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Reclaim our Economic and Political Sovereignty

Read also Michael Roberts Blog

https://thenextrecession.wordpress.com/2016/11/09/donald-trump-and-the-poisoned-chalice-of-the-us-economy/

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Students Should Pay New Stealth Tax -Fine Gael

Irish students could be required to pay full fees funded by bank loans repayable when in employment

Double Taxation for Education?

A study by Prof Bruce Chapman, the architect of an income-contingent loan system in Australia, and Maynooth University academic Dr Aedín Doris finds that an income-contingent loan scheme is the cheapest way for the State to fund a major expansion of third-level education.-Iris Times

Te truth is that under the EU Fiscal Treaty  the Dublin Government cannot borrow to expand third level education. Neither can it use the proceeds of sale of state assets such as AIB and Permanent TSB (See Taoiseach Statement Below). FF-FG-Lab-Greens refuse to tax the huge recent asset gains of the Irish Super-Rich. Their only answer is to make the population pay through various stealth taxes-student Fees, increased price of stamp, home taxes etc The other stratagem is to get public utilities to borrow off state books.  The interest and capital must then be repaid by the user of the service through the inflated price of the service. That is where  absence of economic sovereignty leads .

Double Taxation

Increased student fees, like water charges, are a form of double taxation. Money for expansion and resources for third level education is already  being provided through general taxation. But Government agreed to borrow money to bail out big financial investors in Irish banks. Seperately with the support of all the main political parties the FF-PD government had transferred a big tranche of income taxation onto house buyers and wished to go even further! (“Ms Harney endorsed the ambitious targets recently set by Attorney General and former PD TD, Mr Michael McDowell, to bring the standard rate of tax to 16 per cent and the top rate to 33 per cent over a five years.” Irish Times Oct 10, 2000) When property sales collapsed Government was forced to increase borrowing  to maintain even drastically reduced public services.

Some of the tax revenues being gathered for health, education, welfare, water provision etc was then diverted to pay interest on the new borrowing-now 4 billion above pre-crash levels.

Recent governments then sought to replace the diverted revenue through stealth taxes- full fees for students being just the latest. And there will be more!!!!

According to the Sunday Independent Rich List, published recently , the total assets of the richest 12 Irish Citizens increased by 6 billion Euro in the past year. The financial assets(shares, bank deposits) of the top 10% of Irish Families are now 35 billion Euro above PEAK BOOM LEVEL (CSO-Institutional Sector Accounts). These have been the main beneficiaries of the austerity policies of successive governments. But FG-FF-Lab-Greens are determined that there should be no tax on these windfall gains. Read   SUPER_RICH IRISH AWASH WITH MONEY on this blog   http://wp.me/pKzXa-n4

Paddy Healy   086-4183732

Full Irish Times Article  02/05/2017

http://www.irishtimes.com/news/education/graduates-could-pay-160-a-month-until-aged-33-under-loan-plan-1.3068002?mode=print&ot=example.AjaxPageLayout.ot

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Taoiseach Indicates that Government is to Introduce New Stealth Taxes to Fund State Capital Investment as Proceeds of Sale of Banks and other State Assets Cannot be Used To Fund Investment in Housing, Health, Water Services and other Infrastructure due to EU Fiscal Treaty and EU Stability and Growth Pact

Taoiseach:   (As a result of sale of 25% of Allied Irish Bank)     There is, therefore, no increased capacity to spend. The proceeds from any IPO(share sale) would be used to pay down debt. As I pointed out to the Deputy earlier, it is possible to spend substantial moneys off balance sheet provided an income stream can be identified from, for example, investment from the European Investment Bank.

–The European Investment Bank is here in Dublin. It is open for business and one of those businesses is to identify streams of income that would have a capacity to repay long-term loans such as, for example, tolled motorways, the development of ports, or provision where there are streams of income from the Luas, metro or light-rail systems. That matter is being actively explored by the Department of Finance with the European Investment Bank.

Dáil Proceedings  21/03/2017

Deputy Brendan Howlin:   —

The Government is pressing ahead with its plans to sell off 25% of AIB. This has been planned despite the fact the proceeds cannot be invested in Irish infrastructure that is so needed. All of us in the House and the people of the country are acutely aware of what it cost the Irish taxpayers and people to bail out our banks. It was always understood and expected we would get back a significant portion of it. We need now to think and plan strategically when it comes to deploying funds which might become available to the State.

For many months I have been making the case for changes to the Stability and Growth Pact to allow for greater investment in public infrastructure. I have been advancing this work with my colleagues in the Party of European Socialists and that work is now being adopted by them. I have also repeatedly raised the matter in the Chamber hoping the Taoiseach would do likewise. Unfortunately, he has not provided a response to date that would indicate he would also push for a shift at European level on this matter. The result is that right now none of the proceeds of the sale of AIB can be invested in building the houses, hospitals and schools which we so urgently need. The policy of selling off our holding in AIB was based on the urgent need to reduce our debt but that situation has dramatically changed since the previous Government made that decision. Net debt had already decreased to 66% of GDP prior to the most recent CSO published data, and it will fall further.

