Irish rocker Bono once said Ireland¡¯s low-tax, pro-Big Tech economic model had brought the country of 5 million the only prosperity it had ever known.
But that prosperity came at a price, from lost investment at home to lost reputation abroad as huge taxable profits vanished under countries¡¯ noses. Now that judges in Luxembourg have backed an order for Dublin to claw back €13.8 billion ($15.2 billion) in benefits illegally granted to Apple, what happens next should compensate all victims of a broken corporate tax system and fix it for the future.
Willingly forgoing billions in taxes doesn¡¯t just happen overnight with a wink and a fax from the Irish finance ministry. It¡¯s the grim conclusion of decades of aggressive tax planning from multinational corporations and their advisers shopping for the best deals; cutthroat competition between countries driving tax rates inexorably downward; and a huge creaking edifice of laws that offer tantalizing loopholes in the digital age. The code that effectively granted Apple¡¯s Irish unit a tax rate of 0.005% was one low point among many during the boom in profit-shuffling, patent-licensing chains used by everyone from Alphabet to Starbucks.
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