U2 frontman Bono has expressed support for regulations in Ireland that some believe result in a tax dodge for big business entities.
In an interview with The Observer, Bono defended his homeland’s low corporate tax rate.
“We are a tiny little country, we don’t have scale, and our version of scale is to be innovative and to be clever, and tax competitiveness has brought our country the only prosperity we’ve known. That’s how we got these companies here… We don’t have natural resources, we have to be able to attract people.”
The result is more hospitals, firefighters, and teachers for Ireland, added the self-described “natural social Democrat.”
Bono is well known for leading philanthropic initiatives that are fighting poverty and disease, particularly in Africa. He also may or may not be the world’s wealthiest musician as a result of his investment in the Facebook IPO. Among other ventures, the U2 lead singer heads his charity organization ONE, which takes up social causes all over the globe, and has enlisted world leaders in these efforts.
The European Union has launched a probe into controversial tax incentives that Ireland provides to big business entities such as Google or Apple, that latter of which U2 partnered with to release its latest album.
These multinational corporations could possibly be on the hook for billions in back taxes if the EU gets its way.
“Brussels is pressuring Ireland to end its highly controversial tax policies or face a full investigation, which could lead to multimillion-euro penalties. The Double Irish loophole allows U.S. companies, mostly in the technology and pharmaceutical sectors, to reduce their effective tax bill far below Ireland’s already generous 12.5% corporate tax rate by shifting most of their taxable income from an operating company in Ireland to another Irish-registered firm located in an offshore tax haven, such as Bermuda. This controversial structure enables many U.S. multinationals to avoid paying tax on their UK sales, by diverting them to the Irish Republic,”The Observer explained.
About a year ago, Bono acknowledged that a portion of U2’s income was parked in the Netherlands to avoid Irish taxes.
According to The Independent, “Apple has paid an average tax rate of 2.5 per cent over the past five years, despite turning over a profit of around $109 billion. This is a fraction of Ireland’s standard tax rate of 12.5 per cent.”
Back in late 2012, Bono generated a lot of social media buzz when he proclaimed that only capitalism, commerce, and entrepreneurship can lift people out of poverty, and that various forms of welfare only provide what amounts to a band-aid on the problem.
Does it surprise you that Bono is defending corporate tax havens/tax shelters such as Ireland?