Ireland defends tax regime after US' “tax haven” claims

IRELAND IS PREPARING TO OFFICIALLY REJECT claims it is operating as a tax haven for large multinationals, after accusations made by US senators.

The country has been forced to defend its low corporate tax regime after a senate sub-committee found that while Apple has three Ireland-based subsidiaries, they do not appear to be tax-resident anywhere in the world.

Irish ministers insist their tax system is clear, and other countries are to blame for Apple’s ability to drive its effective rate down to 2%. Indeed, finance minister Michael Noonan pledged Ireland would not serve as the senate sub-committee’s “whipping boy”, Reuters reports.

Dublin intends to go on record this week, informing the committee led by chair Carl Levin it is not a tax haven and has not struck a special tax deal with Apple.

“Undoubtedly there’s a risk of reputational damage if we don’t defend our corner and set out the facts, so of course that’s happening,” Ireland’s European Affairs Minister Lucinda Creighton said, referring to the draft response.

“I’ve no doubt there will be a strong response, and we will strongly defend Ireland as a safe, a legally sound and a good place to do business. What you see is what you get, and that is why so many global companies are headquartered in Ireland.”

Creighton was speaking ahead of a four-day trip to Washington and New York, where she will meet business leaders and politicians. While the trip was planned before the current controversy, she said the opportunity would be taken to put right the “misinformation” heard in the senate.

Meanwhile, Google chief executive Eric Schmidt has admitted he is “perplexed” by the ongoing debate over its UK tax position, insisting the search engine pays what it is “legally required” to.

“If the British system changes the tax laws, then we will comply,” he told the BBC.