By Donal Devlin
Two words – Apple Tax – encapsulate the utterly craven subservience of Ireland’s political establishment to big business. For eight years, successive governments have fought a legal battle against the European Commission in the European Court of Justice (ECJ) so that Apple Inc., one of the world’s largest and most profitable corporations, would not have to pay €13 billion in unpaid taxes to the Irish state. In September 2016, 93 TDs from Fianna Fáil, Fine Gael and Labour voted in favour of a motion supporting the decision to appeal the ECJ ruling.
On Tuesday, the state lost its legal battle against the European Commission, meaning €13 billion will be coming its way. The cost of this failed legal battle was not inconsiderable. In 2020, it was revealed that the state had paid €8.4 million in legal fees related to this case. Four legal professionals, including former Attorney General Paul Gallagher, had made €500,000 each, and a firm of solicitors received €3.2 million.
Tax haven Ireland
Much could have been done with the €13 billion in the last eight years, which have seen a housing crisis go from bad to worse, and public services remaining chronically underfunded – 230,000 children are currently facing deprivation. There is hardly anything to rent or buy, forcing many young people to emigrate; neurodiverse children are being disgracefully denied school places and the necessary resources in classes; and the health system remains in perennial crisis.
Concretely, the money from this tax haul could build 65,000 public homes on public land or a massively expanded and free public transport system across the country. However, the government parties remain unwilling to invest in quality public services or social and affordable homes. They are ideologically committed to the private market and the unfettered rule of profit, where big business is minimally taxed and sectors like housing are left to the private developers and landlords, making them unaffordable.
What reputation is damaged?
Media pundits and establishment politicians have already complained that this ruling will cause “reputational damage” to Ireland. The reputation in question is that of the Irish State being one of the global capitalist economy’s major tax havens. Predictably, they are pains to point out how this sector is crucial to the Irish economy. All the main parties, including Sinn Féin, are committed to this profit-driven, capitalist model of development. In fact, in the past number of years, the latter has met with the CEOs of multinationals to assure them that a Sinn Féin government will not in any way challenge their economic interests, i.e. being free to exploit workers and nature, both here and abroad, to rake in profits.
A low tax model for the super-rich and big business was never meant to work for the majority in society. It was designed to enrich multinationals in the hope of developing an indigenous capitalism in the southern State, but this remains extremely weak. This is why we have such a sharp contrast between the daily struggles faced by working class people as far as services are concerned and the existence of high profitable companies in the state. On top of this, Ireland has become a key hub for giant tech companies to store their data. Data centres owned by companies like Amazon now use 21% of the Irish State’s energy supply, and this figure is likely to rise to 32% by 2026. So on top of creating a vast chasm in wealth inequality, these companies are also assisting the destruction of our ecosystem.
Ireland’s status as a tax haven must end, meaning the plethora of accounting tricks that ensure we are robbed of billions each year in tax revenue are closed, and tax breaks for big business and the super-rich are ended. Corporate tax must be raised, and there should be investment to create a “gold standard” of public services in order to address the shameful underfunding in the care, education, and health sectors.
Capitalism exposed
Apple’s profits are built on a global chain of human exploitation, beginning in countries like the Democratic Republic of Congo, where it extracts – with the criminal use of child labour – vast sums of cobalt to be used in products. It is not alone on this score: Microsoft, Tesla and Google all garner super profits from the crudest exploitative practices, which are also destroying the ecosystems of many African countries.
The super-exploitation faced by workers that assemble Iphones and other Apple products by the Taiwanese owned firm, Foxconn are notorious. The brutal conditions of its workforce have tragically resulted in many of them taking their own lives in its main hub in the Henan provincial capital of Zhengzhou in China. As tensions have heightened between US and Chinese imperialism, Apple has began to diversify production to its factory in Chennai, in the Indian State of Tamil Nadu. There, 15,000 workers, 80% women (although married women are barred from working for the company), are forced to stay in overcrowded hostel accommodation, where from Monday to Saturday they are not allowed to leave, except to travel to Foxconn’s factory. Having workers live in accommodation that it dictatorially controls allows it to have a cheap “labour supply on tap”.
A rigged system
The Apple Tax scandal shows who capitalism is designed to work for. The tens of billions that are syphoned off via a web of accountancy tricks is nothing more than the unpaid labour of workers in the DRC, China, India, Ireland and the United States. This system, even in a period of considerable growth, is failing drastically to raise living standards and is built on massive inequality, combined with the destruction of our ecosystem at an alarming rate.
We need an economy based on democratic planning and public ownership that will use wealth and resources to invest where they are needed. The housing and multiple other crises we face demonstrate that we cannot rely on an economy run for profit to do this. It has utterly failed, and conditions will only worsen if it remains intact. This is particularly true if a global recession impacts Ireland. The necessity for a socialist alternative is more urgent than ever.
