Apple tax costing poor countries more than we give in charity

Ireland’s role in helping some of the world’s richest corporations to avoid paying their fair share of tax globally sucks more money out of poor countries than we give them in charity.

That’s a small point missing from the debate over whether we should “take the money and run” after the European Commission’s decision to award us around €13bn in back taxes from Apple (plus interest).

Incredible as it may seem, that enormous sum is just the tip of the iceberg when it comes to tax avoidance that we facilitate.

Many of the richest corporations also route global profits through Ireland to avoid paying tax.

Countries like Britain and Australia are up in arms about this because it is a breach of the “social contract” that is supposed to underpin democracies.

The well-off – companies and individuals – should contribute taxes help the poor and keep the country running. That’s the theory anyway.

If one element of this contract breaks down – such as the richest corporations paying nearly zilch – others have to cough more than their fair share, or social services suffer. Next comes social unrest.

This is already happening with discontent manifested in Brexit and the election of Donald Trump.

People around the world are rightly angry that companies like Apple – the richest in the world - use all the roads, education, healthcare and policing services that their taxes pay for. Apple even get State supports for research and development.

But somehow they get away without coughing up their fair share of tax on a colossal global scale – because Ireland allows them to route profits through us and off to another tax haven.

It’s bad enough that we help Apple and its ilk to avoid paying tax in well-off countries. But doing it to poverty-stricken nations is a disgrace.

Nobel Prize-winning economist Joseph Stieglitz named and shamed us last week for helping to “rob” developing countries in this way.

And TD Katherine Zappone supported the Apple appeal only because “….the process would allow those countries who felt robbed or cheated by the past actions of Ireland and Apple to make their case and, hopefully, get the taxes which they lost out on.”

Oxfam has also fingered Ireland as one of the top ten tax-avoidance regimes in the world.

These help take “$100 billion out of the developing world every year through corporate tax avoidance,” the agency calculated in a recent report – much of this routed through Ireland.

"Taxes paid, or unpaid, by multinational companies in poor countries can be the difference between life and death, poverty or opportunity. $100 billion is four times what 47 developing countries combined spend on educating their 932m citizens,” Oxfam warned.

It could also provide water and sanitation for 2.2 billion people – almost everyone in dire need.

Christian Aid estimated that the developing world loses "almost twice the annual global aid budget” through corporate tax avoidance of the type facilitated by Ireland - "enough to save the lives of 350,000 children under the age of five every year.”

Meanwhile our Government gives over €600m in foreign aid every year – and we donate €840m more to charities.

But what is the point of this when we’re facilitating tax avoidance in developing countries on a much, much bigger scale.

“We are giving with one hand and taking with two,” said Owen Wright of Trocaire.

Christian AId confirmed that Ireland’s role in facilitating tax avoidance – costing developing nations a trillion euros every decade - far outweighs what we contribute through charity.

African leaders, and former UN Secretary General Kofi Annan, have highlighted that the continent loses more money each year to tax dodging than it receives in international development assistance.

The Oxfam report said: “90 percent of the top global companies use tax havens. The same tricks and tools…cheat countries across the world out of their fair share of tax revenues, with devastating consequences.”

So maybe we should claim the tax owed by Apple – if only to redistribute it to the poor countries we helped take it from in the first place?