2nd September 2016
Ireland’s economy could well have grown between 6 and 8% more a year since 2010 were it to receive the £10.9bn tax revenue from Apple ordered by the European Commission this week.
Ireland’s GDP grew by a remarkable 26.3% in 2015 according to the latest revisions. There is already speculation that Ireland’s GDP has seen a huge uplift due to international firms relocating much of their intellectual capital to Ireland and there is speculation that a large proportion of this is due to a reorganisation of Apple’s corporate structure. Ireland will already have to contribute an additional Euro 280m to the European Union.
Apple has already allocated the tax to an escrow account, but it has not been paid to the Irish exchequer pending an appeal.
Speaking to the Guardian, Seamus Coffey, a lecturer in economics at University College Cork, said: “If the European Commission ruled this profit should be taxable in Ireland, it should be reflected in the GDP numbers. The Commission is essentially reallocating the profits from the US to Ireland. They are now saying the output produced in Ireland is billions more. The 2015 number won’t change. What will happen is the years before it will rise up.”
Coffey calculates this could see a significant uplift of around 6%-8% a year which big implications – on paper – for previous years with growth at zero in 2011 and shrinking in 2012.