Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

It is very difficult to be absolutely certain of the detail in retrospect. The first opinion was in 1991, which is 26 years ago. The Senator may recall, if she has done some research into corporation tax, that Apple came to Ireland in 1980. Right through the 1980s - like other exporting companies - it had export sales relief. Export sales relief meant that exporting manufacturing companies paid zero tax. Under Irish law, no manufacturing company that was exporting paid tax. This exemption was given by the European authorities under state-aid rules. Apple manufactured right through the 1980s, principally in Cork, and it did not pay tax because that was the agreement around export sales relief. It was only in and around 1991 that Apple began to come into the tax net. It was at that point Apple looked for an opinion on what its tax liability would be under the new rules.

If one traces it through the 1990s, first there was a 10% rate, which applied to manufacturing industries that were exporting. There was a case that ran all the way to the Supreme Court involving McCanns, the banana people. They asked to define the machine turning bananas to ripen them on the other side as a manufacturing activity. They won their case. I am speaking from memory now so members should not take this as a legal opinion but this is the story. As a result of that it was extended to all manufacturing companies. Manufacturing was defined very widely and included packaging, for example. Putting teas in tea bags would have been within the exemption or mechanically turning bananas over to ripen them. When one is trying to get a fix on what actually happened in 1991, there is a totally different context under Irish tax law. Revenue is absolutely categoric that the methodology it used was fully in accordance with Irish law.