They claimed the European Commission was “bullying” Ireland in the same way it did during the bailout, as the Cabinet’s “unanimous” decision to appeal was undermined after two ministers said they still believe multinationals are not paying enough to the State.
After 72 hours of crisis talks and two Cabinet meetings, Government agreed to appeal Tuesday’s European ruling that technology giant Apple owes this country €13bn in taxes.
In addition to the decision and on the insistence of the Independent Alliance and unaligned minister Katherine Zappone, Cabinet also agreed to seek Dáil approval on the matter; set up a review of other multinationals’ tax bills; and to discuss plans to make our tax system more transparent.
The deal is almost certain to be signed off after the Dáil is recalled to vote on Wednesday. However, after the agreement was announced, Mr Kenny and Mr Noonan launched a dramatic attack on Europe, saying Brussels is attempting to use the controversy as a “bridgehead” to force Ireland to increase its 12.5% corporation tax.
“I do, I think they are establishing a bridgehead,” Mr Noonan said when asked at Government Buildings if the European Commission was using the Apple tax controversy as a “proxy attack” on the 12.5% rate.
“There is a lot of envy across Europe,” said Mr Noonan. “You will recall the Taoiseach’s first meeting in Europe in 2011, there was an attempt to bully him by [French] president [Nicholas] Sarkozy to drive the corporation tax rate up to 15% as a quid pro quo for the bailout.”
Referencing European competition commissioner Margrethe Vestager, who has been to the forefront of Europe’s Apple probe, he said: “There will be no change in Ireland’s 12.5% rate. It is in our competence to fix the rates and no bridgehead by any commissioner is going to change that.”
His decision to increase tension between Ireland and the European Commission was backed up by Mr Kenny, who repeated the claim that Ireland is being bullied.
Speaking on RTÉ’s Six One, he said he would make “no apology whatsoever” for challenging the ruling, as the move is “about us as a sovereign nation”.
“This [the Apple tax situation] is about the right of a small nation,” he said.
“I’m not sure whether the European Commission want to ingratiate themselves with more powerful countries than ours, but this is a small country.”
The comments were made after a second Cabinet meeting in 72 hours over the crisis ended after 35 minutes with “unanimous” agreement the ruling must be appealed.
However, Independent Alliance TD John Halligan said he “personally” still believed “multinationals probably don’t pay a reasonable amount of tax”.
Describing the situation between Apple and Revenue as “unethical”, Children’s Minister Ms Zappone similarly said the European Commission was acting “in the public interest”, adding that “countries who feel robbed or cheated can use this appeal to make their case”.
Independent Alliance TD and Disabilities Minister Finian McGrath defended the Cabinet deal, saying: “When you’re in power you have to make compromises.”
Opposition parties accused the Government of contradicting its own position.
A long-standing Fine Gael TD has reignited the debate over when Taoiseach Enda Kenny should leave office by insisting the issue needs to be discussed as early as next week.
Fergus O’Dowd told RTÉ Raidió na Gaeltachta “everything should be discussed” when Fine Gael holds its next parliamentary party meeting, which could take place next week.
Asked about the short-lived summer debate over Mr Kenny’s departure date, the Louth TD said: “That’s Enda’s decision.”
However, he added he will “absolutely” raise the matter at the next party meeting.