Diverting everything we get from the sale of AIB would have an impact of approximately 1.5% on debt, a small impact. The social good it would yield if we deployed it to meet our infrastructure deficits would be infinitely greater. IBEC and the Irish Congress of Trade Unions have pressed for greater investment. The social case for housing and hospitals, as I have already said, is crystal clear, and the economic case for investment in transport and communications is equally so, amplified by having Brexit on the horizon. Will the Taoiseach clarify what efforts he has made to secure changes in the Stability and Growth Pact rules to allow us make the urgent investment we now need in our vital infrastructure, particularly having regard to Brexit?

Deputy Brendan Howlin:  ] Will the Taoiseach clarify whether he intends to press ahead with the sale even if the proceeds of the sale cannot be used for infrastructural investment?

The Taoiseach:   I thank the Deputy for his comments on the rescue of Rescue 116 and those who lost their lives.

With regard to the other issue he raised, this is a financial transaction. The paper asset shares are being swapped for a cash injection. That will go towards debt reduction, as the Minister for Finance has made clear. It is also a test of the overall examination of value of AIB. The Government is looking at alternative ways of raising other funding. One of those follows the opening of the European Investment Bank office here in Dublin, which has potential for serious lending of long term, low-interest credit for infrastructure facilities, where a stream of income would be available to repay those loans, whether from tolled motorways, developments of ports or areas of transport like light rail, such as metros or the Luas. The Minister for Public Expenditure and Reform is now conducting a review of the capital programme in partnership with that. The Government allocated almost €5 billion to the Minister for Housing, Planning, Community and Local Government to provide houses across a range of areas and this has been backed up by a suite of changes that have been made by the Government to incentivise both local authorities and housing agencies and provide new impetus for availability of sites and so on. I hope that those three aspects – the review of the capital programme, the opportunity that is now being explored through the European Investment Bank and the capacity for further lending into the system – will bring forward new opportunities for investment here.

The Minister has said that, based on the advice he has received, an initial public offering, IPO, is the best route to recoup the State’s investment in AIB and the key objective is to maximise the proceeds that we can recover over time. The State invested €20.8 billion in AIB through a range of instruments during the financial crisis, and has since recovered €6.6 billion through capital repayments, interest income and fees, and still owns about 99.9% of the ordinary share capital. The primary objective of the Minister and of the Government is to recover all of this investment from AIB. We believe that this is a realistic objective over the medium to long term. There are no changes in the Stability and Growth Pact rules here. It is a transfer of these paper shares for cash, which will go towards debt reduction.

Deputy Brendan Howlin:   The Taoiseach mentioned European Investment Bank money. The Taoiseach knows that the issue is not access to money. Money is cheap and accessible to this country. It is the ability under the Stability and Growth Pact rules to spend it which is the issue. I asked if the Taoiseach has done anything to alter the rules to allow the vital infrastructure spend that we need to be made. We have seen financial advisers working on the sale of AIB stand to gain some €40 million from this action over the past couple of weeks. No such benefit will accrue to the taxpayer. We need to see the money that becomes available used for the productive capacity of the State, to meet the real infrastructure deficits that we need to meet if we are going to face up to Brexit. That is not a view that I only hold. Last week, The Sunday Times reported that Deputy Michael McGrath had similar concerns, while Deputy Pearse Doherty is opposed to the sale. Will the Taoiseach bring proposals to the floor of the House before any further progress is made on this matter since there seems to be a majority in it opposed to the action proposed by Government?

The Taoiseach:   The Minister has already pointed out that there are two potential windows for the disposal of the sale this year, either May or June or some time in the autumn. The Government is fortunately not under any particular pressure to sell, so the market conditions will impact on when the Minister decides to make his recommendation to Government to sell. The sale of the bank shares would not result in a beneficial impact to the general Government balance, as it would not be counted as revenue, as Deputy Howlin is aware.

[Deputy Brendan Howlin:  ] That is the very point I am making.

The Taoiseach:   There is, therefore, no increased capacity to spend. The proceeds from any IPO would be used to pay down debt. As I pointed out to the Deputy earlier, it is possible to spend substantial moneys off balance sheet provided an income stream can be identified from, for example, investment from the European Investment Bank.

Deputy Brendan Howlin:   The Taoiseach knows that the Department of Finance has worked for three years trying to find that.

The Taoiseach:   As Deputy Howlin is well aware, the European Investment Bank is here in Dublin. It is open for business and one of those businesses is to identify streams of income that would have a capacity to repay long-term loans such as, for example, tolled motorways, the development of ports, or provision where there are streams of income from the Luas, metro or light-rail systems. That matter is being actively explored by the Department of Finance with the European Investment Bank.

