Re: 'defies reality and common sense'
>"As per EU rules, It's illegal for the Irish government to allow a company, regardless of it's size or the employment it creates, to pay far less tax than what the rest of companies in the country pay."
I am sorry, this is not correct. Under the EU rules a special tax regime or tax exemption would be considered a form of state aid. The state aid is generally prohibited in the EU, however if one asks them nicely, it is ok (meaning, if it is approved by the Eurobureacrats following the established procedure, then it is legal). The current list of approved state aid recipients can be found e.g. here:
Ford, Coca Cola, Fiat, Renault, Dell, Amazon, Volvo, BMW, FIAT, Peugeot, Samsung, Johnson&Johnson, Pfizer, Nissan, Skoda, Glaxosmithkline, Rackspace, HP, Sony, Barclays, IBM & a lot of other big names are among the recipients of 'legal' state aid.
The forms of 'legal' help include, among others, 'tax benefit', 'tax allowance', 'tax credit', 'tax relief', 'tax grant', 'tax premium' and 'tax exemption'.
The problem with Apple is, the European Commission determined Apple's Irish tax arrangements to be 'incompatible' (not approved) state aid, and asked Apple to return the monies plus interest (as free use of the monies is also a form of state aid). They are not accused of tax avoidance, they are asked to return the 'state aid' where the due process was not followed.
The Irish Government are apparently more than happy to keep the existing scheme since it is much more beneficial for the Irish finances in the long run than getting the 'aid' back and risking quickly losing the largest and most competitive part of the economy, becoming [again] yet another indebted EU country with no jobs. I hope this is not what the EU bureaucrats are trying to achieve.
Sometimes I wonder if the EU economy would be better off competing as a single block with other large economies rather than trying to ensure that all economies inside the block are 'equal'. For example, by making sure that foreign investment and high-tech jobs prefer to stay in the EU rather than go to China/Asia.