Dublin (AFP) – Ireland’s fragile minority government agreed Friday to recommend an appeal against the EU’s tax ruling on Apple but said it was recalling parliament early for a special session to debate the issue.
The deal overcomes a split in cabinet over the 13 billion euros ($15 billion) plus interest that the EU says Apple owes in back taxes, putting Ireland at the centre of a row between Europe and the United States.
Apple chief Tim Cook has urged the government to appeal the ruling to secure future investments but opinion polls have shown public support for Ireland taking the money and spending it on social services.
A finance ministry spokesman told AFP there had been a “unanimous decision by the cabinet to appeal the decision” by the European Commission.
Parliament will meet next Wednesday, ahead of its scheduled return on September 27, officials said.
Earlier this week, three independent ministers propping up the government had refused to back the appeal and said they wanted greater transparency about corporate tax arrangements for multinationals.
But after the cabinet meeting, Shane Ross of the Independent Alliance said he and his colleague Finian McGrath had supported the government position.
“We felt there was a state of urgency because there was uncertainty out there in the markets amongst some multinationals,” he said.
“We were persuaded by the argument that it was necessary to clear up that uncertainty as soon as possible,” he said.
Katherine Zappone, another dissenting independent, confirmed she too had agreed to the appeal “in the public interest”.
The back taxes that the European Commission has determined the US tech giant owes are equivalent to around five percent of Ireland’s gross domestic product and almost all of its annual health budget.
– ‘Do the right thing’ –
“Ireland is caught in a dispute between the EU and US over which it has little control,” the UK-based Financial Times newspaper wrote in an editorial.
“Bowing to the commission’s ruling would… be a tacit acknowledgement that there has indeed been something rotten in the low-tax regime that Dublin operates to attract multinationals,” it said.
Ireland’s minority government relies on the support of the main opposition Fianna Fail party, which is likely to back the appeal in parliament.
Some lawmakers believe Ireland cannot afford to undermine its tax policies, one of the main planks of a highly successful inward investment strategy that has consistently attracted the world’s top tech and pharma multinationals over the past three decades.
Others say Ireland should take the money and spend it on services or build more affordable homes to deal with a housing crisis.
Ireland has two months to lodge an appeal against the ruling.
Fianna Fail technology spokesman James Lawless said earlier that Ireland had to appeal but admitted this would be difficult to explain to voters who wanted the money “gift-wrapped on their doorstep”.
“I would be more interested in preserving Ireland’s sovereign tax status,” he said, accusing the European Commission of interfering in Ireland’s tax affairs.
“Ireland has been caught in the crossfire between the United States and Europe,” he said.
On Thursday, Cook turned up the heat further stating his belief that the Irish government “would do the right thing”.
“It is important the government stands strong on that because future investment for business really depends on a level of certainty,” he said.
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