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September 3, 2016

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Ireland cabinet to challenge EU on Apple tax ruling

IRELAND’S cabinet agreed yesterday to join Apple in appealing against a multi-billion-euro back tax demand that the European Commission has slapped on the iPhone maker, despite misgivings among independents who back the fragile coalition.

A government spokesman said following the cabinet’s decision that it would ask parliament to endorse the legal challenge next Wednesday.

Finance Minister Michael Noonan has insisted Dublin would fight any adverse ruling ever since the European Union began investigating the US tech giant’s Irish tax affairs in 2014, arguing that it had to protect a tax regime that has attracted large numbers of multinational employers.

But at an earlier cabinet meeting on Wednesday he failed to persuade a group of independent lawmakers, whose support is vital for the minority government, to agree to fight the ruling that Apple must pay up to 13 billion euros (US$14.5 billion) in tax to Dublin.

Ireland’s opposition party, Fianna Fail, also favors challenging Brussels. The government should therefore easily win parliamentary support to appeal against European Competition Commissioner Margrethe Vestager’s ruling that Apple’s low tax arrangements in Ireland constitutes illegal state aid.

Apple, anxious to defend its own interests, has already said it will lodge an appeal. For Fine Gael, the main Irish coalition party, a broader principle is at stake. It wants to take on Brussels to safeguard Ireland’s decades-old low corporate tax policy that has drawn in multinationals such as Apple, creating one in 10 jobs in what was once an impoverished country.

The Independent Alliance, a group of five lawmakers, had called for a review of how tax is collected from Ireland’s large cluster of multinational companies before it considers a challenge.

“We are very, very keen that from now on multinationals should be seen to be paying their fair share of tax,” Transport Minister Shane Ross of the alliance said.



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