Ireland’s tax policies have come in for stinging criticism at the hands of Nobel-prize winning economist Joseph Stiglitz.
Speaking at a press conference in Paris yesterday, the University of Columbia professor accused Ireland of being a bad neighbour when it comes to the country’s favourable tax rates for multinational companies.
His comments come as the court case surrounding Apple’s tax affairs in Ireland rumbles on in Europe.
“In the area of taxes, Ireland has not behaved well, either globally or for their own citizens, or as an EU citizen,” Prof Stiglitz said.
“It is not a good citizen to try to rob your neighbour. And what Ireland did is it tried to get revenue that would have gone to other European countries to be relocated into Ireland, to take a pittance out of that [in tax] and to do a deal where Apple is perfectly happy because they get their taxes reduced.
“And who pays? The rest of Europe is paying. You don’t do that to your neighbours, to your partners in the EU. I view Ireland not only as a tax haven; it is not a good citizen of the EU.”
Prof Stiglitz said he was “a little shocked” when Ireland opted to fight the European Commission’s decision that Apple should pay €13bn in taxes.
“The country needed the money. The view that that would hurt Ireland’s reputation was totally wrong. Unless Ireland wanted to have a reputation as a confirmed tax haven. But if it wanted to say we’re going to play by European rules and we are going to be a normal economy, it actually made no sense to turn down that money.”
He said that the argument that Ireland’s position as a hub for multinationals would suffer if the tax was paid is “bogus”, adding that “industry gets located where there are well-educated people, good infrastructure . . . countries like Japan and Korea attracted industries, educated their citizens and there’s no reason why Ireland couldn’t do the same.”
In 2016, the European Commission said that Apple must pay €13bn in back taxes to Ireland but both Apple and the Irish Government are challenging this.
The European Commission has claimed that Ireland gave Apple an unfair advantage through a favourable tax arrangement, though lawyers for the Irish Government have argued that the commission had failed to show that Apple had received any advantage.
It is expected the court will rule on the Apple case in the coming months but if the losing party appeals the decision to the EU Court of Justice, a final judgement could take several years.