Our corporation tax rate - something to be ashamed about

Climber

Let's think about this for a minute.

The only thing that pretty much all politicians and economists agree with is that the corpo tax rate of 12.5 percent is not up for renegotiation, as if it's something to be proud of. This leaves a very uneasy feeling in my stomach. Why?

We set this low rate to attract foreign companies, presumably because we paddies are incapable of creating our own. This had to be viewed as a sign if failure on behalf of us as a nation. If Europe was a brothel Ireland would be the cheapest whore who is willing to do all the extreme nasty stuff for rock bottom prices! Not something to be proud of, something to be embarrased about.

If we had the backbone of Germany we would increase the corpo tax rate to a reasonable rate. However, we will be dragged through the system to make this decision and cry foul play to the EU, patethic.

MagicMarker

What a silly argument. If anything we should lower the corp tax rate.

Lame Lantern

How on earth do you figure that domestic companies don't benefit from low corporation tax? As a matter of fact, home-grown firms grow significantly more rapidly than most true startups of our neighbours as a result, and as has been pointed recently, per capita our corporate tax take is greater than that of Germany and France due to the hitherto robustness in our private sector that our corporate tax regime is in large part responsible for.

johngalway

Climber wrote: »

Let's think about this for a minute.

I wish you had.

Increase corporation tax rate = lose jobs because multinationals pull out to cheaper locations.

Great for the country, let's do it :rolleyes:

Cool Mo D

Low tax rates are nothing to be ashamed about.

The reason Germany and the larger European companies have higher corporate tax, is because they have massive native conglomerates that cannot easily leave the country, and are a handy source of tax. Many of these companies were first established when the larger European companies first industrialised.

The larger European countries don't need to be have lower tax rates for this reason. Since Ireland only industrialised after the most of the larger nations, we don't have long established corporate giants to milk for tax. Instead, we have a low tax rate to attract mobile industries.

The larger European countries want it both ways - to keep their tax rates high to keep their own cash cows, and to keep our taxes high to prevent us attracting away more mobile industries from their high tax regime.

There is no moral dimension to the larger countries arguments: they want to preserve their advantages, and we want ours. All the rhetoric from France and Germany about 'social dumping' and the like is just papering over the real issue.

Penisland

Climber wrote: »

Let's think about this for a minute.

The only thing that pretty much all politicians and economists agree with is that the corpo tax rate of 12.5 percent is not up for renegotiation, as if it's something to be proud of. This leaves a very uneasy feeling in my stomach. Why?

We set this low rate to attract foreign companies, presumably because we paddies are incapable of creating our own. This had to be viewed as a sign if failure on behalf of us as a nation. If Europe was a brothel Ireland would be the cheapest whore who is willing to do all the extreme nasty stuff for rock bottom prices! Not something to be proud of, something to be embarrased about.

If we had the backbone of Germany we would increase the corpo tax rate to a reasonable rate. However, we will be dragged through the system to make this decision and cry foul play to the EU, patethic.

Low corporation tax does not equal low yield and has many advantages to domestic companies....needless to say cheaper exports which is one of the only sectors of the economy that is booming.

drunkmonkey

Were a tiny island in the Atlantic with no road or rail ties to the rest of the world, we need an edge as anyone in mainland Europe has a lot more business benifits to offer investors.
Increase the corporation tax and we may as well pull the anchor up and set sail for the americas.

cassi

Op, I'm struggling to understand how you see getting large numbers of large companies to not only set up shop here but to set up headquarters and thus investing million if not billions in our country, a failure?!

Einhard

Climber wrote: »

We set this low rate to attract foreign companies, presumably because we paddies are incapable of creating our own. This had to be viewed as a sign if failure on behalf of us as a nation. If Europe was a brothel Ireland would be the cheapest whore who is willing to do all the extreme nasty stuff for rock bottom prices! Not something to be proud of, something to be embarrased about.

"Extremely nasty stuff"? Eh, what exactly do you think goes on in the multi-nationals? Microsoft et al do the exact same thing in Ireland as they do in France- the only difference is we charge them less for the pleasure. Nothing wrong with that. I presume you picket Lidl and Aldi also? After all, they have lower rates to attract customers too. Filthy bastards.

If we had the backbone of Germany we would increase the corpo tax rate to a reasonable rate. However, we will be dragged through the system to make this decision and cry foul play to the EU, patethic.

If we had an internal market of 70 million people, maybe we'd get away with increasing our corporation rates. What you're suggesting isn't "backbone", but idiocy.

