Thomas Pringle (Donegal, Independent) | Oireachtas source

All that means is that Deputies will head for the hills a little later than expected. As I stated this morning, this debate is basically an exercise in optics. The Government has already taken the decision to appeal the European Commission's tax ruling. It arranged a debate on a motion to appeal the decision to create a facade and suggest the Dáil has a role or input in the decision making process. This morning, I asked the Taoiseach whether, in the event that the Dáil rejected the motion and voted against appealing the Commission's decision, the appeal would proceed. In such circumstances, the appeal would proceed because the Government has already taken a decision. As such, it does not matter whether the Dáil meets. All we are doing is trying to save face and provide a veneer of cover for the decision taken by the Independent members in government. It also ensures Fianna Fáil and Labour Party Deputies will vote with the Government on the motion. Such backing for the Government gives it some political cover for a decision it has already taken. This is what annoys me most.

Would it have been a problem for the Taoiseach to indicate the Government would consult Parliament before making a decision on whether to appeal the decision? We could then have had a debate and the Government would at least have given a semblance of having listened to different views and made a considered decision on whether to appeal the decision. That would have been a better approach, one which would have gone some way towards making Deputies feel they were part of the process and had some relevance. Many commentators describe the Dáil as irrelevant and that is certainly the case when one considers the way in which the decision on the matter has been arrived at. All that is left for Deputies to do is to place on record their views on the Commission's decision and the process by which we have arrived at this point.

When one considers the Government's response to the European Commission's decision, it is clear we are all expected to don the green jersey and go out and bat for Apple because batting for Apple is batting for Ireland. In this regard, it is worth repeating a view expressed by many previous speakers. Who batted for Irish citizens during the bailout process when the European Union made Ireland carry the can for the bailout of European banks? At that time, no one in government stood up to defend citizens.

The Government's failure to bat for citizens is brought home even more by the example cited in the Commissioner's press statement in which she referred to the position that obtained in 2011, which was the point at which the financial crisis in Ireland was deepest. In that year, Apple Ireland and its various entities, recorded profits of €16 billion. If these profits had been taxed at the 12.5% corporation tax rate that applies here - the lowest in the developed world - the €2 billion generated for the Exchequer would have resulted in a much smaller Exchequer adjustment in that year. Furthermore, we would have exited the bailout many years earlier than we did. It would also have eased the burden of adjustment on citizens, including those who are dependent on social welfare, the disabled and those young people who had their benefits cut, as well as the lone parents whose rights and entitlements were savaged by the Labour Party in the previous Government. This sum would have made a major difference to the State and its citizens but it would have meant the then Government donning the green jersey to defend its citizens.

In looking at this, the EU arrived at the decision that this was state aid. It did not arrive at the decision that our corporation tax rate is wrong or unjust or anything like that. It arrived at the decision that this was state aid granted to Apple by the Irish State.

I am no expert on European law but from what I have read of state aid, it is a simple idea. Basically, under competition rules a government cannot do anything to give a preferential benefit to any corporation or sector of an industry or allow either one or the other to benefit over other companies operating in the same system. That is very simple. The Commission has decided that we granted state aid to Apple.

The only defence that I can see - Deputy McGrath from Fianna Fáil used it - is to maintain that the offer was available to everyone and the fact that everyone did not avail of it is not our fault. Deputy McGrath's argument is that the offer was available to everyone. In other words, the defence is that we actually are a tax haven and it amounts to the Government coming out and publicly admitting to the world that we are a tax haven and we do deals with corporations to minimise or annihilate their tax burden in order that we can keep them here. That is fair enough. If that was the case and it was available to everyone and if the Government can show that it was available to everyone, then the European Commission case would not stand up and it would have been unable to make the judgment because every multinational corporation in Ireland could have availed of a 0.005% tax rate. That seems to be the only defence that the Government can use.

The only other defence I can think of is for the State to argue that the Commission was outside its remit in looking at our taxation policy. However, it did not look at taxation policy; it was looking at state aid rules. Therefore, I do not think that is any defence and I do not see how the State is going to defend it. We might actually win the case on some banal technicality under the EU treaties but that would be a technical decision rather than a decision on whether state aid took place. That might be the outcome and it is probably the best outcome the Government can hope for.

It is vital that we keep in mind what the tax foregone could have done for this country. In 1991, when the decision was originally given to Apple, it was a very different company. As I understand it, around that time Apple was in danger of going bankrupt and disappearing as a company altogether. I imagine what probably happened was that Apple went to the Government and the Revenue Commissioners and explained that it was in deep financial trouble and that if it did not get a better deal from the Government and Revenue on taxes then it would be gone. Deputy Barry spoke about the hard political decisions earlier when referring to Apple in Cork. The hard political decisions in 1991, before the Celtic tiger, had to take cognisance of the 2,000 people working in Cork and their families, all of whom were dependent on Apple. If the company went wallop or bust then those jobs would have been gone. That was the political reality of the decision. It was why the Government did the deal and gave it to Apple.

That was probably bad enough because it gave Apple state aid in a deal that was not available to everyone else. However, rolling over the deal in 2007 is difficult to understand because by that point in 2007 Apple was probably the biggest corporation in the world and had hundreds of billions on deposit in the banks. Apple no longer needed that favourable deal. The idea that Apple would leave had it not got that deal in 2007 has been exposed as a lie since Apple invested €1 billion in a data centre in Galway, as was announced last year. Even if Apple had not got that deal in 2007 the company probably would not have left.

More interesting, the Commission said in its press release that the decision only counts prior to 2014. What happened in 2014? Apple changed its structure in Ireland and the loophole no longer applied. The interesting question is why Apple changed its structure in Ireland. Could it have had anything to do with the fact that in June 2014, the Commission wrote to the Government with a preliminary decision indicating that it believed there was a state aid issue and it would make a finding that the Government gave illegal state aid? It has taken the Commission two years to publicly make the decision, but much has happened in those two years. Considerable activity has taken place. Ireland has sought to clean up its corporation tax reputation. We introduced country by country reporting in 2015, which was seen as a revolutionary thing to do, but in the background we had the preliminary judgment of illegal state aid for Apple. Then, Ireland adopted the European Commission anti-tax-avoidance directive, yet, in the background, we were still waiting for the decision to come out. One might think all that makes us a responsible country but this was only happening because the Government was expecting a negative decision and it was going to be in the wrong in any event.

The Government says we have to appeal to protect our reputation internationally and that we have to fight and defend this decision. In 2013, Washington investigated Microsoft transfer pricing arrangements with Irish subsidiaries, which reduced its tax bill by $2.4 billion. That affected our reputation. The Westminster Public Accounts Committee has looked into Google and how it does deals through Dublin for sales in England. That interferes with its operations there. In Rome, the Italians are investigating tax arrangements in Ireland. The Australian Parliament has focused on the double-Irish taxation structure in its investigations. According to the Sunday Business Post, the EU Commission has sought relevant tax agreements from Irish authorities in respect of at least six other multinational companies operating in Ireland.

Our reputation is in the gutter. What we should do is admit that we did something wrong and that we provided illegal state aid. We may have done it for the best of reasons, to maintain a business in Ireland that employed many Irish people. However, we should collect that tax and use it for the benefit of Irish citizens. We should wear the green jersey to benefit Irish citizens rather than multinational corporations.

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