Actually that's a TV commercial that was used around the world in 2009 for IDA Ireland. I was on the team that did it and were terribly proud of it then. Now, I'm not, in what's developing as being more clear that Irish investment policy is a sham and simply facilitating widespread tax evasion.
Ireland, it is becoming clear, is at the centre of facilitating widespread European tax avoidance along with countries like Luxembourg and Bermuda. Our investment policy in attracting high-profile US dot coms, is nothing to do with innovation or a "great workforce" that draws US multinationals here - it's because of our tax breaks, pure and simple. It allows them to divert other european revenue to Ireland, declare it here and pay low tax. Rather than declare it where it's generated and pay it there.
The premise that big multinationals invest in Ireland because of something other than tax, is a lie. You can see previous blogs on this issue here;
- On Starbucks UK http://streamabout.blogspot.ie/2012/12/starbucks-are-we-seeing-death-of-brand.html
- On last weeks Dropbox announcement to base in Dublin http://streamabout.blogspot.ie/2012/12/now-dropbox-comes-to-dublin-for-greatly.html
- And general tax avoidance http://streamabout.blogspot.ie/2012/12/starbucks-amazon-google-microsoft-wpp.html
Starbucks, following a series of protests against them in the UK Saturday, by 'UKUncut' after the dreadful revelations regarding their low, low, UK tax, have made efforts to settle. However, the whole tax avoidance story against Facebook, Amazon, Starbucks and others emerging, threw Ireland into the headlights. It's their stories that's unravelling ours.
Vodafone now are starting to get a mention and they too have a major Irish presence.
Starbucks attempted settlement with UK Revenue by offering to pay 10 million a year tax, for two years. Big deal. Their chief executive, gets 16 million a year alone. Their brand is damaged for ever and they'll not recover from it.
Being mentioned too, by the US Government as Europe's "biggest tax haven" and, mentioned in the same breath as countries like Belize and The Cayman Islands, Is good old Ireland. Ireland's investment policy, it's becoming obvious, seems to be driven by helping major companies avoid tax elsewhere. In fact, 50% of Irish government income revenue tax comes from US Multinationals. Clearly, they don't generate that tax and revenue in Ireland.
At a meeting I attended with US Secretary of State Hillary Clinton last Thursday, she talked about US companies investment in Ireland. At nearly 2 billion usd, it's more than US companies invest in India, Brazil, China, and Russia....COMBINED. Now we know why.
The reason? Nice climate? Nah. Great workforce? nope. Super tax incentives? Absolutely. And for most, call that, tax avoidance.
And this is an Irish Government, knowingly complicit in widespread tax avoidance, that persecutes its own citizens to pay their tax.
And a new brand to take over the Irish story as a tax avoider (taking the mantle from Starbucks), is our good friends, Microsoft.
Microsoft is channelling Windows 8 online sales to Luxembourg in order to avoid tax in the UK of over 2 billion euro. According to The Sunday Times, Microsoft keeps a small office in a Luxembourg business park with 6 staff that handles millions of pounds in European online sales.
The bulk of that money is then transferred elsewhere. Any ideas? Yep to its European headquarters in Dublin, Ireland. Profits are then routed to Bermuda without UK corporation tax being paid.
Bermuda? Luxembourg? Dublin? And this is Microsoft. Dear oh dear. Ireland's role in this is truly appalling.
Luxembourg is a long practitioner of these black arts and is now the highest GDP per head of the population in the world, largely because of these sham transactions. Its tax rate of 21% can be reduced through negotiation and other royalty taxes can be as low as 6% to even 1%.
(Indeed, it's right bang in the middle of the new, and coming to a screen near you, JP Morgan tax avoidance scheme - 200 million? JP Morgan? THE brand of trust??? Jesus).
One of the most profitable companies in Luxembourg is Amazon who has their European headquarters there. European Headquarters in Luxembourg??? ...jeez. Amazon therefore avoids UK tax on about 2.9 billion sterling of revenue generated by British consumers.
Apple is at it too. Its sales of UK Itunes goes straight to its HQ in Luxembourg. With a turnover of 836 million sterling, it employs 16 staff. For a company turning over near a billion, 16 people. A sham!!!
Microsoft's online store in the UK references the fact that if you buy online you are in fact dealing with Microsoft Luxembourg and ultimately, as we all know now, Ireland.
One Microsoft Ireland company accounts reveal it receives about 1.7 billion sterling in UK revenue and no corporation tax is paid on any of that money. Another Microsoft Ireland company - Microsoft Ireland research - reported 4.3 billion usd in profits for licensing rights in 2011 (so clearly not generated in Ireland) which presumably paid the super Irish tax avoidance rate of 12.5% or lower.
Profits from this Irish company are paid to another Irish company - Round Island One - which pays its dividends to Round Island Holdings based in....Bermuda. Shocking.
I am Irish.
A country that has put its citizens into poverty in order to pretend that it was "honourable" and honouring promises to bank investors (bondholders). One wonders was pressure put on by these multinationals?
When in fact it was at the same time dishonouring its European partners by facilitating enormous tax avoidance. IDA need to explain it all now.
This needs disclosure because if we don't that, our European partners will demand it. We should act before they start to crucify us over this.
And they will.
We're looking like the con merchants of Europe.