Ireland finds itself in the spotlight following Apple executive’s testimony to the U.S. Senate Committee on Tax Strategies, and the ultra-low tax nation is now calling for an international crackdown on tax dodging by multinational corporations.
Irish ministers are doing double duty in the wake of Apple’s appearance before the Senate, looking both to deflect blame from Ireland’s multinational-friendly tax structure and to encourage other countries to close loopholes that allow large corporations to skirt the tax laws of the countries they operate in. The minister in charge of attracting foreign companies to Ireland is now saying that those companies need to be brought under control, according to Reuters.
“They play the tax codes one against the other,” Richard Bruton told Irish state broadcaster RTE, “and I think we do need international cooperation through the [Organization for Economic Cooperation and Development] to deal with the aggressive nature of that.”
Ireland has long been criticized by other European nations for its low corporate tax rate of 12.5%. The low rate encourages companies to locate pieces of their operations in Ireland, just for tax purposes. Apple, Google, Yahoo, Intel, and many other firms do this.
The soft economy across Europe has seen the criticism against Ireland grow as other countries tighten their fiscal belts. The country’s neighbors have grumbled for years about potential tax revenue being lost to Ireland. The country so far has turned back the attacks, but now the scrutiny on Apple has led Ireland to consider pushing for tighter rules on multinationals.
The U.S. carries more weight economically and politically than any individual European nation, and could make things difficult for those companies headquartered in Ireland.
“The U.S. Congress, if they wanted to, could wipe out those 150,000 real jobs,” Irish think-tanker John FitzGerald told Reuters.
