With 93 votes to 36, the Irish Government has won support in the country’s parliament, Dáil Éireann, to appeal the European Commission claim that Ireland provided illegal state aid to tech giant Apple.
Last week, the European Commission’s competition commissioner, Margrethe Vestager, made a ruling alleging that “selecting treatment” allowed Apple to pay a tax rate of less than 1pc on European profits between 2003 and 2014.
She ruled that, as a result, Apple must repay €13bn to the Irish State, while adding that the €13bn could also be claimed by other European countries where Apple traded.
‘This is not a Commission finding that stands by the rules. It cannot be allowed to stand. We will, as the Government has made clear, appeal it before the European courts, with every expectation of success’
– AN TAOISEACH ENDA KENNY, TD
As a result, Apple immediately declared its intention to appeal, and a cabinet decision was made by the Irish Government to appeal following a Dáil debate.
Prior to the debate, a 16-page document was produced by the Department of Finance to explain the Government decision to appeal the ruling.
In an opening barrage, Taoiseach Enda Kenny TD described the ruling as “so profoundly wrong and damaging that it demands an immediate, clear and strong response”.
At stake is Irish sovereign tax law, the integrity of agreements with companies that have invested in Ireland and, of course, Ireland’s vital 12.5pc tax rate.
“It is not true that Apple was provided with more favourable treatment than others. There was no preference shown. The law was applied fully and appropriately, and Apple paid its taxes due in Ireland.
“This house has an opportunity to send a strong message that we stand together in challenging the presentation that the Commission has made, and that we are all determined that Ireland should continue to be at the forefront of efforts to improve and reform the international tax system.”Kenny rejected the European Commission’s depiction of Ireland as a country that was prepared to play fast and loose with state aid rules to gain an unfair advantage.
“This is not a Commission finding that stands by the rules. It cannot be allowed to stand. We will, as the Government has made clear, appeal it before the European courts, with every expectation of success.”
Dáil debate gets support of main political parties
Whether the €13bn carrot dangled by the European Commission was designed to mislead or sew dissension in the ranks, the decision to appeal the ruling was supported by the main political parties, including Fianna Fáil and Labour.
The decision to appeal came after a furious 10-hour debate.
At the end of it, a motion was passed that the Irish Government “commits itself to the highest international standards in transparency in the taxation of the corporate sector”.
It was agreed that no company received preferential tax treatment, and the Government affirmed its commitment to the 12.5pc corporate tax rate and the R&D tax credit.
A motion by Sinn Féin to immediately recover all payments due to the State, as per the European Commission decision, was defeated by 104 votes to 28.
Another motion by independents, including Mick Wallace and Clare Daly, that a sweetheart tax deal between Apple and the Irish State amounted to unlawful state aid was also defeated by 98 votes to 16.
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