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Old Boys club still protecting tax avoiders - Carthy

21 October, 2015 - by Matt Carthy MEP


Sinn Féin MEP for the Midlands North West, Matt Carthy, speaking following the EU Commission's state aid investigations against Luxemburg and the Netherlands concerning tax deals with Starbucks and Fiat Finance and Trade, said that the "Old Boys Club" protection of tax avoidance and evasion by wealthy corporations was still in place.

Carthy, a member of the European Parliament's Economic & Monetary Affairs Committee, stated:

"It has now been confirmed that EU law was violated – This occurred in Luxemburg during the leadership of the current President of the EU Commission, Jean-Claude Juncker, and in the Netherlands under now President of the Eurogroup, Jeroen Dijsselbloem.

"These are the same men who led the subjection of Greece to one of the most humiliating episodes of our time.

"These technocrats will, it seems, remain unanswerable to the people of Europe while at the same time continuing to favour vested Corporate Interests.

"What's now required rather than mere publicity stunts or cosmetic changes is a fundamental overhaul of EU Competition Law which, as it stands, is extremely restrictive.  It provides for recovery of unpaid taxes which constitute illegal state aid, but it does not impose any penalties.

"European competition law requires that no company suffers from tax disadvantages on a national level. Therefore, as long as there are no special guarantees for particular corporations, low taxes for corporations at the expense of the majority of taxpayers are consistent with EU law. As a result, the Commission's investigations – which consume significant resources – lead to negligible financial losses for multinational corporations, and will not jeopardise the profitable business practice of tax evasion or avoidance.

"The issue is not the right of governments to set their own tax rates, including corporation tax; this is one that I have defended at all times.

"The issue is that it is absolutely indefensible to allow hugely profitable companies free reign to manipulate both European and Irish tax legislation while ordinary citizens are forced to comply with unjust and unfair taxation measures introduced by our Government.

"The key question now is whether Minister Noonan will put the interests of the Irish people first or whether he will continue to protect vested financial interests.

"The EU Commission is reported to have suggested that the penalty owed to Ireland in unpaid corporation taxes could be over €1bn.

“The failure of the government to insist on the payment of such sum would reiterate the fact that they are indeed part of that Old Boys Club that protects tax avoiders and evaders."

ENDS

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