An Ceann Comhairle:   Time is up.

The Taoiseach:   I hope that it will bring success and that money can be spent off balance sheet. The Minister is already looking at the question of a review of the capital programme for the time ahead.

Triple threat to our low rates as EU targets Irish ‘tax sovereignty’–Brussels’ top economic official has told the Irish Independent that “tax sovereignty” will ultimately be vested at EU level, while Donald Trump has vowed to ship jobs and tax income back to America during his presidency.

 

Donal O,Donovan   Irish  Independent PUBLISHED12/11/2016 | 02:30

The Irish strategy of boosting jobs by acting as a low tax bridge between US corporations and the EU is facing an unprecedented combination of threats, just as the fallout from Brexit rattles the domestic economy. 

Brussels’ top economic official has told the Irish Independent that “tax sovereignty” will ultimately be vested at EU level, while Donald Trump has vowed to ship jobs and tax income back to America during his presidency.

In Brussels, Commissioner Pierre Moscovici said that his push for a Common Consolidated Corporate Tax Base (cccbt) is a response to public demand for action.

“We are in a new world where people want transparency and want the multinationals to pay their fair share of tax where they take profits,” he said. “We are really, I think, not trying to act against national tax sovereignty but to create a European sovereignty in this matter.”

The Commissioner for Economic and Financial Affairs, Taxation and Customs is one of the EU’s most powerful officials. If he’s successful and tax authority shifts from Dublin to Brussels, it will end Ireland’s often controversial but legally protected ability to use independent tax powers to attract US multinationals to set up here when they enter the European market.

The EU push includes having big companies pay tax in territories where they make sales instead of at a global or regional level. That would leave Ireland, as headquarters for a significant number of large multinationals, worse off.

Any major changes at EU level need support from all member states, but Ireland has historically relied on support from the UK in the horse-trading on tax issues at the European Council, but it is set to exit the Union.

The rapidly unravelling global political environment means the Government in Dublin now faces a potentially bruising war on at least three fronts, including the fallout from June’s Brexit vote in the UK.

The Governor of the Central Bank, Philip Lane, told members of employers’ group Isme yesterday that Brexit is now the biggest threat to small business.

Meanwhile, Mr Trump’s senior economic adviser Stephen Moore this week said they will slash corporate tax rates to bring jobs and money “home” to the US.

He predicted “a flood of companies leaving Ireland and Canada and Germany and France.”

The Trump plan is to slash US corporation tax to 15pc from 35pc, the highest in the developed world.

However, the US Ambassador to Ireland, Kevin O’Malley, said he doesn’t believe Mr Trump’s election as president will lead to a mass exodus of American business from Ireland.

Speaking to the Irish Independent, he said: “If you think that Ireland is a tax haven, then you might be concerned about a lower tax rate. But I don’t believe that.

“If, like me, you believe that these companies are here because of the Irish workforce and they’re doing well here – there is no reason for them to leave.”

Some of Ireland’s biggest employers include Apple, Microsoft and Google. There’s an estimated $1.3trn of cash held outside the US by American corporations, according to a report this week by Moody’s.

A tax cut or tax amnesty by the new Trump administration could see much, or even all of that money flood into the US. Even at a reduced rate, the one-off gain would be huge.

Read more: Is EU putting our 12.5pc tax rate under siege? It’s sure starting to look that way

Read more: EU harmonisation push tipped to shrink Irish corporate tax take  

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TRUMP TO REDUCE AMERICAN CORPORATION TAX RATE TO 15%

AFTER BREXIT AND TRUMP ELECTION

Irish Economy and Irish Jobs are in Deadly Danger.This is due to growing dependence on foreign direct investment  fostered By FF, FG and Labour and the Irish Elites over more than 50 years.

PROTECTIONISM-SELECTIVE TARIFFS ON IMPORTS FROM EU TO USA TO BE IMPOSED

FF, FG, LAB COMMITTED THE ULTIMATE BETRAYAL OF THE IRISH PEOPLE. THEY PUT OUR DESTINY IN THE HANDS OF OTHERS

TOTAL DEPENDENCE ON MULTI NATIONALS, THE EU FISCAL TREATY,  PRIVATISATION OF STATE COMPANIES, HAS LEFT IRELAND WITH ZERO SOVEREIGNTY. EIRCOM SHOULD HAVE BEEN DEVELOPED INTO AN IRISH NOKIA NOT PRIVATISED

RECOVERY OF IRISH SOVEREIGNTY IS CENTRAL TO DEALING WITH THE OUTCOME

MULTI-NATIONALS PROVIDE 90% OF IRISH EXPORTS AND 57% OF VALUE ADDED IN THE IRISH  ECONOMY!

