Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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I thank the witnesses for their contributions to the committee. It was reported recently that in 2012 Google had revenues of €15.5 billion from its Irish operation, but it paid only €17 million in tax. That is an infinitesimal amount of tax. The reason it succeeded in paying so little tax is that it charged €11 billion of the €15 billion in administrative expenses to another one of its subsidiaries that was not tax liable here. That is quite extraordinary. It tallies with something somebody whom one might call a whistleblower who previously worked for one of these companies told me, that the amount these companies charged to administrative expenses, royalties, patents or whatever happened to be close to what they made in profits. It was blatant abuse of transfer pricing.

The point is that it appears to be self evident that Ireland is facilitating this practice to a far greater degree than anywhere else, which is why there is such an uproar about Ireland's position. One can compare the effective tax rate that the example I mentioned would give, which is approximately 2%, with the rates of other countries in Europe. In the UK the rate is 18.5% - these are not nominal rates, but effective rates - in Germany it is 20% and in France it is 35%. Some of these figures are disputed, but they are all considerably higher than the effective rate that the example I have given implies. Is it not self evident and obvious that whatever way we are applying the rules or directives on transfer pricing we are facilitating this tax avoidance to a far greater extent? In fact, it is not just tax avoidance but tax evasion. If one is abusing transfer pricing to this extent, it is tax evasion. We are facilitating that to a far greater extent than any other European state. Is that not the self evident conclusion one would draw from such examples?