Ireland Debates Collecting Unpaid Taxes From Apple

ARI SHAPIRO, HOST:

Today in Dublin, the Irish parliament began debating a question that could redefine Ireland's role in the world. The country has a chance to grab an incredible sum of money - more than $14 billion in unpaid taxes from Apple. That's because a European court ruled that Apple was guilty of tax evasion.

Now, here's the catch. Ireland has built its reputation as a tax haven that welcomes global business, and many politicians fear that if Ireland takes this money, it could scare away the giant corporations that hold up Ireland's modern economy. Columnist Fintan O'Toole wrote about this dilemma in a piece for The Irish Times, and he joins us now. Welcome.

FINTAN O'TOOLE: Thanks, Ari.

SHAPIRO: So this tax bill is more than $14 billion. When you include interest, it could be more than $20 billion. So on the one hand, there is this incredible tempting pot of money that could be used to address child poverty or crumbling infrastructure, and on the other hand, you quote one Irish politician who says taking this money would be like eating the seed potatoes. Explain that argument.

O'TOOLE: Yeah, so the argument from the government and from really a lot of the establishment in Ireland would be, look; Ireland became a modern globalized economy by welcoming in all of these multinational corporations, most of them of U.S. origin. If we take the Apple money, what we're basically going to do is scare those companies away because they're going to feel that the European Union is moving in on Ireland's very low corporate-tax rates.

It seems to me that it's actually rather a bad argument because a lot of these corporations have been paying less than 2 or 3 percent tax on massive global earnings even though the Irish corporate-tax rate is supposed to be 12-and-a-half percent. And really it seems to me Ireland's interest at the moment because public opinion is shifting so much around the globe is to say - come out with your hands up, say, we're sorry; we didn't intend it to get as bad as this. We have changed because in fact Ireland has actually closed off the loopholes that Apple was using.

SHAPIRO: But it seems to me that we're in an era where things have really changed. It used to be, you're a company that creates a widget, and you pay taxes in the country where you create the widget. And now all of these global companies seem to be in a race for the bottom to find the lowest tax rate anywhere in the world. If Ireland stops competing for that title, won't they all go someplace else, and Ireland's economy will have to go through a massive shift?

O'TOOLE: I think this era of corporations being nowhere just has to come to an end because its consequences are really very serious for democracy, for equality. And I don't think it's going to last. And I think Ireland maybe could get a lead by saying, look; we got caught up in all of this. It's over. We want to be seen differently now.

But also we want the rest of the world not to be hypocritical about this and to recognize this isn't just an Irish problem. And it's something we really need international agreements on how these corporations are going to be fairly taxed and pay their fair share.

SHAPIRO: Why do you think this global shift against tax havens is happening right now? The tax havens have existed for some time.

O'TOOLE: I think the why now is because every one of us is seeing in our democracies that those democracies are coming under enormous pressure. The United States is having a presidential election that nobody could've imagined two years ago. The European Union is in enormous turmoil. You've got Brexit happening. And a big part of this is driven by inequality. It's driven by people's sense that there's something wrong with the basic ideas of fairness that hold a society together.

And this is not all down to corporate tax avoidance, but corporate tax avoidance is a very large and very visible part of this. I mean when people hear about a corporation like Apple, which they know is the most profitable corporation in the world, was paying in its Irish company 0.005 percent tax, it makes people angry. And that seems to me to be the big picture here - that whatever the details of the Apple case in Ireland, this is probably a harbinger of things to come.

SHAPIRO: Fintan O'Toole is a columnist for The Irish Times joining us from Dublin. Thank you very much.

O'TOOLE: You're very welcome, good to talk to you.

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