EU commissioner wants Ireland to raise the 12.5% corporate tax. Yay or Nay?

GizAGoOfYerGee

Olli Rehn, the European commissioner in charge of economic policy, said the dire state of its public finances means Ireland will likely have to surrender its status as a low-tax haven within the EU.

"It's a fact of life that after what has happened, Ireland will not continue as a low-tax country, but rather it will become a normal-tax country in the European context," he said.

Microsoft, Google, Amazon, eBay, PayPal, Yahoo!, Facebook and Pfizer (among others) now have European headquarters and/or operational bases in Dublin city.

By raising the Irish coprporate tax, we risk losing these technology companies to the UK, Germany and others.

Brian Lenihan, the Irish finance minister, acknowledged this week that taxation will form part of the solution to stabilising the deficit. But Irish ministers insist the country’s low 12.5 per cent corporate tax rate will not be altered.

Thoughts?

Donkey Oaty

Ireland says "No".

mikom

Donkey Oaty wrote: »

Ireland says "No".

Lisbon says Yes.

http://williamthecoroner.files.wordpress.com/2008/09/istock_can-of-worms.jpg

SEPT 23 1989

They have us by the balls because of FF and the banks

Scuid Mhór

Donkey Oaty wrote: »

Ireland says "No".

mikom wrote: »

Lisbon says Yes.

http://williamthecoroner.files.wordpress.com/2008/09/istock_can-of-worms.jpg

and that was that.

brianthebard

We can definitely afford to raise it a couple of percent with minimal impact on businesses. However France would love to push it up as far as possible, and if they get their boot in it could be over 20%.

johngalway

I voted 15%. Though my stand would be keep it at 12.5%. However, we're not in the best position, and if pressed hard I would not like to see the rate go above 15%.

force eleven

Why are they bothered about our puny little island anyway? Apart from that 50 billion euro deficit of course...

The Brussels eurocrats have wanted harmonization on the tax front for years, and now they see the opportunity at last. It won't be the only price we'll pay.

At least Peter Sutherland will be happy.:mad:

kippy

Its got fcuk all to do with Lisbon. Its to do with the billions we now require to borrow from Europe to stay afloat.
Typical anti lisbon fare - anything negative that has happened in in the last year has been blamed on Lisbon by the Anti Lisbon crowd, without them acknowledging the elephant in the room.
Has anyone done a Cost Benefit Analysis on what the extra income to the exchequer would be for every percent raised in this tax (not of course taking into account the potential losses?)
Id rather see our political class (Dail, seanad, local councilers and associated "support services" and a number of higher paid civil servants as well as matrix management structures) cut in numbers. We are way over represented.
Reduce social welfare, reduce minimum wage by a lesser percent than the social welfare, review all Public sector quangos/roles, bring ALL sectors of society into the tax net.

Wolfe Tone

That tax rate is about the only good thing with our economy. Keep it that way!!

TheZohanS

Keep it at 12.5%, if we mess around with that the likes of Intel, HP and other multinationals might up and move somewhere else.

Mr Benevolent

We must increase our tax base, we have no other option.

Donkey Oaty

mikom wrote: »

Lisbon says Yes.

Foreign companies then say "Adeus".

MCMLXXXIII

According to what you say, German tax is 15%. According to your chart, German tax would be at least double because of local tax, which Ireland does not have.

Taxes could easily be raised to 15% without loosing jobs to Germany, Poland, the UK, etc.

Unless, of course, places like Macedonia, Latvia or Bulgaria are considered a real threat for Irish business and employment. Statistically, their wealth and education distribution is about the same as Ireland, and they have a standard of living that is only slightly worse.

I think the question should be: Why are companies not moving to Cyprus with comparable distribution of wealth, education, standard of living and Purchasing Power when their tax is only at 10%, and how high of a tax be charged before it runs these companies out of Ireland?

Wolfe Tone

Increase the corporate tax perhaps, but lower the minimum wage?

Orange69

As a tax heaven Ireland will never innovate or strive to be better. Its like being on the dole long term or giving free money to the 3rd world. Lack of necessity to do better facilitates stagnation and apathy.

Donkey Oaty

MCMLXXXIII wrote: »

Unless, of course, places like Macedonia, Latvia or Bulgaria are considered a real threat for Irish business and employment. Statistically, their wealth and education distribution is about the same as Ireland, and they have a standard of living that is only slightly worse.

Easy there, 1983 - there's no comparison, surely? A quick search suggests that the average take-home pay in Macedonia is less than 400 Euro a month.

Augmerson

Low Corporate tax means we attract multi-nationals who then employ thousands of workers sure, but the profits made by those companies, which are huge, are just going straight out of the economy.

galwayrush

FF promised it was not in danger , obviously we have nothing to worry about, it's not like they tell lies now, is it?..................oh wait................:eek:

MCMLXXXIII

Donkey Oaty wrote: »

Easy there, 1983 - there's no comparison, surely? A quick search suggests that the average take-home pay in Macedonia is less than 400 Euro a month.

Donkey, you are the first person to ever refer to me by 1983 - the true meaning of my screen name...most people don't get it!
That's awesome.

