can we not actually lower the 12.5% corporation tax?

lightspeed

Hi after watching the 9 o clock news tonight it mentioned how many investors in the USA in particular are having a lot of doubt about investing in Ireland due to the uncertainty of the corporation tax rate of 12.5% remaining unchanged. Considering the high interest rate that Ireland is being forced to pay in the IMF deal it would seem that its not a coincidence that they are looking for a reduction in the corporation tax. it seems that the only reason the rate for the IMF deal is so high is so that they can blackmail Ireland to force us to lower the corporation tax and they were probably hoping that fianna fail would still be in power and follow the norm of appeasement to the demands of the ECB as long as there was a smoke screen to attribute the reduction as a matter of necessity such as it would be easier to be swallowed by the Irish people just stamping their feet and forgetting all about it while fianna fail would be able to say there hands were tied so they had to reduce the corporation tax to get the lower interest rate on the imf deal and try their best to spin as the best of a bad situation. It is suspicious to say the least the way just about 3 months ago it was completely set in stone and not negotiable and now they are talking in negotiations. As if the idea of a lower interest rate in an exchangefor a lower corporation tax is just something that Sarkozy and his friends thought up since we done the IMF deal only last December. I cant possibly believe that and i think that the primary reason for the high interest rate right from the start was just to get Ireland to lower it corporation tax. So my question is if Ireland is an independent country like we are being told and were reminded of as we signed the Lisbon treaty why cant we actually lower the corporation tax if they refuse to lower the IMF interest rate? Cant we say we want the rate reduced reduced by as much as 2% or else we will immediately lower the corporation tax by at least 2% or more?

andrew

Moved to Irish Economy

iMax

An excellent idea, but it would hurt us financially long term (even short term), nothing stopping us threatening though.

Maybe we should have a sliding scale in terms of size of business - smaller pay 12.5 & go down .5% at various thresholds of employment.

ei.sdraob

That is what I mentioned in several other threads

planting a seed of doubt about our rate is as powerful as lowering it

now will the new government for gods sake make it loud and clear that this will never be changed? and keep repeating it.

RichardAnd

ei.sdraob wrote: »

That is what I mentioned in several other threads

planting a seed of doubt about our rate is as powerful as lowering it

now will the new government for gods sake make it loud and clear that this will never be changed? and keep repeating it.

My thoughts exactly and even a slight increase in the rate would only confirm that the rate is not set in stone. No, FG and Labour need to set a clear message that the CT rate isn't going up.

raymann

ei.sdraob wrote: »

That is what I mentioned in several other threads

planting a seed of doubt about our rate is as powerful as lowering it

now will the new government for gods sake make it loud and clear that this will never be changed? and keep repeating it.

my worry is that the forces that are at work have a grand goal in mind. it appears that our taxation rates are worryingly high on their agenda.

these are powerful people with goals that i cant quite understand and they appear to be focussing on this issue.

i hope the choice is still truly in our own hands.

MonkieSocks

Our low Corporation Tax is one of the assets that this country has that has an ongoing benifit
to the Irish Economy.

It must be kept to entice further investment.

We have seen how many companies have upped and went to eastern Europe in the last few years and should do everything to protect what assets we have left.



Good read here on Taxes across the world

http://www.taxrates.cc/

Max Power1

Its a simple issue lads.

If we up the CT rate at the behest of EU/IMF requests, then it sends out the message that its not set in stone.

If we even up it by .5 percentage points, we can all stand back and watch the flight of the FDI industries and companies out of ireland to eastern europe. (Some of whom like bulgaria AFAIR have a CT rate of 10%).

Cookie_Monster

It's already 10% for manufacturing (as of last year anyway, not sure if this years still).

Lowering it any more will risk us being designated a tax haven, the US are considering it anyway. If this happens say good bye to the US multinationals as their legislation means they can't funnel profits through us.

