We’re all in EU together, or are we?

Google (parent company Alphabet) and Facebook are representative of a number of multinationals based in Ireland. We just love them because they employ lots of people who all pay their taxes and PRSI. Unfortunately they tend to crowd around Dublin which puts a lot of pressure on city infrastructure and because they can afford to pay good wages (you’ll see how they do later), Dublin rents and house prices get nudged steadily upwards making it difficut for those not employed by well paying multinationals to find a reasonably priced place to rent or buy.
Since Ireland joined the EU it has benefitted by being a member, but how good a member are we of this club at the moment?  Back to Google and Facebook: it is probably a fair estimate to say that the business these companies do in the countries in the EU is propotionate to that country’s  population. This is where things get tricky; the invoicing for virtually all the revenue earning activity of these two companies, and many other multinationals, are booked through mainly Ireland or Luxembourg.  
We all know why they do this. An estimate has been done whereby their total EU revenue is broken down by country in proportion to population and the corporation tax of each country applied to their extimated profits. Okay, a lot of estimating but for the purposes of this article it’s good enough. If these two companies alone for the last two years for which we have accounts had paid tax in this manner our neighbours in the EU would have collected between €5.0 and €5.4 Bill additional taxes.
Looking at an even bigger picture, the proportion of revenue paid as taxes by Google outside the EU is between 6% / 9%. Within the EU it’s 0.36% / 0.86%! In the case of Facebook, outside EU, 28/34%, within the EU 0.03% / 0.1% !!
One would imagine that Ireland should be well rewarded by these firms by way of paying some decent taxes for enabling them to perform such financial gymnastics. You gotta be joking! For example, in one year in which Facebook Ireland Ltd generated a profit of €1.75 Bill, even a miserly 5% tax would have chipped almost 9 Mil to help run the country, but oh no, by the time this FB company paid more than €1.75 Bill in “administrative expenses” tied to the use of Intellectual Property to its other Irish registered subsidiary, Facebook Holdings Ltd, the Profit became a Loss of €626,000.{F.Times article}
Meanwhile the Government provides educational facilities, primary secondary and third level to prepare citizens to be highly employable by these multinationals. In addition infrastructure is put in place, roads with flyovers and flyunders, LUAS, hospitals, fire stations, broadband etc to an able them all to operate effectively in Ireland. Does the Tax & PRSI come close to covering a decent proportion of these costs? Not on your life
So here we are now, after having got a good leg-up since becoming a member of the EEC club many years ago, providing facilities for some of the richest corporations in the world to avoid paying their fair share of taxes in the countries in which they earn their profits. As I often say, “just ‘cos its legal doesn’t mean its fair”.
What can we do! Well publish in any and every way you can the unfairness of these sneaky arrangements and by conveying our view to the local TDs and Ministers they may just come to agree that Multinational Corps have a responsibility to pay their fair share of taxes in the communities in which they make their profits. “Taxes are the price we (individuals & corporations) pay to live in a civilised society”.

About tryingtobefair

More than a little interested in how we can all make the community we live in a better place. "The world has enough for everyone's need, but not enough for everyone's greed" Gandhi. Let's all learn what's enough.
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