Ireland fights to restore investment reputation after Apple ruling

Wed Sep 7, 2016 3:46pm EDT
 
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By Padraic Halpin

DUBLIN (Reuters) - The European Union's demand that Ireland claw back billions in tax from Apple has hit the country's reputation as an investment destination just as it eyes up opportunities from Brexit, but officials say the damage will be limited.

Apple (AAPL.O: Quote) and the Irish government are both appealing against last week's European Commission ruling that the company's low tax bill in Ireland, where it is among the biggest multinational employers, constituted illegal state aid.

A campaign to redress the impact abroad has already begun and officials and multinational advisors say they are confident the order that Apple cough up 13 billion euros in back taxes will not interrupt record flows of investment into Ireland.

A string of controversies over corporate taxation had already prompted Ireland to begin phasing out the tax structure used by Apple.

"The Commission's decision has been reported around the world, it's a global story and some people obviously won't get past the headline. That's problematic for Ireland," said Martin Shanahan, chief executive of IDA Ireland, the state agency in charge of attracting foreign direct investment.

"When IDA tries to attract companies in, those companies work on the basis that the taxation system is what is laid down in law. The Commission decision calls into question whether that is the case and that's unhelpful, not just for Ireland."

Shanahan, who began the damage limitation with a series of media interviews in London within hours of the ruling, will use Brexit-related trade missions to London, New York and the U.S. west coast to provide clarity for investors in the coming weeks.

Ireland is hoping for a bonus from Britain's June vote to leave the EU, which leaves it as the only English-speaking country offering a base in the euro zone and a future in the bloc. It had more than 35 concrete enquiries by the end of last month from financial groups looking at setting up a base or expanding in Ireland as a result of the Brexit referendum.   Continued...

 
A 3D printed Apple logo is seen in front of a displayed Irish flag in this illustration taken September 2, 2016. REUTERS/Dado Ruvic/Illustration