Ireland’s corporate tax system has been subjected to unfair criticism over its controversial arrangement with tech giant Apple, the Taoiseach has said.
Attending the World Economic Forum in Davos, Switzerland, Leo Varadkar insisted Ireland was a global leader when it came to tax transparency.
In 2016, the European Commission ruled that Apple had not paid enough tax on its corporate profits in Ireland – deeming the complex arrangement in breach of EU state aid rules.
It subsequently ordered the government to claw back around 13 billion euro from the iPhone maker.
The ruling has been disputed by the Irish government and Apple, and both are challenging it in the courts.
Mr Varadkar has defended his government’s tax arrangements with Apple (Niall Carson/PA)
Ireland will collect the money prior to those legal challenges, but it will not be spent until a final outcome has been reached.
Confirming that the process of securing the money from Apple would begin in the coming months, the Taoiseach said Ireland had been on the end of “unfair press” over the furore.
“The allegation is that Ireland had some sort of special deal with Apple and we didn’t – and we believe we can prove that in the courts,” he said.
Mr Varadkar said the case had not made a favourable impact on Ireland’s international reputation.
“It certainly hasn’t been helpful,” he told Bloomberg TV.
“Ireland is a country with a very clear tax policy, we have had it for a very long time now, our corporate tax is 12.5% – it’s not going up, it’s not going down – and unlike a lot of other countries there are very few get-out clauses and exceptions and credits.
“Other countries have a higher tax rate on paper but actually they collect less and the OECD figures prove that, so it certainly hasn’t been helpful.
“Ireland has got some bad press as a result of it but I don’t think that’s fair.
“We are really one of the most transparent countries when it comes to tax, the fact we have a rate that is low, simple and transparent.”
The Taoiseach said bad press Ireland received was ‘unfair’ (Brian Lawless/PA)
Mr Varadkar has been forced to defend Ireland’s tax regime from critics elsewhere in Europe.
His visit to Davos came amid a push for greater tax harmonisation across the bloc. Mr Varadkar has opposed the concept and insists Ireland will retain tax sovereignty.
The Taoiseach also said he was confident moves by the Trump administration to cut taxes and prioritise US-based companies would not have a significant impact on foreign direct investment in Ireland.
He highlighted that Ireland had many more benefits for investors aside from tax rates – including single market and Euro zone membership, and the fact it was an English-speaking county with a strong talent pool and respected education system.