Mattie McGrath (Tipperary, Independent) | Oireachtas source

I am sticking to Apple but there are a few bad apples always in every pack. Deputy Grealish might know that.

This is about the corporate tax rates. We said it is not about tax avoidance. It clearly is not. It is not about tax evasion. It is not about the justness of our tax system. Ostensibly, it is not even about tax. It is about illegal state aid, full stop. The Minister, Deputy Noonan, also stated that the full amount of tax was paid in this case and that no state aid was provided.

He has become highly expert in what happens in companies now. It quite simply is not true and Irish citizens must not be treated as simpletons. Please respect the electorate that gave the Government its mandate and which chastised it so severely in the last election. It is true the decision has given rise to robust debate about Ireland facilitating global corporations to avoid paying tax, about Ireland's corporate tax rate and about the European Union trying to influence Ireland's future taxation strategy by moving to take away Ireland's sovereign right to set our own tax rates and policies. We cannot allow the European Union to interfere in this regard. While all these issues will require much debate in the weeks, months and years ahead, they all are strangers to the current illegal state aid decision. I honestly believe that in my heart, as I believe do many Members on the other side of the House.

Competition law has been a key component of European law since the signing of the 1957 Treaty of Rome. While the rules on state aid have been a central plank of competition law policy for nearly 60 years, I firmly believe our politicians and media are feigning an ignorance of the law and appear intent on obscuring the picture while denying that Ireland has done any wrong in its dealings with Apple.

What are the facts behind this Apple decision? I believe the facts are that Ireland and Apple were running two horses in the same race. One was fully legitimate and paid its taxes in Ireland. However, the second was anything but in its aims and objectives. It was a structure that facilitated Apple in laundering its global profits through Ireland - our little Éire we are commemorating in 2016 - at a tax rate of close to zero by facilitating a tax haven status for Apple through, inter alia, the double Irish. There used to be talk of double whiskeys and double brandies but a double Irish now has a funny name as well. Ireland effectively became a tax haven. However, no law was broken and these tax avoidance schemes were legal. They may be perceived as being unjust or immoral, depending on one's position on the argument. If long-standing European Union competition law has been breached in the manner in which the scheme was put together and executed, that then is a different matter. The European Commission suspected this might be the case and began an investigation that culminated in last week's decision. I remind the Minister of State, through the Chair, that state aid law is not rocket science. The tax structures facilitated by Ireland clearly amounted to state aid that was the whole idea behind it. It can be described as state aid because that is what it was. The question is whether the state aid in this case was discriminatory or selective. I believe it was totally discriminatory and selective. Did the state aid distort or threaten to distort competition by favouring certain undertakings? Clearly, the scheme distorts favourable treatment in respect of Apple. It is as clear as night follows day that it bestowed favourable treatment on Apple by reducing Apple's tax liabilities and, therefore, granted Apple a competitive advantage over other corporations that could not avail of it.

Never mind the other corporations, what about the PAYE workers to whom my colleague, Deputy Michael Healy-Rae, and many other speakers have referred? What about the small business people, whether farmers, shopkeepers, undertakers, hairdressers or whatever? What about Paddy the plasterer and all the men who went to the wall during the recession? They were followed and persecuted to the last drain of blood by the Revenue. Sheriffs came pounding in the door on behalf of the Revenue and no matter what other debts they had, regardless of whether it was to feed their children or whatever else, the Revenue had to get its money. No one could not talk to the sheriff or to Revenue. I salute the Revenue Commissioners in many cases but they were heavy-handed and wanted the last drop of blood in this regard. However, what is going on in this case with two standards and the riding of two, three or who knows how many horses? The misery that has been visited on the people with the amount of penalties imposed because of austerity is shameful. We were going to burn the bondholders but we did not. We could not do anything against Europe but all of a sudden, we have taken a major gripe against Europe. I have no love for Europe and have no love for the way in which we thought they would listen to what Britain did after Brexit. I even suspect they want us to leave as well and to be rid of us. I suspect they want us not to be a nuisance to them past Britain, here off the west coast, and to just get rid of us. Perhaps we have served them well and perhaps they have got enough from us. However, the ordinary people must be looked after. There must be justice for all and there is no point in having people out there paying everything with punitive, scandalous interest. Every so often, one sees cases highlighted in or leaked to the media about the number of penalties and court cases. Moreover, the number of penalties they have added on is both disgusting and immoral but not for these people. They can have cosy arrangements.

