Republic of Ireland news

Leo Varadkar: UK should have a 'Norway-plus' link with EU after Brexit

Taoiseach Leo Varadkar said the Republic wants the UK to have a close relationship with the EU. Picture by Niall Carson, Press Association
Staff Reporter and David Young

BRITAIN'S post-Brexit relationship with the European Union should be closer than that of non-member Norway, Taoiseach Leo Varadkar has said.

Attending the World Economic Forum in Davos in Switzerland, Mr Varadkar said any agreement between the UK and the EU will have to be specific, given the unprecedented nature of the 2016 Brexit referendum.

"Of course as Ireland we want that to be as close as possible - we would have it ‘Norway-plus’ but I think we have to get into the detail now of what that means," he told Bloomberg Television.

Norway is part of the EU's single market but not the customs union.

It had been hoped that Northern Ireland could remain in the customs union and single market in all but name after the UK leaves the EU.

However, a possible deal in December between Theresa May's government and the EU was scuppered in December by the DUP.

DUP leader Arlene Foster said her party "will not accept any form of regulatory divergence" that separated the north from Britain.

Mr Varadkar suggested yesterday "perhaps we can negotiate something that isn’t very different to that (the customs union and single market)".

Meanwhile, the Taoiseach said the Republic's corporate tax system has been subjected to unfair criticism over its controversial arrangement with tech giant Apple.

Mr Varadkar insisted the state was a global leader when it came to tax transparency.

In 2016, the European Commission ruled that Apple had not paid enough tax on its corporate profits in the Republic - deeming the complex arrangement in breach of EU state aid rules.

It subsequently ordered the government to claw back around €13 billion from the iPhone maker.

The ruling has been disputed by the Irish government and Apple, and both are challenging it in the courts.

The Republic will collect the money prior to those legal challenges, but it will not be spent until a final outcome has been reached.

Confirming that the process of securing the money from Apple would begin in the coming months, the Taoiseach said the Republic had been on the end of "unfair press" over the furore.

"The allegation is that Ireland had some sort of special deal with Apple and we didn't - and we believe we can prove that in the courts," he said.

Mr Varadkar said the case had not made a favourable impact on the Republic's international reputation.

"It certainly hasn't been helpful," he told Bloomberg TV.

"Ireland is a country with a very clear tax policy, we have had it for a very long time now, our corporate tax is 12.5% - it's not going up, it's not going down - and unlike a lot of other countries there are very few get-out clauses and exceptions and credits.

"Other countries have a higher tax rate on paper but actually they collect less and the OECD figures prove that, so it certainly hasn't been helpful.

"Ireland has got some bad press as a result of it but I don't think that's fair.

"We are really one of the most transparent countries when it comes to tax, the fact we have a rate that is low, simple and transparent."

Mr Varadkar has been forced to defend the Republic's tax regime from critics elsewhere in Europe.

His visit to Davos came amid a push for greater tax harmonisation across the bloc. Mr Varadkar has opposed the concept and insists the Republic will retain tax sovereignty.

The Taoiseach also said he was confident moves by the Trump administration to cut taxes and prioritise US-based companies would not have a significant impact on foreign direct investment in the Republic.

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