RoastBeefDinner

I agree with the OP. We as a nation are underselling ourselves be offering multinationals cheap corp tax.
Think about it? Where on this earth are they going to find a relatively young educated hungry workforce such as our own? Eastern europe? Asia? Yeah right:rolleyes:
They (the multinationals) already have enough tax breaks on their profits for which incidentally do not remain in Ireland.
Everything that has been achieved in Ireland over the past 20 years needs to be erased and get back to basics. Build a real economy where the wealth actually stays in the country and not in the the EU or American banks.

Penisland

RoastBeefDinner wrote: »

I agree with the OP. We as a nation are underselling ourselves be offering multinationals cheap corp tax.
Think about it? Where on this earth are they going to find a relatively young educated hungry workforce such as our own? Eastern europe? Asia? Yeah right:rolleyes:
They (the multinationals) already have enough tax breaks on their profits for which incidentally do not remain in Ireland.
Everything that has been achieved in Ireland over the past 20 years needs to be erased and get back to basics. Build a real economy where the wealth actually stays in the country and not in the the EU or American banks.

Ireland is a tiny blip on the international landscape and therefore we have to give favorable terms to MNC. In terms of a well educated workforce, it is no secret that many MNC have are unhappy with the quality of our workforce. I personally dont think this is a spin. I think we are put to shame by graduates from other EU countries.

ei.sdraob

We are capable of creating own companies.

the problem are various policies pursued by all parties (some less some alot more) in punishing native businesses.

drunkmonkey

Does the original poster or anyone that agreed actually own and run a business, I fear not.

RoastBeefDinner

drunkmonkey wrote: »

Does the original poster or anyone that agreed actually own and run a business, I fear not.

Yep I do, and you know what the multinationals have done nothing to help grow my business. I was involved in technology hardware sales and I can tell you this that they have NO regard to an independent or small business trying to grow in this country.
Intel, Microsoft,Dell and others have all been charged and found guilty with anti-competitive price fixing lawsuits. They are a mafia like no other.

senordingdong

Hardly....we are constantly being told that we need to be more competitive...though only in a way that suits Europe?

gigino

RoastBeefDinner wrote: »

Yep I do, and you know what the multinationals have done nothing to help grow my business. I was involved in technology hardware sales and I can tell you this that they have NO regard to an independent or small business trying to grow in this country.
Intel, Microsoft,Dell and others have all been charged and found guilty with anti-competitive price fixing lawsuits. They are a mafia like no other.

+1.
Intel, microsoft + those can afford to pay a bit more tax here, so we do not need to borrow as much as a country.The countries that are lending us money are fed up with our antics in laundering the profits of their multinationals through transfer pricing, at the expense of their economies.

gbee

A small point on the corp tax, it was intended to be a ten year incentive; history shows that as soon as the incentive period was over, so were the jobs.

During the build up to our current crisis we had firms leaving and a certain M ary H just dismissed them and did nothing to try and persuade them to stay.

She is on record more or less saying she can't be bothered worrying about 3,00 jobs going in an particular industry.

The rote was in full decay and she could not see it. And at the same time as we were losing everything, we had ministers saying we needed massive immigration to fill the jobs. What jobs?

A case of having a slice of cake at Alice's Tea Party. But the Corporation Tax cannot be raised now, world influences may make Ireland attractive once again ~ probably not as good as it had been, but good enough for indigenous support ~ but raise the Tax and our unskilled workforce, shrinking workforce, poorly educated executives, bad roads will all play their part in ensuring that any business goes abroad.

When I was in school Circa 1970 the outlook for Ireland was to be the playground of Europe ~ never really took to that idea and we don't have the weather on a sustainable level ....

Pete_Cavan

I hate when other countries say we have an unfair competitive advantage because of our low corpo tax rate. These same countries have unfair competitive advantages over us in terms of raw materials available, size of domestic market, access to other markets, long established companies, etc.

We should only be willing to give up our competitive advantage if these countries are willing to do the same. Obviously this is not possible so why should we be forced to give up the one thing we have going for us while they keep all their advantages?

Also, these other countries can compete with us in terms of corpo tax if they want. Some European countries dont want to compete on these terms, they want to level the playing field in this regard but will keep their advantages in other areas. However, they do not have these same advantages over every country. These countries should bear in mind that their main competition is not Ireland, it will be emerging economies, if they cant compete with little old Ireland they will be eaten alive by emerging low cost economies.

GCU Flexible Demeanour

Climber wrote: »

We set this low rate to attract foreign companies, presumably because we paddies are incapable of creating our own. This had to be viewed as a sign if failure on behalf of us as a nation. If Europe was a brothel Ireland would be the cheapest whore who is willing to do all the extreme nasty stuff for rock bottom prices! Not something to be proud of, something to be embarrased about.

