Oh well, sometimes you have to take the lumps and the bruises. The Irish government is contemplating legal bumps and bruises after the Court of Justice of the European Union ruled that Dublin would have to take a payment of €13 billion in back taxes from Apple.
Oh well.
The Irish government said it would “respect the findings” of what has been described as a landmark court ruling.
Respect is one thing. Now how to spend this, well, windfall.
Said a government statement: “The CJEU has found that the tax paid was insufficient and that a greater amount of taxation was required to be recovered. Ireland will of course respect the findings of the court regarding the tax due in this case.”
The Irish Times reported that the Department of Finance said the judgment provides the final determination in the case and that the process of transferring the money, which has been held in escrow, to Ireland will now begin.
The report added that the court's decision sparked a volley of criticism of the government by opposition parties, as well as calls to clarify what the wider implications of the judgment were for Ireland.
And it went on to state that Sinn Féin’s finance spokesman, Pearse Doherty, said the ruling was expected.
“I always believed that this day was inevitable. I believed that that would be the judgment. And I thought it was absolutely a colossal mistake for Fianna Fáil and Fine Gael to continue to defend this practice and to use taxpayers’ money – this puts debates about bike sheds into the ha’penny place,” Doherty told RTÉ radio’s Today with Claire Byrne show.
“They spent millions of euro of our money defending this, trying to prevent us getting €13 billion of taxes. And remember when they took this case in 2014, this €13 billion would have built tens of thousands of social and affordable houses right across the State,” Doherty said.
“It could have transformed Irish society. It could have prevented a lot of the pain that we’re seeing as a result of this policy."
Mr. Doherty said that “stateless companies” were at the core of this issue.
Well, yes. But said companies are also major employers and it was in significant part a fear that a high tax levy on Apple might scare away the computer giant and other multinationals that was a reason for successive Irish governments taking a pass on a sum that would indeed be transformative is terms of government spending on the likes of housing and infrastructure.
The Department of Finance, according to the Times report, reiterated Ireland’s position, which is that it does not give preferential tax treatment to any companies or taxpayers. It said that the case involved an issue that “is now of historical relevance only” and that two tax opinions provided by Revenue to Apple in 1991 and 2007 that formed the crux of the case are no longer in force.
“Ireland has already introduced changes to the law regarding corporate residence rules and the attribution of profits to branches of non-resident companies operating in the State,” the DoF said.
“Ireland is an active participant in international tax discussions and has also made necessary changes to its taxation regime as international tax rules have developed over time.”
Those international rules should protect Ireland, at least to a degree, should Apple or other multinationals develop cold feet due to tax levies.
Apple and others operate in Ireland because it is in the EU and is a doorstep into a giant market. The court's ruling applies to said giant market so moving to, say, Romania, does not necessarily offer any significant advantage.
So now there is the matter of the Apple tax falling from the tree. Certainly the money can be applied to much needed matters such as housing. It can be used to improve the lives of many. It can be used to improve infrastructure. It can be used to make Ireland an even more attractive place for the likes of Apple to invest. Perhaps some of it can be used to foot the entire bill for a new Casement Park in Belfast. Now there's a thought.
For the record, Apple reported net income of $96.99 billion in its 2023 fiscal year. Apple's global revenue amounted to $383.29 billion in that same year.