US investment in Ireland totals $310bn

As a destination for US investment, Ireland is bigger than Latin America and China

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APPLE Paid No Taxes For 10 years in Ireland!!!!!

         see full article further down

“A former company executive and Irish officials told Reuters the almost tax-free status dates all the way back to Apple’s arrival in Cork 33 years ago.

“There were tax concessions for us to go there,” said Del Yocam, who was vice-president of manufacturing at Apple in the early 1980s. “It was a big concession.” Apple paid no taxes for the first 10 years in Ireland, he added.

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US investment in Ireland totals $310bn, report finds

As a destination for US investment, Ireland is bigger than Latin America and China

Study cites recent investment announcements by Oracle, LinkedIn, Workday and Apple as evidence of deepening economic ties.

US investment in Ireland surged to a record $58.1 billion in 2014, accounting for more than 20 per cent of total US investment flows to Europe.

The figure was contained in a report on the Irish-US economic relationship commissioned by the American Chamber of Commerce in Ireland.

It cites data from the US Bureau of Economic Analysis (BEA), which puts total US investment in Ireland as of 2014 at $310 billion.

This makes Ireland, as a destination for US investment, bigger than many regions of the world, including Latin America ($139 billion), Central America ($118 billion), China ($66billion), Africa ($64 billion), and the Middle East ($52 billion).

The report was launched on Thursday at the American Chamber’s annual president’s lunch event.

Author Joseph Quinlan told The Irish Times that the key finding of his study was that while US investment in the EU was “at best stagnant”, US multinationals were deepening their investment Ireland.

He said there was a “bundle of attributes” related to Ireland which continued to attract US firms. “It is not one variable but many variables-a package of attributes and endowments-that account for Ireland being among the most attractive destinations in the world for US foreign direct investment,” he said.

Chief among them are the State’s fast-growing economy, its wealth in human capital and its pro-business policies, Mr Quinlan said.

The report does not refer to the OECD’s Base Erosion and Profit Shifting (Beps) project and its possible effect on US investment here but describes the State’s low corporation tax rate as a “cornerstone” for foreign firms.

Mr Quinlan said the pace of Ireland’s recovery, with gross domestic product now expanding at 6 per cent annually, had surprised most international observers.

“Ireland’s turnaround reflects the resilience of the economy and Ireland’s adaptability, flexibility and foresight to ever-changing and challenging circumstances, traits that are very attractive to US multinationals.”

In his report, Mr Quinlan cites recent investment announcements by Oracle, LinkedIn, Workday and Apple as evidence of deepening economic ties.

He also highlighted the cutting edge nature of Ireland’s foreign direct investment (FDI), which was being driven by life sciences, social media and telecommunications

“Ireland is doing a very good job of tapping into the global growth drivers by company and by sector,” he said.

On the other side of the ledger, Ireland’s investment stakes in the US are significant as well, with Irish affiliates estimated to have generated some $90 billion in affiliate sales from their US operations in 2014 and $35 billion in US economic output.

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EU to publish new multinational disclosure rules

Tuesday 12 April 2016 07.5

Scrutiny of international tax affairs stepped up after the Panama Papers

The European Commission will issue new proposals later this morning which would force large multinational companies operating in the EU to make public all revenue and taxation details involving any of their operations in countries across the globe.

The move comes amid a growing clamour over alleged global tax evasion by companies and individuals through the use of secretive offshore companies, as revealed in the so-called Panama Papers.

In a separate move, the German and French governments have called for international cooperation to blacklist all territories that breach transparency standards.

European Commission President Jean Claude Juncker had made tax transparency a key priority of his five-year-term, so the Panama revelations have added sharp impetus to proposals that were already in the pipeline.

The so-called country-by-country reporting rule would require all companies with a turnover more than €750m to publish a breakdown of profits, tax, employees and net turnover in countries inside and outside the EU.

Originally the plan would have allowed firms to publish only an aggregate of the data on operations outside the EU, but the new version will require them to open-up details on activities in countries beyond the EU, including in alleged tax havens.

Separately, France and Germany want to blacklist any countries which breach international transparency standards, and to force the publication of the names and beneficiaries of all corporate structures, including shell companies, trusts and foundations that offer anonymity.

The Irish government line is that Ireland has already signed up to new tax transparency rules under the OECD.

But while those rules would allow national tax authorities to exchange information with each other about suspect companies, the details would not be made public.

Taxation is a highly sensitive subject for member states, not least Ireland.

Normally each country has a veto on any taxation issues, but today’s proposals come under the EU’s accounting rules, so ultimately no member state will have a veto on any final outcome.


Ireland Must Resist New Pressures To Give Up Military Neutrality

Recovery of All-Ireland Sovereignty of Irish People More Vital than Ever!

