John Paczkowski

Recent Posts by John Paczkowski

Ireland Denies Giving Apple Any Special Tax Deal

fighting-irishIreland has a special message for U.S. senators convinced that the country gave Apple a special tax deal: You don’t know what you’re talking about.

Remarking on a U.S. Senate investigation that claims Apple avoided taxes on tens of billions of dollars by holding significant profits in three Irish subsidiaries, Ireland’s Finance Minister Michael Noonan said the country did not work out a special corporate tax rate of only 2 percent with Apple. “I do not want to be the whipping boy for some misunderstanding in a hearing in the U.S. Congress,” Noonan said during a parliamentary committee meeting on Wednesday.

In other words, if Apple was able to markedly reduce its tax bill in the U.S. and the rest of the world, it was because of a gap between different tax jurisdictions, not some magic deal with Ireland.

“Maybe there was a magician, but the magician wasn’t living down in Cork,” Noonan quipped. “Because [Apple] is not tax resident in Ireland, [it is] not liable to Irish tax.”

Noonan’s comments echo those made earlier in the day by Barry O’Leary, head of IDA Ireland, the agency responsible for industrial development in Ireland, and the one that would presumably have presided over Apple’s special tax avoidance deal — if there were one.

“It is very, very important to state that there is no special deal for Apple or any other company,” O’Leary told RTÉ radio. “I’m certainly in a position to say that nothing like that has been agreed by the Irish government. That’s definitely not the case. Just because you heard it yesterday in a Senate committee doesn’t mean … it’s factually correct.”

Indeed. There’s no special deal here, just some clever and totally legal tax planning on Apple’s part. Whose fault is that?

As I noted here earlier this week, “Maybe the Senate’s time is better spent overhauling the U.S. tax policy that has allowed Apple and other companies to legally minimize their tax liability in the first place. If what Apple was called before the Senate for doing isn’t illegal, isn’t the big policy question today simply whether it should be allowed to do it in the future?”

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