Another question is whether the arrangement was exclusive to Apple and the answer is probably not. Although we do not know it for sure, it is believed that a number of global corporations availed of similar arrangements through Ireland. However, it is incontrovertible that the structure was not available to other companies and competitors, especially our own small and medium-sized enterprises, SMEs, our indigenous businesses and people here. In general, for example, an Irish competitor or would-be competitor, which are very important if we are trying to have a recovery in the economy - and people are watching this - would not have global profits to launder and as such, would be obliged to pay standard corporation tax of 12.5%. This compares to what was suggested or alleged in the case of Apple, namely, a rate of 0.005%. That is the difference and is why we want our educated young entrepreneurs to be able to have confidence, to have fairness and parity of esteem and to be supported; not to be blindfolded with their hands tied behind their backs in favour of these big guys. My understanding is that it is believed Ireland did not seek clearance from the Directorate General for Competition in Europe prior to implementing the controversial Apple tax structure. That is very important. If this is true, and sin an ceist, it is quite telling in its own right that Ireland preferred to keep such dodgy tax arrangements a secret. We have many dark secrets in Ireland and this will be one that may end up being exposed and I believe that if it is, it will be to our shame. It is my estimation that the European Union decision at this point, much as I dislike the European Union, is the correct one, namely, that Apple was in receipt of illegal state aid. Are EU laws clear as to what happens next? This is important and I refer to my previous remarks about pursuing people literally to the grave. The State must recover the illegal aid in full from the recipient. There is no latitude in this regard and I refer to the argument that is creeping in at present about it being retrospective. I state from the bottom of my heart that the only retrospective issue involved with illegal state aid is the full requirement to recoup retrospectively all this illegal aid.

I am familiar with a wonderful small company in my native county. Those involved had a sick mother of the house, who has died subsequently, and were operating for years in an agribusiness. They were honest people who had their C2 certificates and their certificates of taxation clearly from Revenue, on the understanding they were charging 12.5% as a service industry. The company was doing that and providing a service to the farmers which was vital. I fought this case with the Revenue but got no satisfaction. After five or six years of trading, even though the company had tax clearance from Revenue for the entire time, Revenue decided the company was trading illegally and should have been charging a rate of 21% or 23% as it is at present. I called for an independent investigation into the Waterford tax office. Those involved were persecuted, despite that woman being on her death-bed. She was a young woman in her 30s with two small children and she died in the middle of it. The manner in which Revenue treated them was merciless and here we are now with Revenue having questions to answer. Why did Revenue not see this sooner? Why is everyone paying their PAYE and all the different levies and taxes with which they have been hit with the recession? We must pay and it does not sit well with me when Members in this House who owe taxes themselves have stated on different radio programmes that they failed to so do, that they disclosed wrongly to and misled Revenue. This is not acceptable to anyone and I reiterate that we must work with Revenue. However, there cannot be double standards and one cannot issue a tax clearance certificate for three, four or five years and then decide the people were operating incorrectly. Where is the level playing field and the fairness then because they were an ordinary, small company and not a conglomerate?

We have many conglomerates here too and I salute them, that is, the American direct investment jobs, which we badly need. However, we cannot have this image being portrayed of us that we are shady, that we have the double Irish or that we have two or five horses in the same race. We must be straight and direct and we must support our own indigenous firms. We must see the way in which they are being pursued relentlessly at present. Are we now going to pay the costs in this regard? I understand that half a million already has been expended in fighting this case. Let Apple appeal it. It has plenty of resources with which to appeal it and it will appeal the decision anyway. We should sit back, discuss our business here and try to get our house in order and let it pay for the appeal. Why should the taxpayers make more fat-cat lawyers fatter and richer, as they have done in supporting NAMA and all the skulduggery that is going on in that agency to which Deputies here already have referred? We have a lot of washing to wash out here and I note we have good dry days at present with sunshine for drying as well. There is much dirty linen to be washed and it is disgraceful that we are being watched by the world. We must support what we have but we must steady the ship. We must hold our heads up high as a proud country, not one that is shady and open to secret sweetheart deals. As I stated, I am in favour of keeping the foreign direct investment here.

I am not saying that we should get rid of them all and we will be happy. We need them and we need the jobs and the service industries that support them. They all pay their taxes, including the self-employed people who support Merck, Sharp and Dohme. It gives great employment as well as service industry employment, together with all the other big industries in Galway to which Deputy Grealish referred in the context of future investment.

It is now autumn when apples fall from the trees. They are picked and brought to Bulmers to make good cider. It is time we sorted the good apples from the bad. We should get rid of the bad ones because they are culls which we do not want or need. We must go after that money and get it back for our hospitals, roads and the education of our young people. We must have a perception of being fair, honest, straight and open for business. We are not suspect or into shady deals. The Minister may shake his head all he likes but I believe I am telling the truth. I can be proven wrong on this when it comes to it, but I have no intention of supporting the appeal. Let Apple make its own appeal. It has the resources and we can see what happens.

We can call back our European commissioner who does not have the moral standing to resign, like anyone else would if they felt they were in support of our country or wore the green flag. I know his jersey was disappointed on Sunday, but the green flag is meant to be worn by our commissioner and it is time he started wearing it.

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