Staggering. That is the only way to describe the rush of revelations emerging from last week’s decision by the European Commission to condemn the tax avoidance schemes erected by Ireland to boost the EU-derived profits of Apple Inc. Today, in an emergency session of Dáil Éireann, Richard Boyd Barrett of the Anti-Austerity Alliance–People Before Profit (AAA–PBP) added to the general sense of shock, at least among genuine democrats, by examining other aspects of the scandal. It seems that a number of multinational conglomerates based in this country, including Apple, have been essentially calculating for themselves the amount of tax they should be paying to the Irish state. And the state, in the form of the Revenue Commissioners and successive governments, have agreed to abide by those determinations!
“The average amount of what are called deductions – parts of companies’ profits that can be written off from their tax liabilities as costs – jumped from an average of approximately €2 billion in 2004 and 2005 to €21 billion in 2011.
…we do not have the figures and cannot get them from Revenue for four or five years after the fact, which is another scandal.
The amount of tax at 12.5% that these companies could write off jumped over four or five years by €19 billion.
The greatest jump in that write-off came [in 2007] when it increased from €6 billion to €19 billion before increasing to €21 billion within a year or two.
It may well have increased much more afterwards but we do not have those figures. We need to see them.
From 2007, total taxable income in the corporate sector dropped from €56 billion to €37 billion. That nearly €20 billion is almost exactly the same as the deductions allowed.
[Certain multinationals were] allowed to write their own tax bills indefinitely. The Government colluded to cover this up until now.
In 1991, a basis proposed by Apple for determining the net profits of Apple Computers Accessories, now the ASI branch, was agreed by Revenue.
Apple told Revenue that it had a proposal on how the latter should calculate its profits. It did that again in 2007.
Does any other taxpayer get the opportunity to tell Revenue how to calculate his or her tax bill?
This is the Government that will deduct unjust property taxes from people’s wages if they do not pay. This is the Government that will send police out against anti-water charges protesters because they are unable or unwilling to pay unjust water charges. This is the Government that inflicts the brutal austerity imposed by the troika to pay off the gambling debts of banks and financial speculators regardless of the hardship suffered by ordinary people.
When it comes to Apple, Google and Facebook, however, we protect them and they can make their own tax arrangements.
This is what happened. No arm’s length principle, no equality, no tax justice. They tell Revenue how to calculate their tax and Revenue does it.”
I am literally dumbfounded. There is a thin line between tax avoidance and tax fraud, and the Irish political establishment has proven itself to be standing on the wrong side of that line; and it has done so for decades. Current and former ministers who sat in governments or coalitions formed by Fianna Fáil, Fine Gael and the Labour Party, are all culpable in the Apple Tax controversy. Collectively they have brought the name of this island nation into disrepute in the eyes of our European neighbours and the world.
Furthermore, as with the endemic corruption associated with the era of the Celtic Tiger, the moral integrity of the republic itself has been undermined by the actions of the political and business classes. The public perception of water and property taxes as punitive charges upon an unwilling population seems reaffirmed with every new twist and turn of the scandal. We have arrived at a situation where a significant number of citizens now believe that the state has little right to conduct its business in a manner determined by politicians and civil servants inculcated in a culture of habitual malfeasance. Contempt for authority and cynicism about legality, never far below our post-colonial surface, is the new normal.
All of which is a useful reminder that Charles J. Haughey was no rotten apple in the barrel. He was the fucking barrel!