I think shame is the wrong word, but I do agree that we need to get out of the mindset that sees low corporation tax and FDI as a permanent feature of our economic policy.

And, FWIW, I think you'd also be right to say that there is a conflict between growing our indigenous exporting sector and being a location for FDI, as the indigenous exporting sector will (for the sake of argument) find it hard to compete for skilled staff.

The fact that 90% of our exports are from the FDI sector is a strategic weakness. I think the fact that the strategic management of that FDI sector is (by definition) outside Ireland explains why many can't see beyond the benefits of FDI and appreciate the costs. So, genuinely, they'll say 'sure, what could be wrong with Intel employing lots of people and paying lots of tax in Ireland'?

But, yes, there is a cost as well as a benefit. I just don't think there's much we can do about it immediately - as, at present, we need every export-related job we can get. Low tax is the quick and dirty way of doing that - but it won't make us a living in the longer term, as the tax game is pretty much up.

I think the compromise is for us to agree a changeover period with the EU - say, existing enterprises keeping the low rate for ten years while we mentally adjust to having to work for a living.

jimmycrackcorm

If we are going to be ashamed of our corporation tax then we might as well be ashamed of Ryanairs cheap flights.

We should do something though about the abuse of corporation tax by financial companies and others that book enormous profits through our tax system but employ only a skeleton staff operation. It's pissing off other friendly countries as we are at times little more than a tax haven. The corporate tax rate should be variable depending on the number of employees you have here.

RoastBeefDinner

I just think we need to stop looking at the EU with skepticism. If only our politicians had the balls of some of the leaders of the EU parliament we might actually have a leg to stand on now.

ART6

Pete_Cavan wrote: »

Also, these other countries can compete with us in terms of corpo tax if they want. Some European countries dont want to compete on these terms, they want to level the playing field in this regard but will keep their advantages in other areas. However, they do not have these same advantages over every country. These countries should bear in mind that their main competition is not Ireland, it will be emerging economies, if they cant compete with little old Ireland they will be eaten alive by emerging low cost economies.

Couldn't agree more. And it's not just a matter of taxes. The EU is going to have to wake up to the fact that the endless blizzard of Directives and pointless regulation together with political and public service micro management doesn't assist in competing with emerging economies. Sarkosy needs to grow up (literally) and Merkel needs to shut up:(

Beasty

gbee wrote: »

A small point on the corp tax, it was intended to be a ten year incentive; history shows that as soon as the incentive period was over, so were the jobs.

There is no time limit on the current Corporation Tax regime - The previous regime, which targeted specific investment (eg IFSC), applied for 10 years. The 12.5% rate applies to all trading companies (and a much higher rate, 25%, applies to investment companies), and remains in place until the Government decides to change it

Spudmonkey

RoastBeefDinner wrote: »

Think about it? Where on this earth are they going to find a relatively young educated hungry workforce such as our own? Eastern europe? Asia?

This has to one of the most ignorant opinions I've ever read here. As someone who works in an American multinational I am already seeing a change on the horizon. There is this idea that these places; china, india, eastern Europe (poland?) are strong purely in manufacturing and nothing else. As someone who works closely with engineers in all these countries I can say resolutely that this is not the case. I am working with Indian and Chinese engineers who are technically excellent and would put most of their Irish counterparts to shame. We need to put these inflated opinions we have of ourselves to one side or otherwise we'll be left behind.

RoastBeefDinner

Spudmonkey wrote: »

This has to one of the most ignorant opinions I've ever read here. As someone who works in an American multinational I am already seeing a change on the horizon. There is this idea that these places; china, india, eastern Europe (poland?) are strong purely in manufacturing and nothing else. As someone who works closely with engineers in all these countries I can say resolutely that this is not the case. I am working with Indian and Chinese engineers who are technically excellent and would put most of their Irish counterparts to shame. We need to put these inflated opinions we have of ourselves to one side or otherwise we'll be left behind.

Thought we were discussing the corporation tax here? Or have I miss-read the thread topic?
The intent of the line was to provide encouragement to OUR OWN workers and not eastern europeans or indians for that matter.
Then again it depends on which american multinational you work for..because from my experience ignorance is rife inside them.

Marcusm

Lame Lantern wrote: »

How on earth do you figure that domestic companies don't benefit from low corporation tax? As a matter of fact, home-grown firms grow significantly more rapidly than most true startups of our neighbours as a result, and as has been pointed recently, per capita our corporate tax take is greater than that of Germany and France due to the hitherto robustness in our private sector that our corporate tax regime is in large part responsible for.