There are also huge R&D credits and "discounts" of the CT as well as all sorts of other deductions, there would be very few companies that pay anywhere near the 12.5% on all their profits anyway.

lightspeed

I think that if we introduced a corporation tax rate of 10.5% for start up companys that readjusted to the 12.5% rate after say 3 or 4 years. We could at least use this as a bargain tool for at the moment

iMax

lightspeed wrote: »

I think that if we introduced a corporation tax rate of 10.5% for start up companys that readjusted to the 12.5% rate after say 3 or 4 years. We could at least use this as a bargain tool for at the moment

Right now there's no corporation tax payable for the first two (possibly three) years of a startup company

ei.sdraob

iMax wrote: »

Right now there's no corporation tax payable for the first two (possibly three) years of a startup company

up to turnover of 120K or so

CBBB

Firstly, the main leaders of the EU want all countries within the Euro zone to align their tax bands and rates, from VAT, to personal taxation to corporation tax. The current situation does not suit a single currency zone. Thats their main aim! Not to punish Ireland! We could lower our corporation tax if we wanted to, but I doubt we would lower it any more, we're already seen as a 'tax free zone' as it is for multi nationals, why lose out on an additional 2% income? i saw the news item you mention last night too, those Americans where only trying to push their muscle about.

As for countries moving to Eastern Europe, corruption, both government, and black market (mafia), theft/shrinkage does not make the move from Ireland to Eastern Europe as appealing as it once was. Give it 50 years, maybe less, and our wage demands will be near equal, big business is thinking twice about long term investment in these countries. The initial rush seems to be over.

We still have a lot to offer, a well educated, English speaking, Euro zone country in Europe, with (despite the last government) very little levels of corruption and cronyism. We should be pushing that and not bowing to the Americans every time they ask.


http://www.newsgrape.com/a/corruption-in-eastern-europe/

ei.sdraob

CBBB wrote: »

We still have a lot to offer, a well educated, English speaking, Euro zone country in Europe, with (despite the last government) very little levels of corruption and cronyism.

stop flogging a dead horse

CBBB wrote: »

with (despite the last government) very little levels of corruption and cronyism.

you owe me a new keyboard, my coffee spilled :rolleyes:

Max Power1

ei.sdraob wrote: »

stop flogging a dead horse




you owe me a new keyboard, my coffee spilled :rolleyes:

+1

I dont know what country he's talking about but it's certainly not here.

lightspeed

well to be fair economic manslaughter and gross incompetence are not quite the same as corruption and world rankings show Ireland at 14th place just one above Germany and 6 place above the UK so in comparison to particularly eastern European countries where the perception is that they are more corrupt. (yes im aware not everything on wikipedia is 100% but its usually accurate)
http://en.wikipedia.org/wiki/Corruption_Perceptions_Index
And if you watched the same news piece as i did im sure you seen them mention that investors were worried about Ireland's corporation tax and were looking at countries like Switzerland and Singapore so its not like eastern Europe are our main or at least only competitors.
I was not aware that no corporation tax at all was paid in the first few years of starting a company guess we cant play that card. But still why cant we threaten to lower corporation tax to force them to give us a lower rate? Yes we may lose 2% on tax collected but if it encouraged more multinationals to expanded and start up in Ireland then wouldn't it make sense? i admit it may be a gamble but its less of a gamble than the IMF deal as it stands at the moment as many economists say its just not going to be possible for Ireland to be able to pay back the imf loan at the current rate. Its funny that with the Lisbon treaty we were apparently all more closer European neighbours and unified but now those same friendly neighbors are challenging us to an economic war.

lopppy

There's no need to bluff lowering our corporation tax, Ireland is in the unique position of having the potential to damage the entire financial stability of the Eurozone, through threatening to default.

We need to show Merkel and the rest that unless we get a significant lowering in the interest rate we wont be able to pay back any of the debt we owe them and bondholders too.

uglyjohn

i really dont see why this is always such an issue. all countries have higher taxes in other areas and lower in, its down to how the goverment wants to make up its tax base. over time all these factors combine to show the market the cost to employ someone and operate in an country. for example higher vat and road taxes etc increases the cost of living so employees have to be paid more and so on.