Apple tax ruling tip of the iceberg - EU governments must do more

The European Commission today ruled that Apple received €13 billion in illegal state aid from the Irish government.

This decision follows the investigations on illegal state aid between the Dutch government and Starbucks, the Luxembourg government and Fiat, and the Belgian government for its ‘excess profit’ tax scheme.

Reacting to the decision, Jim Clarken, Chief Executive at Oxfam Ireland, said: “Ireland has benefitted from multinational investment but all companies should operate here under rules which are fair and which do not benefit some companies over others. Deals that exempt companies from paying their legitimate share of tax mean the ordinary taxpayers have to foot the bill.

“Apple is one of the world’s most well-known companies and Irish consumers want their favourite brands to do the right thing and pay their fair share of tax. A nationwide survey commissioned by Oxfam earlier this year found that the vast majority (86%) of people believe that big companies are using tax loopholes to dodge paying their fair share of tax. 83% believe vital public services like schools and hospitals in Ireland and across the world are suffering as a result.

“The Government now must move to end these practices for once and for all, and reassure citizens that sweetheart tax deals with either companies or individuals are a thing of the past. They cannot be tolerated, especially when public services are in vital need of investment.

“So far, multinationals found by the European Commission to have benefitted from sweetheart deals only have to pay the taxes they were previously able to avoid and no additional fines are levied. The status quo clearly does not pose a sufficient deterrent whatsoever.

“Adequate measures to prevent such deals in the future must include public disclosure of where multinational companies generate profits and where they pay their taxes, giving governments and citizens the power to hold them to account.

“A proposal earlier this year by the European Commission obliging companies to publicly disclose more information about their tax arrangements is too weak – it will only apply to the biggest of companies and the information they need to provide is too limited. The European Parliament and Member States need to strengthen these requirements by making them apply to all large multinationals, and multinationals must be forced to publish tax information for all countries where they are present. “In addition, the establishment of a public centralised register of beneficial ownership would allow citizens here and in developing countries know who is really behind companies and trusts. Without the financial secrecy which has wreaked such havoc to the global economy, tax evasion and avoidance would be much more difficult.”

Make Tax Fair:

When big firms don’t pay the tax they should, governments lack funds for schools, hospitals and tackling poverty. Tax dodging hurts us all, but it affects poor people the most. Developing countries lose three times more to tax havens than they receive in aid each year, according to the OECD. The money lost is enough to end world hunger twice over. We want the government to ensure Irish law and tax practice does not help companies or individuals to avoid tax by requiring companies to say publicly where profits are made and tax is paid and increase international tax cooperation.

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