Irish showdown with Brussels fizzles in Dublin corral

European Commissioner for Competition Margrethe Vestager | Emmanuel Dunand/AFP via Getty Images

Irish showdown with Brussels fizzles in Dublin corral

Margrethe Vestager appeared before an Irish parliamentary committee to defend her ruling on Apple’s tax bill.


1/31/17, 6:55 PM CET

Updated 5/13/18, 8:45 PM CET

DUBLIN — Furious over the Commission’s war on their country’s tax policies, Irish lawmakers dragged their Danish antagonist up from Brussels for a showdown and presumably a chewing out over the Apple case.

Once in their den Tuesday — after posing with supposed nemesis Commissioner Margrethe Vestager for photos, taken with iPhones — the EU’s antitrust czar barely broke a sweat.

Half of the 10 lawmakers who showed up walked out of the 90-minute hearing early. By its end, the remaining few were more absorbed in their smartphones and tablets than Vestager.

In between, Vestager said little that broke any new ground, and the Irish appeared to gain little from the whole affair.

There were no rabid questions or the fireworks more typical of a hearing in London or Brussels.  The occasional pointed question seemed aimed at political adversaries in the room rather than the commissioner.

And some left soon after they made their point.

At the core of Vestager’s appearance is Ireland’s corporate tax rate of 12.5 percent, the lowest in the bloc and a big draw for multinationals.

The country was livid when Vestager ruled that Apple’s special tax deal with Ireland gave the iPhone maker an unfair edge over competitors. The arrangement allegedly allowed European profits to be funneled through a subsidiary, which had no building, employees or function and paid virtually no tax in at least one year. The Irish government and Apple have appealed.

Tuesday’s cordial conversation belied that fury.

To allay the Emerald Isle’s concerns over the power of the European Union, Vestager stressed in the hearing that taxation is a sovereign right and only the Council can change common tax policies by unanimous vote.

“I don’t think [EU] will become a tax union … and maybe it’s good to have some competition on the tax things,” she said. “What I care about is companies actually pay the tax.”

To appease concerns of Pearse Doherty, a Sinn Féin member, that other European countries would grab chunks of the tax bill because the products were actually sold within their borders, Vestager assured the Joint Committee on Finance Public Expenditure and Reform that “the large, large, large majority of unpaid taxes would be due in Ireland,” and not to another country in European country.

After the hearing, committee Chairman John McGuinness said that Vestager “was clear in making her point, but obviously there is a disagreement between the Irish government and other political parties.”

“It is up to us now in Ireland just to show her and the Commission just exactly how the Irish taxation system arrived at its determination in terms of Apple.”

The money is supposed to be held in an escrow account, awaiting a final court verdict. Ireland missed the January 3 deadline to collect all of the funds, and the finance minister recently said the amount of money in the account would remain confidential.

“We are making no fuss about it because the case is progressing,” Vestager said.

Apple’s Chief Executive Tim Cook declined the committee’s invitation to appear. It referred to a statement from last year.

“It’s been clear since the start of this case there was a pre-determined outcome,” the statement said in part. “The Commission took unilateral action and retroactively changed the rules, disregarding decades of Irish tax law, U.S. tax law, as well as global consensus on tax policy, that everyone has relied on.”

At the end of the hearing, the lawmakers left in the room walked over to shake Vestager’s hand and thank her for attending.

She continued smiling and they all chatted amicably, exited the room together and posed for the official pictures — this time with a regular camera.

Noelle Knox contributed reporting.

Silvia Sciorilli Borrelli 

Leave a Reply

Your email address will not be published. Required fields are marked *