in relation to company residency and has made necessary legislative changes as international tax rules have changed over time, the Minister said.

He said as a result of these changes Irish incorporated companies cannot be stateless for tax purposes and the government has shut down structures that exploited gaps in anti-tax avoidance rules. Mr Donohoe said Ireland was one of only 23 jurisdictions found to be compliant with international best practice by the Global Forum of Tax Transparency.

He said the issue has been "hotly contested now over many years" but the ruling "shows that Ireland handled this matter in the correct way".

He said the changes Ireland had made "gained little traction in comparison to the criticisms"

Responding to new European Commission plans to pursue low-tax member states over advantageous corporate tax regimes that were announced earlier on Wednesday, Mr Donohoe said he expected this to be a "very active policy area for the rest of this year and next year".

He said: "Much of the criticism that has been levied at Ireland in relation to the taxation of Apple has been given a very comprehensive answer today.

"In the debate that is to come in the future on corporate tax policy and the taxation of digital companies, I think it's only fair to acknowledge that the ruling should have an effect on that debate and also to acknowledge over time the changes Ireland has already made."

The Court found the EU Commission failed to show that the two Apple companies at the heart of the case got a selective economic advantage through their tax treatment by the Irish Revenue Commissioners.

The Commission can now appeal the ruling to the European Court of Justice, a process that could prolong final judgement on the case for another two to three years.

Mr Donohoe said it was up to the Commission to decide on an appeal and declined to criticise the original decision by EU Commissioner Margrethe Vestager, describing her as a "very effective commissioner" who he has "deep amount of respect for".

Online Editors