The tax crusade begins and Ireland is the victim

The Republic of Ireland is a nation that I know and love. My mother was born there, my father’s family come from there and I am a citizen of the emerald isle. I often visit; for birthdays, weddings and funerals generally. Over my many years of visiting, I have come to know and appreciate the country’s main struggles and strifes.

I think there is a misconception that Ireland is a slightly more rural looking version of the UK. We speak the same language, and it is so geographically close, you could be forgiven for thinking that these days there is little difference between the two. But again, these days it is easy to forget that the northern counties of Ireland, and Northern Ireland itself, were a war zone not so long ago.

Then of course, beyond the many massive cultural differences, the thing that probably sets Eire and the UK apart, is economics. The Republic of Ireland, despite years of EU investment in infrastructure, is a poor country in comparison to the UK.

Perhaps that slightly rambling introduction might leave you wondering what this article really has to do with anything. Well, Ireland’s fight to rebuild and inject some life back into the Celtic Tiger was sent back to square one this week, thanks to a body that has often been the first to come to Ireland’s aid.

The European Commission has ruled that Ireland must claim €13 billion in tax back from Apple. Across Europe, many see this as a victory against multinational companies abusing tax policy in order to maximise profits. But strangely, despite a possible €13 tax windfall, the Irish government will not be popping the champagne corks anytime soon. In short, this is a disaster for the Republic.

In recent years, Ireland has hit tough economic times, and as a country they have been hit hard by job losses and a lack of business. To combat this, the Irish Government have made a concerned effort to reduce tax levied on large companies in order to encourage large firms to set up shop there. They didn’t just set up shop; Apple, Intel and Google have all based their European headquarters in Ireland. This has brought a much needed economic boost and the results were almost starting to show. Foreign investment was the main factor in a massive 26% jump in Irish economic growth last year.

Yet suddenly this week, all of this has come undone. The European Commission has taken issue with Apple’s Irish tax affairs, and it is clear that they will not stop there. As they slowly take apart Ireland’s attempts to attract foreign investments, the EC could single handedly be responsible for the flight of the multinationals that have been slowly bringing Ireland back to life.

In the past few years, we’ve seen a European migrant crisis, European security disasters and Brexit. Now add to that list an effort to send an EU country backwards in its attempts to boost its own economy and it does make you wonder; maybe the Brexiteers were on to something after all?