Ireland, Scotland’s Celtic cousin across the sea, is regularly cited as a potential independence model to follow. But the Irish government’s disgraceful decision to give Apple illegal preferential tax treatment serves as a reminder why the neo-liberal Celtic Tiger model is so dangerous. Calum Martin, National Co-Chair of the Scottish Socialist Party, says there are lessons we can learn…
Storm Hector had just finished passing on Thursday morning when the news broke that the Irish Government had been helping Apple, the richest company in the world, dodge nearly €21 billion in tax across the EU between 2015 and 2017. The most disappointing aspect of all of this? It wasn’t much of a surprise.
Ireland’s governments have long marketed the country as a corporation-wooing, tax-free, low-regulation haven within the EU market. They have promised a tax system that is hardwired to benefit the richest corporations in the world. The Irish government’s rate of corporation tax, when they are actually compelled to collect it, is barely a third of that in Germany, France and the USA. Back in 2016, when the EU regulators first picked up on what was happening, Apple were ordered to pay €13 billion in owed taxes to the Irish state. Bizarrely, the government took the regulators to court in a bid to refuse the money.
Why? They reasoned that forcing Apple to pay might worry other corporations they’ve been harbouring near tax-free for decades. Traditionally, it’s the sort of information you’d try to hide from regulators – not the basis of your opening argument in a court case against them. Franz Kafka, eat your heart out! But there’s no way to excuse this behaviour – it’s fundamentally bad business for everyone. Except Apple.
From their perspective, they’ve made a fortune. The €21 billion they’ve protected is an enormous profit for their top executives to luxuriate in. For the Irish population, it’s more than a figure – it’s money stolen that was meant for housing, schools, hospitals or roads.
This is about more than Apple and more than just a tax dodge. They’re just the company in the spotlight, one of a whole host that fiddle their books and put pressure on governments in the same manner. The total sum snatched from potential public use across Europe is astronomically higher than tens of billions. Apple, and companies like them, are already paying poverty wages, hammering away at millions of people’s living conditions and undermining our domestic markets.
The billions they siphon out of communities with these tax-dodging hi-jinks only adds insult to injury. And for what purpose? Richard Branson holds more than $5.1 billion. Mike Ashley holds more than $3.8 billion. The list goes on – these profiteering billionaires sit atop mountains of hoarded wealth yet will will never consider it enough. We lose and lose and lose so they may take and take and take.
As Brexit and independence fuels renewed debates around economic models, there’s an important lesson to be learned here. The Irish government for years argued that the measures they were undertaking would benefit the people of Ireland. The theory went that the corporations could be lured into Ireland, a potential tax haven within the European single market, and the wealth derived would trickle down to the populace when profits went up. This has never been the case and never will be.
According to the think tank Social Justice Ireland, as of December 2017 there are over 790,000 people trapped in poverty in the country. A further 16.5% of the population are at risk of being dragged into this same trap. Many people in both categories are in work. The authors of the report warn that the low-pay epidemic in the country has reached such heights that without social security support for those in work, poverty figures would rise to 44.9%.
Given this context, the fact the Irish government (leaders pictured below) chose to go to court to refuse an immense sum of money is sickening. This is the context in which countless politicians are still arguing taxes for the corporations responsible must be cut while workers’ rights and wage protections should be eroded. The so called Celtic Tiger has mauled the very people it was designed to allegedly benefit. What we see now is the continued dogmatic pursuit of an outdated economic model that fails to deliver for the people. As ever, it’s about economic priorities – do people come first or do corporations?
Tax-dodging. Poverty pay. Rip-off utility prices. These are universal problems we face and that includes us here in Scotland. But there are ways and means of fighting back and putting pressure on these corporate groups and the super rich. There are numerous reports and campaigns demonstrating how we can work together to close tax loopholes, replace broken legislation and replace “the race to the bottom” with a more co-operative approach.
The government’s own figures attest that a £10-an-hour minimum Living Wage is needed to be truly secure in getting by. To win such a necessary measure would lift millions out of poverty and make life better, happier and more secure for millions more. Moreover, it would majorly boost our economy, particularly small and local businesses and community enterprises as people’s spending power as customer would increase.
This isn’t just a reversion to Keynesian dogma – it would genuinely save lives. By restoring overpriced essential utilities like gas, electricity and the railways back into public hands and reduce another needless drain people’s incomes. Why should working people be held to ransom to feather the nests of rich executives? Why should the retail worker in Edinburgh or the clerical worker in Glasgow be threatened with needing payday loans just so bosses can stow another million in a tax haven?
From a Scottish perspective, we need to acknowledge that we won’t win these changes by sitting back and waiting for Westminster’s parliament, an institution intrinsically geared to suppress radical change, to deliver. The Tories and Labour may be two different waiters with different priorities, but all the food is provided by the same high finance kitchen. We must stand up not only to corporate greed but to the politician who aid and facilitate it, which requires campaigning for economic change now – not later.
It’s also why the only meaningful vision for independence is one which enshrines the transformative potential it holds. It must be used to shift the balance of power in Scotland away from wealthy vested interests and back into the hands of the people. It removes the obstacle so frequently posed by the Westminster political class, a bastion long marinated in the influence of wealthy elites.
For Scotland to take a step forward and for independence to be a triumph of democracy and egalitarianism, we must recognise that neither the Celtic Tiger nor the British Bulldog offer healthy, sensible models for the future. The latest news from Ireland serves as a reminder that our parliaments have become clogged up with politicians who can’t and won’t stand up for us – it’s time to do it ourselves and ensure we live in a future where no one is dependent on the whims or caprices of Apple, Branson, Ashley and co. Rejecting this system shouldn’t be seen as outlandish – it’s common-sense democratic socialism.
