EU shows its true colours over Apple
Of all the distortions and misunderstandings propagated by the politicians who sought to keep Britain inside the European Union, perhaps the worst was the idea that EU membership represented a commitment to economic openness and free markets while leaving would be an act of economic regression, a rejection of free markets in favour of closed economies and the policies of the past.
As with so many of the Remain camp’s arguments, the evidence since Britain’s referendum vote has shown this one to be wholly incorrect. Just as the UK economy has so far failed to live up to the Remainers’ prophesies of doom, so the EU has failed utterly to demonstrate the commitment to economic openness they insisted on attributing to it. Indeed, the EU has done the opposite, showing that it is instinctively opposed to the free-trade and pro-business policies that are the best way to deliver prosperity, freedom and fairness.
The European Commission’s dealings with Apple and Ireland are a textbook example of what is wrong with the EU, both economically and politically. Economically, a punitive approach to the taxation of highly mobile international corporations is an act of self-harm: such firms can and will relocate to countries that do not seek to milk them for every penny of tax they can. Politically, it is an affront to democracy that the unelected Commission in Brussels should presume to dictate to Ireland’s government what taxes it should levy. Nor is this an approach only applied to smaller states: last week, some EU leaders warned Britain against further cuts in corporation tax.
Meanwhile, politicians in Germany and France are in an unseemly rush to declare the death of the Transatlantic Trade and Investment Partnership, the proposed free-trade deal between the EU and the US. TTIP as drafted was not perfect (what international agreement is?) and the economic gains may not be as large as some advocates suggest. But the detail is less important than the broad principle: the more countries trade with each other, the richer and more stable the world becomes. And the EU has rejected free trade.
These depressing events are the background for today’s Cabinet meeting to discuss Britain’s departure from the EU. It is inevitable that the issue of our relationship with whatever remains of the EU will consume much political time and energy. But we must remember that UK-EU relations are only part of the future. Outside the EU we will be free to pursue the ideals of free trade and free markets with new vigour.
Downing Street’s reaction to the Apple case was the right one: if Ireland and the EU do not want a huge, wealth-creating firm doing business in their territory, Apple will be very welcome in the UK. Britain’s approach to trade should be the same. If the EU does not wish to strike a deal with the world’s biggest economy, Britain will happily pursue a free-trade agreement. Being an EU member technically prevents the UK from starting trade negotiations with other states, a restriction that is one of the best reasons for Theresa May to get Brexit under way sooner rather than later.
Whenever our departure comes, however, we must remember that Brexit brings opportunities and that many of these will be found far away from an EU that is showing its true colours as a hidebound and inward-looking organisation unfit for the 21st century.