News Archive

Apple tax receipts could help cut Ireland’s debt pile

Posted by: Admin | Posted on: August 31st, 2016 | 0 Comments

LONDON The European Commission’s ruling that Apple should pay 13 billion euros of back-dated taxes could help Ireland reduce its debt significantly but may undermine the Irish government in the process, Standard Poor’s told Reuters on Thursday.

“There are many uncertainties ahead but if we assume that the money will definitely come through, the sum of 13 billion euros is not insignificant for an economy the size of Ireland,” said Moritz Kraemer, the ratings agency’s chief European sovereign rating officer.

The sum of 13 billion euros constitutes more than 5 percent of Ireland’s gross domestic product, and would allow the country to bring its debt down to around mid 80 percent of gross domestic product if the government uses it for that purpose alone, he said.

However, Kraemer warned that the ruling might destabilizes the current government and its ability to formulate and implement policy — an important rating factor that Standard Poor’s looks at.

“If the government chooses not to accept the 13 billion euros at a time when they have stated the money is not there for other spending needs, it could undermine them in the eyes of the public and weaken their position,” he said.

Kraemer added that it may be that the Irish business model is being put to the legal test.

(Reporting by Abhinav Ramnarayan; editing by Dhara Ranasinghe)

Article source:

Comments are closed.