Friday, 2 September 2016

Irish tax breakfast could be UK's serfs dinner

My Daily Record Column for today
IMAGINE you woke up one morning to find out someone offered your country enough money to fund the health service for an entire year. 
Then you read every political party, bar one hardline grouping, have put up their collective hands and said: “No, we’re fine, our indebted country and creaking health system doesn’t want the money. You keep it.”
This is what has happened in Ireland, a country where GPs can charge you 50 euros for turning up at the surgery and people long ago stopped believing in pots of gold at the end of the rainbow.
The European Commission have ruled that Apple, the makers of mobile phones and laptops, paid less than one per cent tax on European profits for years through their Irish base.
By 2014, Apple were paying 0.005 per cent tax on European profits.
Sweet, if you are Apple. Sour when you consider that is 50 euros tax on every million euros in profit generated.
Commissioner Margrethe Vestager said the arrangement with the Irish government is illegal under state aid rules and Apple must pay Dublin 13billion euros and the interest on top.
Apple’s billions in back taxes could build 100,000 homes for the poor or pay off a chunk of the nation’s debt.
The trouble for Ireland is that Ireland doesn’t want the money. 
For 40 years and more, the cornerstone of Irish economic policy has been a low corporate tax rate that attracts inward investment. 
The iPhone-makers are one of more than 700 US companies who have a European foothold in Ireland. They employ a combined 140,000 people across the island.
So, do you want the 13billion euros or not? 
Go look up the answer at Google or ask a friend on Facebook, or any other multinational using an Irish stepping stone.
The sound of hand-wringing in the Dail, Ireland’s parliament, can be heard this side of the Irish Sea.
Most commentators, as far as can be fathomed, back the Irish government’s stance to appeal the decision.
Irish finance minister Michael Noonan, vowing to fight Europe on behalf of the world’s richest company, went straight for Ireland’s famine heart.
“To do anything else, it would be like eating the seed potatoes,” he said. 
These Irish jobs are at stake and Apple, backed by the US government, won’t brook the European Commission meddling. 
For Apple, this is a drop in the ocean. The company generated about $4.45billion a month last year and the back tax – equivalent to about $3000 for every man, woman and child in Ireland – works out at three months of profit.
But no way are the Irish getting a share of Apple’s pie.
Apple chief executive Tim Cook said: “Ireland always does the right thing. You can always count on that.”
If there’s an iPhone app for generating smugness, that guy was the first to download it.
Why should we worry about Ireland’s tax dilemma? Well, I get the feeling whichever direction we turn, Ireland’s breakfast is our dinner.
Just as Alex Salmond sought to emulate the Celtic Tiger across the northern “arc of prosperity” (what a cracker that was) his plan for an independent Scotland depended on facilitating any passing multinational with a lower than UK corporate tax rate.
Events have changed all that and now the entire UK finds itself cast as the continent’s international tax haven.
Eurosceptic Tories have been eager to press Theresa May to offer Apple an even better deal than Ireland does, if that is possible.
I fear that’s what Brexit means on Tory terms, rendering craven homage to global companies and turning your workforce into the cyber-serfs of the 21st century.

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