The militarisation of Europe is a far greater threat than Brexit -Prof Ray Kinsella

Irish Independent PUBLISHED11/07/2016 | 02:30

The most searching challenge that the EU faces is not the fallout from Brexit – it’s from the militarisation of Europe and the US-led Nato encirclement of Russia, endorsed by the Nato Summit in Warsaw last weekend.

 

It is as misconceived as austerity and authoritarianism, which are at the heart of the European crisis. But it is infinitely more dangerous. If the Chilcot Report on the war in Iraq proves anything, it is that the momentum towards armed conflict, once started, becomes difficult to contain.

Militarisation will make it much more difficult to deal with the EU’s migration crisis, itself largely a consequence of the catastrophic effects of Western military intervention. A conflagration between US-led Nato and Russia would increase the numbers of refugees in Europe by an order of magnitude. As for the impact of such a conflagration on the European and global economy – well, all bets are off. We could not begin to model the impact – but we can look at post-war Europe and Iraq and Syria and Libya… Only what are euphemistically termed ‘Defence’ industries do (exceedingly) well out of war.

In April, I suggested in these pages that Europe was in denial. It was mired in an identity crisis largely brought on by itself – a crisis of values, democracy – as well as macroeconomic instability marked by inequality, youth unemployment and long-term indebtedness among peripheral countries. There was no trust in Europe. “The governance of the eurozone is characterised by self-interest, subservience among weaker indebted members and, also, tenacity beyond all reason, in persisting with failed policies.”

In June, prior to the Brexit Referendum, I pointed out that “while it was not the job of UK voters to resolve this mess – Brexit can force these same Euro elite to see reality. The EU is incapable of understanding that the dissenting voices across Europe – which they like to dismiss as ‘populism’ – are not the problem: the real issue is the underlying causes that have precipitated opposition to what the EU has become.”

This perspective was vindicated by the EU’s initial response to Brexit – denial, anger and a blame game.

Then, more positively, the first stirrings of a change in attitude by the EU ‘Top Table’ – notably Dr Wolfgang Schäuble – including a decision not to respond to Brexit by pressing ahead with ‘union’ and not to overly pressurise the UK in implementing Article 50.

Militarism threatens this. The process of rebalancing and reform, including greater democratisation across the EU, is now in jeopardy from the increased militarisation of the EU over the last two years, which is set to increase in the wake of the Warsaw summit. It is an appalling prospect.

Why do ‘leaders’ never see these things coming down the track? Every Leaving Cert student knows ‘The Causes of World War I’ – knowledge didn’t prevent it happening. Why did the ‘leaders’, with the notable example of Churchill, not see what was unfolding in Germany in the short few years from 1935 to 1939?

Why did the US not understand the malign dynamic of the Vietnam War during the 1960s – and its consequences for Asia and the global financial system?

Why did ‘leaders’ not envisage the catastrophic impact of the Iraq invasion?

Now, consider this recent statement by Nato: “Since 2014 Allies have implemented the biggest increase in collective defence since the Cold War… Four robust multinational battalions to Estonia, Latvia, Lithuania and Poland … a brigade in Romania … further steps to improve cyber-defences, civil-preparedness and to defend against ballistic missile attack … extend Nato’s training mission in Iraq and to broaden (its) role in the Central Mediterranean … deploy Nato’s Awac surveillance aircraft to support the Global Coalition to counter Isil…”

Now read the Nato Communique issued after last weekend. This is in just two years. The scale and scope of this process has largely gone unremarked. So too have the ironies: of more “training” in Iraq, of support for a “Global Coalition to counter Isil” when we know that it was the military invasion of Iraq that largely created Isil, of “defensive missile systems” ostensibly operated by Nato, which as a recent article in the ‘Wall Street Journal’ points out, “are essentially American initiatives” – and can be redeployed in hours as a long-range offensive system.

The purported justification for this new militarisation of Europe is the intervention of Russia in Ukraine, culminating in the annexation of the Crimean peninsula and its re-integration into Russia.

What is inferred by Nato from this is that ‘a resurgent Russia’ poses an existential threat to Europe. It doesn’t stand up. It also puts fundamental reform of the EU – and peace – in jeopardy. The sensitivities of Poland and the Baltic states to a military threat from Russia are understandable. But that does not mean the argument driving militarisation is robust. Nor does it mean that their interests, and the interests of peace and stability in Europe, are well served by this militarisation of Europe.

Russia is not the USSR. The rebuilding of its economy and infrastructure, including the modernisation of its defence capability, under President Putin does not remotely equate to a threat to its neighbours.

The military capability of the US dwarfs that of Russia, in terms of assets and the number of bases from which to project those assets. Russia’s defence budget is a fraction of that of the US.