Ireland's per capita corporate tax take is undoubtedly not down to "robustness in our private sector" but due in part to the tax planning of MNCs to maximise the benefit of the rate. This takes many forms from the "thick" capitalisation of intragroup finance companies (many f which generate little direct employment) to "assertive" transfer pricing practices which can result in the attribution to Ireland of profits which derive from ephemeral activities. An example is the oft publicised advertising revenue of a large search engine - client management is in local entities which are remunerated on a %age basis equivalent to advertising agencies and the rump income (the bulk) is ultimately lef tin Ireland. In that case, they seemed unhappy to suffer the full 12.5% and managed to pay significant royalties into the Netherlands/Bermuda.

I am not criticising these practices simply trying to ensure that people do not confuse robust corporate tax revenues and high export revenues as signs of a robust MNC economy.

By way of background, I will say that from 1989 I was involved in pitching ireland and the IFSC as a base for IT, software and (predominantly) financial activities. I do now live outside Ireland but have bee involved in creating Irish asse,t owning and financing companies up until 2007.

Spudmonkey

RoastBeefDinner wrote: »

Thought we were discussing the corporation tax here? Or have I miss-read the thread topic?
The intent of the line was to provide encouragement to OUR OWN workers and not eastern europeans or indians for that matter.
Then again it depends on which american multinational you work for..because from my experience ignorance is rife inside them.

And it's not related?

People seem to be under the impression that our superior education system and high quality graduates are the main factors these companies are here when this couldn't be further from the truth. It may have played a part 20 years ago but not any longer. I heard a statistic not so long ago where ~70% of the employees in Google Ireland are non-nationals. Even in the company where I work, new recruitments are having to come from France, Spain, Poland, China etc.

Several companies came out last year with the claims that our education system wasn't up to scratch and wasn't delivering the graduates they needed. Couple that with high business costs and you really have to ask whats keeping them here.

Ignorance may be rife with companies you dealt with but it certainly isn't here.

um7y1h83ge06nx

Only for our corporation tax rate I could very well be on the dole or emigrating.

I used work for an American company and now I work for a British one. My brother works for a British company.

I don't see what is so bad about foreign companies. Of course I do believe we should strongly support homegrown companies.

We have lots of Irish success stories but they prefer to operate under the radar.

Two stories I am proud of are Timoney Technologies and Havok:

http://www.timoneygroup.com/

http://www.havok.com/

RoastBeefDinner

Spudmonkey wrote: »

And it's not related?

People seem to be under the impression that our superior education system and high quality graduates are the main factors these companies are here when this couldn't be further from the truth. It may have played a part 20 years ago but not any longer. I heard a statistic not so long ago where ~70% of the employees in Google Ireland are non-nationals. Even in the company where I work, new recruitments are having to come from France, Spain, Poland, China etc.

Several companies came out last year with the claims that our education system wasn't up to scratch and wasn't delivering the graduates they needed. Couple that with high business costs and you really have to ask whats keeping them here.

Ignorance may be rife with companies you dealt with but it certainly isn't here.

Firstly, you mis-quoted my original post and forgot the sarcastic eyes hence my need to defend it.

Secondly I do not believe for one second we are not producing enough graduates. There is an inherent SHORTFALL of IT professionals worldwide. It has been since 1999 and it will continue to be so. Also in the past 4 or 5 years Computer Science degree courses are not first choice anymore because of the fact you could be answering phone calls with a science degree. Most of the Irish have copped onto that by now. Hence you see the influx of other europeans into Ireland. AND by all means I support it but dont under-estimate the irish knowledge and experience.

Thirdly, our income tax has shot up since the beginning of the year and get ready for some more come next budget. So why continue with the low CORP tax? Do you really think multinationals will cut and run if you add a couple of percent?


here's a link with a more educated view than mine on corp tax

http://www.finfacts.ie/irishfinancenews/article_1021086.shtml

jmayo

gigino wrote: »

+1.
Intel, microsoft + those can afford to pay a bit more tax here, so we do not need to borrow as much as a country.The countries that are lending us money are fed up with our antics in laundering the profits of their multinationals through transfer pricing, at the expense of their economies.

Yes they could afford to pay a bit more, but will they ?
No, why should they if they can get a better deal elsewhere.

RoastBeefDinner wrote: »

I just think we need to stop looking at the EU with skepticism. If only our politicians had the balls of some of the leaders of the EU parliament we might actually have a leg to stand on now.

Are you working for EU by any chance ?
EU parliament is an unnecessary talking shop with little postive relevance to the lives of most EU citizens.
And for the life of me I don't what leaders of the EU parliament you refer to when you talk of balls ?

