Ceann Comhairle,
The Dáil has been reconvened today to debate the motion before it because it reflects the seriousness the Government attaches to the Decision announced last week by the European Commission.
The Commission’s conclusion that Ireland granted undue tax benefits of up to €13 billion to Apple in a way that transgressed EU State Aid rules is so profoundly wrong and damaging that it demands an immediate, clear and strong response.
Governments over the years have made clear, as this Government has, that Ireland did not and does not do deals with corporates, large or small.
It is not how we do business.
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.
Today, 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 in efforts to improve and reform the international tax system.
That’s the work we have been involved in at the OECD and international level for some time. That’s why we have changed legislation to demonstrate our bone fides in this regard.
Ireland, as a country, is naturally blessed in so many ways – from the beauty of our land to our wonderful people. But it has to be acknowledged that we also have disadvantages when compared to some rival economies.
Geographically we are a peripheral island, at the edge of a continent and with a large ocean beyond.
We have a relatively small population and therefore a limited domestic market for what we produce.
We are not overly endowed in natural resources.
These characteristics have historically stunted deep industrial development.
In fact, as we look back at our history as an independent country, especially this year, it is easy to see how our early decades were wasted ones in terms of economic development as we tried and failed to make a go of things on our own.
It was when we decided that economic security – and thus true national independence – could be secured only by opening up to the world, by attracting foreign investment and by building up our trading relationships, that things began to turn around.
This progress was further underpinned by our decision to join the then European Economic Community.
And let me be very clear to those who might seek to use this issue to drive a wedge between this country and the European Union, Ireland has benefitted - and continues to benefit - enormously from being part of the EU. And we will continue to be part of the European Union for the years ahead.
We share a set of democratic values and a community of law with our EU partners and friends. Our citizens, our farmers, our businesses all enjoy access to a single market of 500 million people and the freedoms that come with membership.
Of course, this does not mean that we agree with every decision taken in Brussels - clearly not. And, as the EU evolves and expands, we must continually assess and review how to ensure that our national interests are best served by our membership.
Ireland’s decision to pursue economic prosperity by turning out to face the world was the right one and it has served us well.
The figures speak for themselves.
Last year saw the highest ever level of employment in IDA client companies – more than 187,000 people directly employed, across a range of sectors with every region in Ireland posting net gains. In fact, the IDA estimates that about 1 in 5 jobs in the economy are directly or indirectly supported by inward investment.
In 2015 alone, the IDA won 213 investments for Ireland, including many globally known companies.
Each job represents a life line to an individual or family, money to be spent in the local economy, supporting domestic jobs and helping to sustain vibrant communities.
Ireland makes no apology to anyone for seeking to advance the well-being and prosperity of our people.
This is our sovereign right as a nation and we object at attempts to restrict us making policies for our own people in accordance with competencies that are our own right under the Treaties of the EU.
Competition has never been stronger for mobile investment. All countries, big and small, compete to win their share, and nobody takes it more seriously than we do.
Yes, we compete, and we compete hard. But we do so fairly and within the rules.
The investment decisions that companies take are rarely simple. There are many complex factors involved.
Years of experience have enabled us to hone our offer and to present the best possible case to decision-makers as they consider where to locate.
Yes, our competitive, transparent and consistent tax regime - and our rock-solid commitment to our 12.5% corporate tax rate - is part of that offer, but it is just one part and it is never the sole one.
Businesses choose to locate in Ireland because we have a proven track record in delivering a good return on investment.
They do so because of the availability of a young, talented and hard-working workforce.
They do so because of the steps we have taken to create a positive business environment, not least through the hundreds of measures put in place under the Action Plan for Jobs.
They do so to secure access to European markets – and in the wake of the decision of our nearest neighbour to leave the EU this may well become a more decisive question for some.
They do so because of the quality of our education system and because of proximity to the cutting-edge Irish and international companies based here.
The picture of Ireland painted by the Commission in its Decision – as a country prepared to play fast-and-loose with the law to gain unfair advantage - could not be more damaging or further from the truth.
This is not a Commission finding that stands by a small country that has played 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.
For that reason, while the Revenue Commissioners will now take the steps necessary to collect the sum involved as required, it will be held in escrow pending the final outcome of the legal proceedings.
And, we will appeal this decision with the strongest possible assurances from the Revenue Commissioners that there was no departure from applicable Irish law, that there was no preference shown in applying that law, and that the full tax was paid in accordance with the law.
It is important to us that businesses and investors should have confidence and certainty in the rules that apply and in how they will be taxed. Ireland offers that certainty in the way we treat all companies fairly and equally.
The Commission’s decision has done great damage to that goal, and not just in Ireland’s case.
If the situation in Europe is to be that tax rulings can be revisited and set aside by the Commission even decades after the event, investors will simply not know where they stand when they locate in Europe.
Have no doubt about it, that uncertainty will be weighed carefully in the minds of investors and will count against European countries – and not just Ireland - when they compete for mobile investment unless this decision is challenged and overturned and certainty is restored.
The Commission’s decision is especially unhelpful as it comes at a time when serious work is underway at international level to reform what is widely acknowledged to be a broken system for corporate tax.
This consensus view has led to unprecedented agreement on 15 OECD BEPS reports, representing a comprehensive global response to the problems identified.
Ireland is playing a full and active part in this work.
We have been an early-mover in the BEPS project, both domestically and at EU level. We are a strong supporter of tax transparency and administrative cooperation as keys to tackling the global problems of tax avoidance and aggressive tax planning.
The core principle underpinning this work is that tax should be paid where economic activity takes place.
Within the EU, Ireland supported the June European Council conclusions on the fight against tax fraud, evasion and avoidance, and money laundering. We have also been party to key developments in exchange of information on tax rulings and country-by-country reporting, as well as recent agreement on the Anti Tax Avoidance Directive.
Real reform, though complex and hard-won, is happening and is delivering as a result of countries working and cooperating together. We are strongly of the view that this is the best way forward. The Commission’s decision cuts across this delicate work.
Of course, there is always scope for further improvement. For that reason, the Government has decided that a review of Ireland’s corporation tax code should be undertaken by an independent expert to be appointed by the Minister for Finance.
In doing so, we have made it clear that the review will exclude any possibility of change to the 12.5% rate.
Before concluding I would like to say something about the long, productive and overwhelmingly positive relationship Ireland has enjoyed with Apple.
Apple first came to Ireland in 1980 – just three years after it was incorporated in the US – and began making personal computers in Cork. Within ten years of its arrival, it employed more than 1,000 people.
When its latest round of investment is complete, Apple will employ 6,000 people in Ireland. We are delighted that Apple chose Ireland, and delighted that it chose to stick with Ireland. It is a tribute in no small part to the dedication and excellence of the people who have worked with it and for it.
Apple is a welcome and valued part of the community in Ireland – and not just the business community. I look forward to this long remaining the case.
Ceann Comhairle,
As I said when I began, the House today has an opportunity to stand together to send out a strong, clear message.
We do not accept the decision the Commission has made.
We are determined to ensure that it does not stand. That’s why we will appeal it to the European Courts.
We do not offer special favours or deals on tax –everyone is treated equally and according to the law.
We are unshakably committed to our 12.5% rate of corporate tax.
We are determined to ensure the highest international standards in transparency in tax, and we will continue to work with others to advance reform at international level.
I therefore commend the motion to the House.
ENDS