Moreover, the track record, and legacy, of Western military intervention in recent decades demonstrably poses a much greater threat to global peace and stability compared with Russia. But indeed any such comparisons are pitiless and, everywhere, add up to incalculable suffering. The decision by the EU to facilitate accession to the EU by Ukraine and, before that Georgia, was foolish and provocative beyond belief. It was foolish because the expansion of the EU has created a ‘Union’ so unwieldy and overextended in its governance as to pose a threat – now all too evident – to its very existence.

Reflect, for a moment, on a ‘Union’ that also included Ukraine and Georgia. To compound that by facilitating accession to the EU – and, by extension, participation in Nato-led security arrangements – of nations bonded to Russia geographically, historically and in terms of language and culture, went way beyond provocation.

It has kick-started a vicious circle of ratcheting-up ‘defence’ spending. The deployment by Nato of men, heavy equipment and missile systems effectively encircling Russia will inevitably elicit a response.

We have seen this kind of dynamic before – it is taking Europe to a bleak place.

The militarisation of the EU has been rapid, largely invisible and facilitated by self-serving propaganda. Diplomacy provides a better basis for engaging with Russia as a European power, with shared interests at a time of global uncertainty.

Militarisation, now unleashed, threatens Europe.

Economist Ray Kinsella is Professor of Banking and Financial Services, and Healthcare at UCD

Irish Independent

Public officials, world leaders, royal families, and sports stars were among those revealed this week as having squirreled vast quantities of wealth away in various manoeuvres designed to cut their tax bill .

Dubbed the Panama Papers, the cache of 11.5 million records showed how a global industry of law firms and big banks sell financial secrecy to politicians, fraudsters and drug traffickers as well as billionaires, celebrities and sports stars.

The revelations centre around a Panama-based law firm called Mossack Fonseca which specialises in building corporate structures that can be used to conceal assets. Among 143 politicians that were exposed were 12 national leaders.

The Panama Papers is also part of a wider story – the growing public ire at how big companies and rich individuals manage to avoid paying a lot of tax, often entirely legally, by the use of various devices.

The Republic’s own role in global tax avoidance was also in the news, as US drug giant PFIZER called off its planned $160 billion takeover of Dublin-based Allergan. The deal collapsed due to new rules in the US aimed at preventing corporate “inversions”, which is the practice of companies moving overseas in tax-avoiding paper-based mergers.

The move would have led to Pfizer’s relocation to Ireland and allowed it to cut its tax bill by an estimated $1 billion annually by domiciling in Ireland. US president Barack Obama this week called the practice “one of the most insidious loopholes out there”.

Speaking after a third round of restrictions aimed at curbing the practice were unveiled, he accused companies of enjoying the rewards of being American “without fulfilling the responsibilities to pay their taxes the way everybody else is supposed to pay them.”

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Apple tax probe could yield billions

Brussels investigating deals between firm and Revenue dating back to 1990s

PUBLISHED30/09/2014 | 02:30    Irish Independent Thomas Molloy

Apple CEO Tim Cook speaks during an Apple event announcing the iPhone 6 and the Apple Watch at the Flint Center in Cupertino

THE State could be forced to collect an unwanted windfall worth billions of euro if Apple is forced to pay legacy taxes following a probe into its affairs by Brussels.

The possibility of a repayment comes as the European Commission explains today why it has begun a detailed investigation into tax deals between the Revenue Commissioners and Apple stretching back to the 1990s.

The Government has resisted the investigation and said repeatedly that Apple has no case to answer.

A finding that Apple had been given illegal state aid would be an embarrassment to the Government here and weaken Ireland’s hand as the international community cracks down on tax avoidance measures.

It could also trigger further probes that would shine a light on how Ireland has convinced so many tech companies to set up shop here.

A US Senate investigation into Apple’s tax affairs in 2013 found that the world’s most valuable company used Irish-registered businesses that were not tax-resident in any country, thereby sheltering tens of billions of dollars in profit from tax.

Apple’s operations in Cork have allowed the company to operate almost tax-free in Ireland since 1980 thanks to tax holidays and other deals. That has saved Apple tens of billions of euro, according to some calculations.

A Commission source close to the investigation told the Irish Independent that some repayment of unpaid taxes was now likely, although they declined to speculate on the figures involved. The fresh probe by the Commission could take 18 months and be open challenge in the courts.

Both Taoiseach Enda Kenny and Apple chief executive Tim Cook say the company did not get a special deal with the Revenue Commissioners.

The European Commission will effectively say today that Mr Kenny’s assurances to the Dail are not enough to stop a full investigation.

The Government has again resisted claims that Apple had a sweetheart deal with the Revenue Commissioners.

But Tanaiste Joan Burton gave a far less emphatic denial than the Taoiseach’s previous comments, saying only that she “would anticipate and hope” that tax arrangements with Apple are compliant.

“If changes are required we will obviously address whatever recommendations are made in the commissioner’s report,” she added.