RoastBeefDinner wrote: »

Firstly, you mis-quoted my original post and forgot the sarcastic eyes hence my need to defend it.

Secondly I do not believe for one second we are not producing enough graduates. There is an inherent SHORTFALL of IT professionals worldwide. It has been since 1999 and it will continue to be so. Also in the past 4 or 5 years Computer Science degree courses are not first choice anymore because of the fact you could be answering phone calls with a science degree. Most of the Irish have copped onto that by now. Hence you see the influx of other europeans into Ireland. AND by all means I support it but dont under-estimate the irish knowledge and experience.

Has it ever dawned on you the reason foreigners are employed in these positions is because we have cr** language skills ?

There is a difference between quantity and quality.
Stop talking up our graduates, they are often cr** and every Tom, Dick and Harry now appears to have a "degree".

RoastBeefDinner wrote: »

Thirdly, our income tax has shot up since the beginning of the year and get ready for some more come next budget. So why continue with the low CORP tax? Do you really think multinationals will cut and run if you add a couple of percent?

YES, they damm well will.
Why would Hollister continue to invest and employ people in Ballina, a little town at the end of a crap road and crap railway link on the peripherary of this unconnected island, which is on the peripherary of European mainland ?

When they expanded recently they gave the tax rate as being a very important motivator for such a decision and you reckon we should up it. :rolleyes:

EoghanConway

It's a pity we need to rely on the blanket low rate to attract business to the country and more importantly, keep it. Raising the rate even a little would prompt every foreign business to examine the cost to benefit of doing business in Ireland and truthfully many would pick up and leave.

RoastBeefDinner

Yes they could afford to pay a bit more, but will they ?[/B]
No, why should they if they can get a better deal elsewhere.

This is not about shopping around lidl,aldi and tesco for a "better deal".

Are you working for EU by any chance ?
EU parliament is an unnecessary talking shop with little postive relevance to the lives of most EU citizens.
And for the life of me I don't what leaders of the EU parliament you refer to when you talk of balls ?

Another euro skeptic:rolleyes:
Berlusconi aside:D if I'm not mistaken the subject of corp tax is part of a wider discussion leading towards the harmonisation of tax laws.
Why do so many look to the EU parliament as the enemy?
Greed is your enemy!

Has it ever dawned on you the reason foreigners are employed in these positions is because we have cr** language skills ?

There is a difference between quantity and quality.
Stop talking up our graduates, they are often cr** and every Tom, Dick and Harry now appears to have a "degree".

I have trouble understanding mayoish anyway, so I can understand your frustration if you cant get your head around other languages. As for our graduates well that really does depend which part of the country you come from because where I live we are well above the national average.


YES, they damm well will.
Why would Hollister continue to invest and employ people in Ballina, a little town at the end of a crap road and crap railway link on the peripherary of this unconnected island, which is on the peripherary of European mainland ?

When they expanded recently they gave the tax rate as being a very important motivator for such a decision and you reckon we should up it. :rolleyes:

So you didnt get any money from the EU fund for road development? Ahh. Maybe you should have voted for a better political representative or perhaps thought your current TD how to lick arse and get what the area needed!

um7y1h83ge06nx

RoastBeefDinner wrote: »

This is not about shopping around lidl,aldi and tesco for a "better deal".

But it is isn't it? A business should always be trying to supply a quality product or service with the lowest cost to themselves as possible.

Whether that is by sourcing cheaper raw materials of comparable quality or hiring cheaper staff of comparable quality, they'll achieve the same aims at the end of the day.

uteotw

The problem isn't really the 12.5% rate, the problem is in fact the loophole that allows the money to leave Ireland without being taxed, and then leave the EU without being taxed either.

It's called the 'Double Irish Dutch Sandwich' and has been mentioned many times.

http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html

later12

uteotw wrote: »

The problem isn't really the 12.5% rate, the problem is in fact the loophole that allows the money to leave Ireland without being taxed, and then leave the EU without being taxed either.

It's called the 'Double Irish Dutch Sandwich' and has been mentioned many times.

http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html

This has been covered elsewhere. Google would have presented about 6 billion for taxation to Ireland when it should have presented only about 125 million. We are net benefactors by miles under the arrangement. The money that was sent abroad was never raised here and was never ours yet the exchequer still benefits to the tune of literally hundreds of millions from one company alone.

