Wednesday, February 15, 2012

The Irish Problem

Some of the UK's biggest and most courted employers like Microsoft, Google, Dell and Facebook pay, effectively, little or no tax in the UK.

The only reason they are able to do this is that they - totally immorally by any measure - invoice from Ireland. But EU law allows for this. I personally have no idea why the UK is still in the quagmire that is the EU.

The UK is owed some £70bn by Ireland. Therefore Britain does not want a harmonised EU tax regime, they do not care if Google and their US software ilk pay the tax they should be paying through blatant tax avoidance schemes.  They just want to make sure that Ireland has enough money to pay the interest they owe the UK. Let's face it, Ireland is to the UK what Greece is to Germany.

In fact, I don't believe that the UK does not care about the EU or the Euro. The UK has a liability in Ireland that is greater than all its other liabilities mounted up and this is what makes up policy.

The good news is that the Irish are great creditors. They are adept at exporting their greatest asset - their brilliant people, and at exploiting their second greatest asset - not taxing corporations - for as long as they can get away from it.

As ever in history, Ireland is the UK's biggest problem. At least now it's down to economic bombs, not real ones, but the use of UK taxpayers' money to prop up Ireland is just wrong. Like Greece, Ireland needs to recalibrate to a realistic level, and the UK needs to take back the £7bn or so of lost taxes that are indulged to our celtic brethren every year. And, more than anything, corporate taxes across Euope need to be normalised if we are to pretend to have a single market.