Not Far From The Tree

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Apple-France-in-visit-in-Cork

Apple’s Cork HQ during a visit by French Apple staff in 1980.

 

A former company executive and Irish officials told Reuters the almost tax-free status dates all the way back to Apple’s arrival in County Cork 32 years ago.

“There were tax concessions for us to go there,” said Del Yocam, who was Vice President of manufacturing at Apple in the early 1980s. “It was a big concession.”

In fact, the deal was about as good as a company can get.

We had a tax holiday for the first 10 years in Ireland. We paid no taxes to the Irish government,” one former finance executive, who asked not to be named, said.

Apple wasn’t an exception, although it was among the last to enjoy such favorable treatment. From 1956 to 1980, Ireland attracted foreign companies by offering a zero rate of tax, according to the Irish government’s website. Eligible companies arriving in 1980 were given holidays until 1990.

“Any multinational attracted into Ireland that was focusing on the export market paid zero percent corporation tax,” said Barry O’Leary, CEO of IDA Ireland, which is charged with attracting investment into Ireland.

Apple said it pays all the tax due in every country where it operates. It declined to comment on the tax treatment it received in the 1980s.

As part of Ireland’s accession to the European Economic Community, precursor to the European Union, in 1973, it was forced to stop offering tax holidays to exporters.

From 1981, companies arriving in Ireland had to pay tax, albeit at a low 10 percent rate, providing they qualified for manufacturing status.

Apple’s investment was a major coup for Ireland. At the time, the country was struggling with high and rising unemployment, double-digit inflation and a brain drain of the young and educated through emigration.

“We were the first technology company to establish a manufacturing operation in Ireland,” recalled John Sculley, Apple’s CEO from 1983 to 1993. He said government subsidies had also played a role in deciding to set up a base in Ireland.

Apple told the subcommittee it could not answer questions about why it chose Ireland as a base since it had lost the paperwork from the period.

The operation in Cork built the company’s Apple II computer and would later build disc drives, ‘Mac’ computers and others.

 

Apple enjoyed Irish tax holiday from the start (Reuters)

Previously: A Long Way From £2 Apple

PIc; Apple

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