Amhran Nua

The only mistake we've made with the corporate tax rate is assuming it was the final destination. It's just a stepping stone, and needs to be recognised as such. If the government over the last ten years had focused on domestic industry instead of property, we'd be in a vastly better place by now.

two wheels good

later10 wrote: »

Google would have presented about 6 billion for taxation to Ireland when it should have presented only about 125 million. We are net benefactors by miles under the arrangement. The money that was sent abroad was never raised here and was never ours yet the exchequer still benefits to the tune of literally hundreds of millions from one company alone.

Really? Hundreds of millions of Euro? Can you back that up with some sources? My reading of the topic suggests that Google uses Holland and Bermuda to avoid taxes in Ireland too.
This link states Google paid €18.3m in Ireland in 2009 on $12.5 BILLION earned outside the USA.

Maybe some people are happy to turn a blind eye to the injustice of the situation just because Ireland is gaining advantage. Why shouldn't taxes be paid where the profits are earned?

I see a situation where the wealthiest and most influential corporation in the world aren't paying their fair share (along with undermining democracy, helping corrupt politicians, polluting the planet, oppressing minorities but that a tale for another day)

If you'd like to see how it feels from the point of view of the people who are producing the profits and yet denied a fair tax share of them consider this BBC Radio4 File on Four report.
http://www.bbc.co.uk/programmes/b00vhgpl

Large corporations with no assets and few if any staff sheltering behind a company registration at a PO box number in Dublin or Zug, Switzerland to avoid taxes in the country where the income is earned. For example: Cadbury's using Irish subsidiaries to avoid tax on UK profits; Kraft moving Cadbury's company registration to Switzerland to avoid taxes; Alliance Boots registered in Zug at a PO box (with no staff) and the British exchequer losing ~£100m in tax. Teams of accountants in Canary Wharf seeking loop holes and "double-dipping" tax dodges. It stinks - and you seem to think we (Irish) should be grateful.

I don't like tax loopholes or tax havens - wherever they exist around the globe. Whatever your view on the level of Corp. Tax this type of scam is deplorable.

later12

two wheels good wrote: »

Really? Hundreds of millions of Euro? Can you back that up with some sources? My reading of the topic suggests that Google uses Holland and Bermuda to avoid taxes in Ireland too.

Yes it does, but I don't know where the author got the 18 million euro figure from.

If Google credits Ireland with 88% of its $12.5 billion sales that credits Ireland with $11 billion in sales. It transfers $5.4 billion in royalties to Bermuda via the Netherlands, which leaves $5.6 billion in Dublin. This equals approximately €4 billion in Dublin at today's exchange rate. If that were all taxed at the Irish rate of 12.5%, then Google would indeed be paying €500m, or thereabouts in crude terms, in corporate tax.

So it isn't clear where the author is suggesting the money goes after the funds destines for Holland and Bermuda are accounted for, or how s/he came up with a figure of just €18 million.

It is also worth noting, that if the figures on the link were to be correct, at €18million in corporate tax, google are still paying more tax in Ireland proporational to what was earned here if, as the article says, less than €125m was earned directly in Ireland. So we would still be net benefactors, even with €18m tax. We certainly wouldn't be losing tax. Furthermore, about 2,000 people work for Google in dublin and it's worth bearing in mind that this situation alone could make the corporate rate justifiable leaving aside, or as neutral, the money we make on their corporate tax.

two wheels good

later10 wrote: »

.......... then Google would indeed be paying €500m, or thereabouts in crude terms, in corporate tax.

As I say, I'd love to see some reliable sources about what corp taxes Google pay in Ireland. You're maths may be accurate but....

I made a few searches (using a well-known search engine) but didn't locate the company accounts.

I did find *many* articles about Google's (perfectly legal) tax evasion. For example:
1. in the US
"Finally, Google’s income tax expense on the hefty presumptive foreign source income amounted to $29, $51 and $71 million, which represented 3.1, 3.5 and 4.2 percent over the three years respectively."

2. In the UK
"Outside of its US operations, the UK market is the biggest revenue earner for Google, yet the company doesn't pay any taxes whatsoever in the country."

Do you think this is just - which is my wider point?
(Believe me, I'm very grateful for the jobs they provide in Ireland.)

later12

two wheels good wrote: »

Do you think this is just - which is my wider point?

I don't think I have ever looked at a profit line of the company I worked for, or at their taxes, or at my own personal savings and asked 'but is it just?'. Justice doesn't come into it. It isn't the job of Google or any other corporation to mete out justice, it is the role of lawmakers. Google's loyalty ought to be to its shareholders, its customers and its employees, and probably in that order. If they can creatively lower their tax contribution they should do it.