The Department of Finance reiterated yesterday that it “is confident that there is no breach of state aid rules in this case.” The Government “already issued a formal response to the commission earlier this month, addressing in detail the concerns and some misunderstandings” in the EU’s June decision announcing the probe, it added.

The probe comes at a tricky time for the State. While no other country has taken aim at the 12.5pc corporate tax rate, many are unhappy with other parts of our tax code such as transfer pricing transfer, the setting of prices for intra-group transactions.

The Paris-based Organisation for Economic Co-operation and Development said last month that our tax rules would have to be reformed to effectively outlaw the so-called ‘Double Irish’ tax avoidance scheme which is popular with tech companies such as Google.

US President Barack Obama’s administration has meanwhile banned so-called tax inversions which made it lucrative for some US pharmaceutical companies to buy smaller Irish companies and move their base here to avoid US taxes.

While both measures may still fail, they highlight the challenges faced by the Government as it battles to keep foreign companies in Ireland.

Apple chief executive Tim Cook faced fierce criticism from a Senate subcommittee in Washington last year over the iPhone maker’s tax practices, which had been shrouded from full view behind secretive tax-exempt Irish-based corporate entities.

The European Commission probe will hinge on two periods of intense talks between Apple and the Revenue Commissioners in the early 1990s and again in the latter parts of the last decade. Apple says it went to the Revenue Commissioners looking for guidance on how it should pay its taxes.

Deals around transfer pricing are complex and companies regularly seek guidance from the authorities on how to pay their taxes.

Senator Carl Levin, chairman of the US Senate subcommittee looking into Apple’s tax affairs, said in May last year that Apple had sought “the Holy Grail of tax avoidance”.

A former company executive and Irish officials told Reuters the almost tax-free status dates all the way back to Apple’s arrival in Cork 33 years ago.

“There were tax concessions for us to go there,” said Del Yocam, who was vice-president of manufacturing at Apple in the early 1980s. “It was a big concession.” Apple paid no taxes for the first 10 years in Ireland, he added.

Apple’s investment was a major coup for Ireland. At the time, the country was struggling with high and rising unemployment, double-digit inflation and a brain drain of the young and educated through emigration.

Ireland is not the only country under the cosh.

This morning, European Union regulators will provide more details of their reasons for launching in-depth inquiries into the tax arrangements reached by both the Irish Government and by Luxembourg with a Fiat subsidiary.

The European Commission has launched a similar investigation into the Dutch government’s tax treatment of Starbucks, but details of that will be published later, Euroepan Commisison spokesman Antoine Colombani said.

On Ireland, he added: “In this case, we have doubts that through tax rulings a company may have been granted selective treatment, preferential treatment, compared with what another company under the same rules, the general rules of the Irish tax system, would have received.”

Some tax lawyers told Reuters they doubted whether the Commission could force Apple to repay taxes and said that it was more likely that Ireland would be forced to change its light-touch approach to taxing multinationals.

Asked to comment yesterday, Apple reiterated its June statement, saying it had not received any selective treatment.

Irish Independent

———————————————————–

Speech By Seamus Healy TD on Report by Taoiseach from EU Council In Dáil

Underfunding of Healty Services caused by New Colonialism within Europe

40 Patients on Trolleys at South Tipp General as 7 billion in annual Interest paid to European Banks

Total Surrender of Economic Sovereignty by successive Governments

Dail Record

Deputy Seamus Healy:    Today at South Tipperary General Hospital, there are 44 patients on chairs, trolleys and corridor beds awaiting admission. I am told this is the highest number on trolleys in the hospital in the whole country. What has this to do with the debate we are having here today? It has, of course, everything to do with it. The hospital is starved of resources. Approximately 25% of its budget, or approximately €15 million, has been cut over recent years. This is because the previous Government, namely the Fianna Fáil–Green Party Government, and the current Government, the Fine Gael–Labour Party Government, have agreed to pay €7 billion in debt interest repayments every year to EU institutions and banks. I wonder whether the Taoiseach raised the issue of debt and its renegotiation at the recent meetings. He told us approximately two and a half years ago that there would be a game-changer in regard to debt. It never happened. Now our services, including health and housing services, and economy are being absolutely devastated by the fact that huge sums of money are being paid out of the country to financial institutions right across Europe, including very wealthy ones. Some €7 billion per year is being paid in interest alone.

The fiscal treaty agreed following the Lisbon treaty has created a new colonialism within Europe. That treaty flies in the face of the 1916 Proclamation. It is not a sovereignty-sharing treaty. It effectively sets aside Irish sovereignty and hands it over to big EU powers. It must be renegotiated. This could best be done in the framework of a debt-neutralisation conference. Ireland should demand such a conference and seek support for this demand from Greece, Portugal, Cyprus, Spain, Italy and others. The fiscal treaty requirement for Ireland is essentially a continuation of austerity over the next 20 years. This is linked to the circumstances we note today in South Tipperary General Hospital and the 1,600 children living in emergency hotel accommodation.

