Catherine Murphy (Kildare North, Social Democrats) | Oireachtas source

In 2012, US Senator Carl Levin, who was the chairperson of the Permanent Subcommittee on Investigations in the US, began to speak about Apple's tax affairs in Ireland. He did not mince his words. He asked one simple question. Why Ireland? It was his belief that Apple had had a privately negotiated agreement with our Government since 1991, and by 2003 the result was that Apple's corporate tax rate was less than 2% and sliding.

In 2012, Mr. Michael Collins, the Irish ambassador to Washington, was quick to use the opportunity to point out the obvious, that 2% was a far cry from our already generous 12.5% corporate tax rate. We believe the corporate tax rate should remain at 12.5%, but it should be paid.

Last week, on the "Today with Sean O'Rourke" radio programme, Mr. Donal O'Donovan, the former IMF director, asked if, when these rulings were issued in 1991 and 2007, the Revenue Commissioners had checked with Brussels whether they constituted, or would constitute, illegal state aid. He pointed out that if we went ahead with such agreements without recourse to Brussels, we can hardly now complain that Brussels, when it finds out about these rulings, finds them to be illegal. The Minister for Finance, Deputy Noonan, has to answer that question today. Did the Government or Revenue inform Brussels about that aspect of this deal?

Over the past week, the European Commission issued its ruling to which nobody on this side of the House has been privy. Within hours, however, the Government announced its decision to enter into an extremely lengthy and exceptionally costly battle to repudiate the Commission's ruling that we were owed €13 billion. Nobody seems to have given much consideration to the fact that the European Court of Justice has a especially strong track record in upholding the rulings of the European Commission. This appeal kicks an expensive can down the road, and in doing so, it creates a vacuum of uncertainty which commentators on all sides have described as dangerous.

The IDA boss, Mr. Martin Shanahan, speaking on "Morning Ireland" yesterday, agreed that uncertainty makes his job and that of the IDA much more difficult. Interestingly, Mr. Shanahan agreed that there is little or no evidence from any credible, independent sources that the ruling will have any likelihood of impacting on our ability to attract or keep multinational corporations here. Multinational jobs are valuable, as are indigenous ones.

The ratings agency Fitch has publicly said that there is no issue here. It is interesting to note that when the same ratings agency has nice things to say about us - things the Government wants to hear - we are bombarded with the good school report. In this case, however, the Government has been noticeably silent on the opinion from Fitch. The ratings agency went on to say that any potential risk of us accepting €13 billion was limited. Fitch highlighted the already attractive 12.5% corporate tax rate and our high human development as promoting an attractive business environment for multinationals.

Professor Joseph Stiglitz, the Nobel prize-winning economist, has repeatedly said it is wrong to appeal. He described the comments of the Minister, Deputy Bruton, as "utter balderdash".

If we look at the employment multipliers, it is clear to see that, valuable as FDI is, it is not always the job engine it is perceived to be. That is yet another reason we should place as much emphasis on indigenous small and medium businesses which employ seven out of every ten people in this country. Such companies have often struggled to meet their tax liabilities, particularly in the past seven or eight years.

The Government's decision to appeal is made in the context of a negative interest rate environment, with some corporates recently starting to charge negative interest on corporate bonds. I presume the National Treasury Management Agency, NTMA, will hold this €13 billion in an escrow account, but what about any interest accruing? Even at a rate of 3%, at the end of three years we would have an interest yield of €1.1 billion. The question as to what might happen with that has not been addressed, but that issue needs to be addressed today.

I would like the Minister to clarify what steps are being taken to ensure the escrow account is run for the maximisation of return in the event that Ireland loses this appeal. I would also like the Minister to clarify who ultimately signed off on this deal in 1991 and where it originated. Did Apple approach the Government or vice versa? Was the IDA involved and, just as important, what role did Revenue have at that point? Where does Revenue stand on this? These questions need to be answered here today.

Put simply, this deal was not made available to other entities because it could not be. By its very nature it has to be a bespoke deal and therefore it can be construed as having distorted competition in the sector. The real question is, under whose watch was this bespoke deal done, tailored and delivered to Apple?

Perhaps most important of all, what has to be considered is the impact of the decision on our GDP. The recent controversial 26% rise in GDP might have been impacted by deals such as the onshoring of intellectual capital, maybe by Apple but certainly by companies or the aircraft leasing industry. Given that our GDP is ongoing and will have an impact on our economic relationship with Europe, it is vital we consider the ramifications of the decision concerning the Apple ruling. The more that GDP is inflated, the more we will have to pay in hard cash. The former IMF director, Mr. Donal O'Donovan, said this is not just a technical issue but also a political and moral one. On all three counts I absolutely believe that to be the case.

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