Like i said, Ireland has only gained from their tax policy, and perhaps it is my obdurate capitalist beliefs but I really don't care if their policy is fair or not.

two wheels good

later10 wrote: »

It isn't the job of Google or any other corporation to mete out justice, it is the role of lawmakers. Google's loyalty ought to be to its shareholders, its customers and its employees, and probably in that order. If they can creatively lower their tax contribution they should do it.

Like i said, Ireland has only gained from their tax policy, and perhaps it is my obdurate capitalist beliefs but I really don't care if their policy is fair or not.

I agree entirely that it's not Google's or any other large corp. to decide the tax rate. Of course its duty is to it's shareholders. (BTW I would hope that its employees rank higher than its customer in your hierarchy of loyalties.)

The justice and ethics of the corp tax rate is for us and our government to decide.

In the absence of any sources to support your claim that:
"...the [Irish] exchequer still benefits to the tune of literally hundreds of millions from one company [i.e Google] alone." I can only judge that it is completely baseless. I refer you my referenced figure of ~€18m until I can find further information.

Also, in the light of recent events and the evidence of 40 years of Reganomics, Thatcherism, Friedman, turbo capitalism, neo-cons, "light touch self-regulation", bank crisis after bank crisis, bubble after burst bubble, and now corporate welfare privatise the profits - socialise the losses for the banks, I urge you to reconsider your "obdurate capitalist beliefs". Because there has to be a better way.

Amhran Nua

two wheels good wrote: »

The justice and ethics of the corp tax rate is for us and our government to decide.

I think the two thousand people being employed by Google might have a fairly vigorous opinion on the matter as well.

two wheels good wrote: »

In the absence of any sources to support your claim that:
"...the [Irish] exchequer still benefits to the tune of literally hundreds of millions from one company [i.e Google] alone." I can only judge that it is completely baseless. I refer you my referenced figure of ~€18m until I can find further information.

At an absolute minimum they are paying indirectly for the income tax of their employees, and if you work for Google you're probably on above average industrial wage, as well as the employer's contribution and related charges like commercial rates, so I'd say at least €60 million a year. That's 6000 people on social welfare paid for right there. Then you get to the fact that a high profile company like Google will attract other companies here, not to mention that when their employees spend money they keep other people in employment.

Contrast this with moralising from the likes of France, who have run a deficit for the last 35 years and are far from a high corporate tax area themselves, Italy with Berlusconi among many other issues, Spain with greater than 20% unemployment, and Germany who subsidise their coal industry to the tune of billions.

Moralising over the corporate tax rate falls a bit flat when you see who is doing the complaining.

mrgaa1

EoghanConway wrote: »

It's a pity we need to rely on the blanket low rate to attract business to the country and more importantly, keep it. Raising the rate even a little would prompt every foreign business to examine the cost to benefit of doing business in Ireland and truthfully many would pick up and leave.

But would they leave? Do a lot of these companies not channel all or part of their global funds through Ireland for the very corporation tax that we are talking about? I wonder is there a list somewhere that shows which companies do this and which don't.

RichardAnd

two wheels good wrote: »

I agree entirely that it's not Google's or any other large corp. to decide the tax rate. Of course its duty is to it's shareholders. (BTW I would hope that its employees rank higher than its customer in your hierarchy of loyalties.)

The justice and ethics of the corp tax rate is for us and our government to decide.

In the absence of any sources to support your claim that:
"...the [Irish] exchequer still benefits to the tune of literally hundreds of millions from one company [i.e Google] alone." I can only judge that it is completely baseless. I refer you my referenced figure of ~€18m until I can find further information.

Also, in the light of recent events and the evidence of 40 years of Reganomics, Thatcherism, Friedman, turbo capitalism, neo-cons, "light touch self-regulation", bank crisis after bank crisis, bubble after burst bubble, and now corporate welfare privatise the profits - socialise the losses for the banks, I urge you to reconsider your "obdurate capitalist beliefs". Because there has to be a better way.

Socialisation of private debt, or to put it better, bailing out the banks, was not a capitalist move. If the "rules" of capitolism had been followed, then the banks would have been left to sink as capitalism means that poor choices and bad decisions bring failure, a failure that is not the responcibility of others to clean up.

Socialism is what has this country up the sticks. It is socialism that has breed us with a culture of entitlement, a lazy work ethic and all the other little Irish quirks that add to our mess. In a capitalist envoirment, the rules are more natural; the strong and wise survive, the weak fail and that is the fundemental rule of nature.

Fratton Fred

Einhard wrote: »

"Extremely nasty stuff"? Eh, what exactly do you think goes on in the multi-nationals? Microsoft et al do the exact same thing in Ireland as they do in France- the only difference is we charge them less for the pleasure. Nothing wrong with that. I presume you picket Lidl and Aldi also? After all, they have lower rates to attract customers too. Filthy bastards.