On another note: yes, I did look at that, but how much did the Irish make before the Celtic Tiger began? It might not be as low as Cyprus's 900 Euro a month, but that is why I asked a two part question. Second part: "...how high of a tax be charged before it runs these companies out of Ireland?"

Could someone just ONCE spell it correctly 'yea or nay'?

Donkey Oaty

MCMLXXXIII wrote: »

Second part: "...how high of a tax be charged before it runs these companies out of Ireland?"

That's the important question, but whatever the answer is, we should set the tax at very slightly lower.

Jeboa Safari

If corporation tax is raised to an EU level we're proper ****ed. It's one of the few things our economy still has going for it. I'd actually go and protest if they were going to try and raise this, and I'm no fan of protests at all.

musings

Augmerson wrote: »

Low Corporate tax means we attract multi-nationals who then employ thousands of workers sure, but the profits made by those companies, which are huge, are just going straight out of the economy.

Correct, and I might add that a large proportion of the workers are foreigners here for a short time, esp in the case of european customer service centres where native language speakers are required.

While I do think these multi nationals are helpful here, I think they are completely over hyped and are of a much lower real significance than Agriculture and the food industry.

The chemical industry in Ringaskiddy doesn't even pay Irish VAT!

Jeboa Safari

musings wrote: »

Correct, and I might add that a large proportion of the workers are foreigners here for a short time, esp in the case of european customer service centres where native language speakers are required.

While I do think these multi nationals are helpful here, I think they are completely over hyped and are of a much lower real significance than Agriculture and the food industry.

The chemical industry in Ringaskiddy doesn't even pay Irish VAT!

Those workers pay taxes and spend money here though

musings

Jeboa Safari wrote: »

Those workers pay taxes and spend money here though

Yes, but that goes for all workers native or foreign (well almost all), and wouldn't it be better if all these workers had tax paying employers also?

Sea Sharp

If we raise the taxes even slightly, the multinationals will get spooked and pull out. 50bn in debt with the possibility of IMF intervention. The 12.5% tax rate is the only thing this country has going for it and it was what caused the Celtic Tiger.

Absolutely NO, NO, NO and NO to rising corporation taxes.

Although, hypothetical situation: If we raised it to 50% over night, how much money could we make before every company managed to pack up and leave. If that figure works out at 50bn plus, it's food for thought. :pac:

Jeboa Safari

musings wrote: »

Yes, but that goes for all workers native or foreign (well almost all), and wouldn't it be better if all these workers had tax paying employers also?

They do have tax paying employers. Just not at the big rates like the European countries. If you upped it, theres a good chance they'd leave. So you'd lose out on the tax they're already paying, aswell as the workers they employ.

oppenheimer1

When the commissioner was talking he wasn't referring specifically to Corporation tax, but the low rate of personal taxation that exists in Ireland, relative to other European countries. Irish wages are higher and personal tax rates are a lot more generous than in most other countries.


As for corporation tax, that was the goose that laid the first golden egg, and the holy grail of the Irish economy. It would be a foolish government to accept a bailout package in exchange for a rise in rates. We haven't managed to steal all the FDI from europe because of it, if we had we wouldn't be in the situation we find ourselves in either. Another thing people are forgetting that while we might have to go beg for money from the solidarity fund, the Irish government is in a relatively strong position with regards to negotiating. The money we have borrowed belongs largely to German banks and if we cannot pay, they will collapse, precipitating another banking crisis. In addition an Irish default would swiftly bring an end to the Euro and the European project, Germany's baby, would be teetering on the edge of collapse. If the Irish are pushed too far and made to give up too much sovereignty, they could make the whole house of cards come down. Blackmail may be the last resort for our scoundrels.

musings

oppenheimer1 wrote: »

When the commissioner was talking he wasn't referring specifically to Corporation tax, but the low rate of personal taxation that exists in Ireland, relative to other European countries. Irish wages are higher and personal tax rates are a lot more generous than in most other countries.


As for corporation tax, that was the goose that laid the first golden egg, and the holy grail of the Irish economy. It would be a foolish government to accept a bailout package in exchange for a rise in rates. We haven't managed to steal all the FDI from europe because of it, if we had we wouldn't be in the situation we find ourselves in either. Another thing people are forgetting that while we might have to go beg for money from the solidarity fund, the Irish government is in a relatively strong position with regards to negotiating. The money we have borrowed belongs largely to German banks and if we cannot pay, they will collapse, precipitating another banking crisis. In addition an Irish default would swiftly bring an end to the Euro and the European project, Germany's baby, would be teetering on the edge of collapse. If the Irish are pushed too far and made to give up too much sovereignty, they could make the whole house of cards come down. Blackmail may be the last resort for our scoundrels.

Evil but Brilliant!!!!

gleep

We should keep the rate at 12.5%. And right now the dept of finance (or someone competent) should be looking at introducing a CT tax credit for companies to incentivise them to bring jobs here.

Just an idea, but could we give companies a tax credit for every job they create? Sure, we'd loose CT revenue, but we'd get people off the dole, paying PAYE and spending in the economy. As I said just an idea, it might be foolish but we need ideas if we're to get out of this.