The fiscal compact requires that the current budget deficit be reduced below 3% of GDP, that the structural deficit be eliminated by 2018 and that the public debt–GDP ratio be reduced to 60% over the next 20 years. Despite the physical exit of the troika from Dublin, the Government and this country are still bound by the treaty to keep the current budget deficit below 3%. On the other hand, the current budget deficit in Germany, for instance, has been below 3% for the last number of years. It has no structural deficit and the German national debt–GDP ratio is at 57%, already below 60%. In other words, there are no impositions whatsoever on Germany under the fiscal treaty. The treaty is merely a device to force the programme countries and other indebted countries to make huge repayments to stronger countries, led by Germany, although all EU countries were responsible for the banking busts and European recession.

A new economic colonialism has been established within Europe through the fiscal treaty. Owing to this and the payment of €7 billion in interest, the Irish economy and public services, including health, education, housing and other services, are being devastated. Ireland will continue to pay over €7 billion per year in interest on borrowings. Our public service will remain under-funded. Any attempt to reduce our reliance on foreign direct investment through public investment in modern indigenous industry will fail because of that huge payment out of the country.

The combination of our over-reliance on multinationals and the provisions of the fiscal treaty mean the State has virtually no sovereignty or power to ensure the economic and social well-being of its citizens.

The new Dáil must demand the renegotiation of the fiscal treaty and the convention of a European debt mutualisation conference to ensure moneys are available to provide for citizens and public services in health, education, housing and much more besides

Clare Daly and Mick Wallace Arrested arising out of attempt to inspect military aircraft at Shannon

Peace AND Neutrality Alliance

Demonstration Tomorrow Thursday Nov 10,1 pm, Leinster House

————————————————————-

TURKEY(NATO MEMBER) SHOOTS DOWN RUSSIAN JET!

ROGER COLE, SPEAKING at PANA AGM WARNED AGAINST IRELAND GETTING INVOLVED IN EU MILITARY PLANS IN THE MIDDLE EAST. HE WAS RIGHT! SIMILAR WARNINGS BY ED HORGAN in THE IRISH TIMES HAVE NOW BEEN VINDICATED.

US  is supplying arms to Saudi Arabia which is passing them on to Islamic State. Turkey is buying oil from Islamic State which is enabling the caliphate to survive. TURKEY is an ally of France which is bombing Islamic State. Russia is an ally of the SHIA muslim powers, Iran, Iraq and the Alawite Shia Bashir AL ASSAD. Meanwhile Saudia Arabia is carpet bombing Shia areas of YEMEN. Meanwhile, the British Tories, longtime allies of Saudia Arabia and ISRAEL say they now want to begin bombing Islamic state. But what are the real plans and objectives of these big powers?

Any Irish Person who advocates Irish involvement with the EU military block in the Middle East is either demented or a toady of big powers.

Now is the Time to stand up for IRISH NEUTRALITY. Support PANA!

LETTER TO IRISH TIMES : Edward Horgan , Peace and Neutrality Alliance

Sir, – Our Minister for Defence, without Dáil approval, has backed the French decision to invoke Article 42.7 of the EU’s Lisbon Treaty mutual defence obligation. Irish officials said that Irish neutrality will not be affected by the decision. Ministers have repeatedly stated that Ireland is still a neutral state, in spite of allowing over 2.5 million US troops to transit to wars through Shannon airport. Ministers are afraid to acknowledge that Ireland’s policy of neutrality has been abandoned since 2001, because they realise that up to 80 per cent of the Irish people strongly support a policy of positive neutrality that includes active involvement by the Defence Forces in maintaining international peace, and avoidance of becoming entangled in wars.

Of course we should be sympathetic and helpful toward the 129 people killed in Paris. Like many thousands of Irish people, I have immediate relatives, including three grandchildren, living in France.

Ireland and the United Nations have serious obligations under the UN charter to maintain international peace in Syria. Yet the opposite is occurring. The so-called international community is now bombing Syria, contributing to the death toll of 250,000 people since 2011. That’s well over 240 Syrian people killed each day. That means that up to 25,000 Syrian children have been killed.

What Ireland must do is to promote peace in the Middle East and to oppose wars, and thereby to stop the killing of Syrian and other Middle Eastern children (and adults). This will eventually stop the sort of terrorist attacks that have killed children and adults in Paris, London, Madrid and New York.

The only justified “mutual defence treaties” are those that respect the mutuality of humanity, including our friends and neighbours in Syria and Paris. – Yours, etc,

EDWARD HORGAN,

Castletroy, Limerick.

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  1. May 22, 2016 at 11:51 am

    I’m very impressed by the report in this article by Paddy Healy’s, great work on putting it together. Pity our Political esteemed parties of F.F./F.G./Lab have not woke up yet, but the people of Ireland have….

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