But they don't though. The above companies earn billions in revenue around Europe and channel it all through Ireland to avoid paying tax.

As has been pointed out earlier, Google's biggest market outside of the US is the UK, yet they pay no tax there.

You know how pissed off people get about Bono not paying tax here, well multiply that a thousand times and you will get an idea of how pissed off Europe is about Ireland.

keithclancy

The Main Issue is that Ireland is used to funnel money into/out of the EU.

A low corporate tax rate is not directly proportionate to Jobs.

Before the Financial crisis Ireland never contributed funds to the EU and is now a recipient of even more funds than before (if you include the bailout)

All of those Roads etc under the NDP that was partly funded by the EU were partly paid for by EU money.

So either I see it as:

A. Ireland keeps it Corporate Tax rate but no longer recieves EU funds, which means a drop in funds for Infrastructure maintenence, which IMO is in a poor state as it is

or

B. Ireland Increases its Corporate Tax rate while directly investing into infrastructure and continues to recieve funds via the EU i.e. by keeping our fellow Europeans happy.

You have to remember that the politicians are only stating what the people feel, in Germany there is alot of disdain for Ireland and Greece recieving the bailouts which will come out of the German Tax payers pocket and then Ireland is expecting to still recieve all of the benefits that come from the EU that is mainly paid for by the French and the Germans.

Companies in Ireland use Ireland to sell products. All of the Large Multinationals are outsourcing services to places such as Brunei, Chennai, Bangaluru, Kuala Lumpur etc.

You do not need to locate your staff in Ireland to avail of the low corpo tax rate.

So really when other EU Member states say that Ireland should raise its Corporate tax rate, they really mean that Ireland should pay for itself, every cent that the EU pays into Ireland is seen as money that Ireland could pay itself. which is another potential job lost in Germany/France.

um7y1h83ge06nx

Why are people so concerned about other countries?

No point in being all goody two shoes to other European countries if we're left in poverty.

keithclancy

Colin Rhythmic Bicyclist wrote: »

Why are people so concerned about other countries?

No point in being all goody two shoes to other European countries if we're left in poverty.

Thats a strange stance to take when being in the European Union

um7y1h83ge06nx

It might seem strange to some alright.

I support the EU but I also believe in priorities.

So I reckon Ireland > European Union.

Fratton Fred

Colin Rhythmic Bicyclist wrote: »

Why are people so concerned about other countries?

No point in being all goody two shoes to other European countries if we're left in poverty.

Are you German? Because that is exactly what they are saying at the moment, along with the Brits, The French, the Danish.....

two wheels good

I don't want to drag the topic away from the corp tax rate but this demands an answer:

RichardAnd wrote: »

Socialisation of private debt, or to put it better, bailing out the banks, was not a capitalist move. If the "rules" of capitolism had been followed, then the banks would have been left to sink...

Good point! Corporate Welfare, and I don't mean just for the banks - the perfect example of why turbo capitalism has morphed into a monster. How corporations have too much power and influence over goverments.

RichardAnd wrote: »

Socialism is what has this country up the sticks. It is socialism that has breed us with a culture of entitlement, a lazy work ethic and all the other little Irish quirks that add to our mess. In a capitalist envoirment, the rules are more natural; the strong and wise survive, the weak fail and that is the fundemental rule of nature.

Socialism has brought the country to its knees?
I suppose it was the core Socialist priciples of cronyism, rampant bankers, greedy develops, incompetent civil servants etc. that screwed us? Either your understanding of the cause of the crisis or the definition Socialism is out of whack I'd say.

Socialist! The knee-jerk accusation of every blinkered free-marketeer when faced with the suggestion that unfettered capitalism needs to be reigned in. Note: I never proposed Socialism - or even mentioned it.

Here's a point for you to consider - an interesting analysis I read a few years ago.
Over a lengthy period spanning the 80s and 90s Sweden's economy outperformed the UK's every year except for two years. This was during a time when UK politicians where insisting that the economy had to be low tax, flexibile labour laws, with light-touch regulation.

RichardAnd wrote: »

In a capitalist envoirment, the rules are more natural; the strong and wise survive, the weak fail and that is the fundemental rule of nature.

I want to live in a society where weak and vulnerable people are cared for. Not considered like some injured wilderbeast on the serengetti. And the country can afford such "luxuries" if CORPORATIONS PAY A FAIR TAX ON THEIR LARGE PROFITS

Which brings me nicely back on topic. I bid you all good night.