Ryanair pulling out of Ireland

Valhallapt · 22-03-2021 2:17pm #1

Following up on some of their earlier threats like here https://www.thestory.ie/2019/02/17/ryanair-warned-government-it-might-have-to-move-operations-out-of-ireland-because-of-double-taxation-of-air-crew/ and the latest article in thecurrency.news https://thecurrency.news/articles/40164/flight-risk-how-ryanair-is-migrating-its-irish-business-to-malta-and-poland-and-why-it-is-doing-it/ which I can’t copy here, it looks like Ryanair are doing exactly what they said they would do, they have now reflagged 1/3 of their aircraft to Malta and Poland, and it seems pace is picking up, they will have less than half their fleet wearing a tricolour by the summer.

Development centres in Poland and Barcelona now have more staff than are based in Swords.

The split of Ryanair Group in Malta air, buzz etc is more than just a management reshuffle, big hitters like David OBrien going to Air Malta (now one of Europe’s biggest airlines) are there to move the majority of the fleet out of Ireland.

It’s such short term thinking form the government, Paschal Donoghue was warned about this, and wrongly thought it was an idle threat, a lot of jobs will be lost downstream because of this.

Noxegon · 22-03-2021 2:24pm

I'd love to read the article you've linked to, but I am not prepared to take out an automatic renewing subscription for the privilege of doing so.

Valhallapt · 22-03-2021 2:28pm

Noxegon wrote: »

I'd love to read the article you've linked to, but I am not prepared to take out an automatic renewing subscription for the privilege of doing so.

I’d like to paste it here, but doubt that’s allowed

Jack1985 · 22-03-2021 2:34pm

Alaninwondeand wrote: »

The Government will always have free business class flights from Aer Lingus so they don't care much for Ryanair.

They do in their eye; they pay the fare available at time of booking same as everyone else. Leo was planted next to a lard arse American to Brussels before who thought he was a celebrity.

Alaninwondeand · 22-03-2021 2:49pm

Jack1985 wrote: »

They do in their eye; they pay the fare available at time of booking same as everyone else. Leo was planted next to a lard arse American to Brussels before who thought he was a celebrity.

"They" you mean us, the tax payer.

skallywag · 22-03-2021 2:51pm

Alaninwondeand wrote: »

"They" you mean us, the tax payer.

Who do you think should pay in such circumstances?

Nijmegen · 22-03-2021 3:37pm

The Currency produces some great original journalism that's well worth paying for if you're into that sort of thing. I won't re-post items verbatim here, but broadly what they're saying is there has been a steady trickle of Irish flagged Ryanair frames to subsidiaries in Poland, Malta etc. Links it to the March 2018 story about preparation for budget 2019 and the tax treatment of workers with operational bases across Europe. The anomaly is costing Ryanair €35m per year, according to their own letter to the Dept Finance. (Side note: I'm not sure €35m a year is the sole reason they're re-basing. Other pay and conditions and general corporate structure is going to be in play - and there's a lot of action between unions, ryanair and pilots over what it all really means - e.g., in Poland now a lot of the pilots are back to the old "self employed" game. 27% of Ryanair's pilots are self employed according to the piece, making up the majority of the 10% of European pilots overall who are self employed).

There was a DoF letter to the minister that said "ah sure airlines have a load of other considerations and would be slow to do this", and Ryanair went to the High Court. Tho the article points out they had already started the process of breaking up their aircraft under various AOCs beforehand, so it's difficult to say how much is something they were going to do anyway, how much is an acceleration of things they were doing, and how much they wouldn't have done without the rule change. Wouldn't be like some corporates to blame something they're going to do anyway on something else that happens incidentally.

In the 19 months to end 2020, Ryanair's Irish fleet dropped from 451 to 273, with a major acceleration between October 2019 and May 2020. The 737s rolling off the line for Ryanair are in the colours of Buzz and Malta Air.

I think a particular passage in the piece is on the money: Ryanair hasn't moved its HQ out of Ireland would be unlikely perhaps to do so (there's too much static back office function here that works at scale) - but it is breaking up a lot of the elements of its business and sticking them into jurisdictions most favorable to its business, with partial blame on the Irish government for not seeing the danger and accommodating Ryanair. That being said, as I say above, some of the changes go beyond the PAYE cost and I would say they are likely to have occurred in any event (and some were occurring before the budget for 2019 when this supposedly all kicked off).

Tenger · 22-03-2021 3:40pm

My understanding is that this reflagging of parts of the FR fleet has been in the works for a couple of years.
Don't confuse public threats over the last 12 months with a strategic longterm plan.
I actually saw B737MAXs in Buzz livery in a photo from January 2020 in Seattle

In addition, moving aircraft out of Ireland doesn't mean they will no longer serve Ireland.

Edit: obviously I'm not a time traveller from 2030

Noxegon · 22-03-2021 4:20pm

Tenger wrote: »

I actually saw B737MAXs in Buzz livery in a photo from January 2030 in Seattle.

Can I borrow your DeLorean? I'd like to get my COVID vaccine.

Valhallapt · 22-03-2021 4:24pm

Nijmegen wrote: »

The Currency produces some great original journalism that's well worth paying for if you're into that sort of thing. I won't re-post items verbatim here, but broadly what they're saying is there has been a steady trickle of Irish flagged Ryanair frames to subsidiaries in Poland, Malta etc. Links it to the March 2018 story about preparation for budget 2019 and the tax treatment of workers with operational bases across Europe. The anomaly is costing Ryanair €35m per year, according to their own letter to the Dept Finance. (Side note: I'm not sure €35m a year is the sole reason they're re-basing. Other pay and conditions and general corporate structure is going to be in play - and there's a lot of action between unions, ryanair and pilots over what it all really means - e.g., in Poland now a lot of the pilots are back to the old "self employed" game. 27% of Ryanair's pilots are self employed according to the piece, making up the majority of the 10% of European pilots overall who are self employed).

There was a DoF letter to the minister that said "ah sure airlines have a load of other considerations and would be slow to do this", and Ryanair went to the High Court. Tho the article points out they had already started the process of breaking up their aircraft under various AOCs beforehand, so it's difficult to say how much is something they were going to do anyway, how much is an acceleration of things they were doing, and how much they wouldn't have done without the rule change. Wouldn't be like some corporates to blame something they're going to do anyway on something else that happens incidentally.

In the 19 months to end 2020, Ryanair's Irish fleet dropped from 451 to 273, with a major acceleration between October 2019 and May 2020. The 737s rolling off the line for Ryanair are in the colours of Buzz and Malta Air.

I think a particular passage in the piece is on the money: Ryanair hasn't moved its HQ out of Ireland would be unlikely perhaps to do so (there's too much static back office function here that works at scale) - but it is breaking up a lot of the elements of its business and sticking them into jurisdictions most favorable to its business, with partial blame on the Irish government for not seeing the danger and accommodating Ryanair. That being said, as I say above, some of the changes go beyond the PAYE cost and I would say they are likely to have occurred in any event (and some were occurring before the budget for 2019 when this supposedly all kicked off).

Thanks this is a good summary, but I don't agree about the HQ not moving.

The Maltese government are clearly designing a tax structure to help the aviation industry, in 2018 Ryanair had an effective tax rate of somewhere over 10%, this fell down to 3.2% in 2020 (some of this is due to losses etc, so hard to gauge)

I can see a complex web of HoldCo structures with more backend jobs moving to Malta to obfuscate where its actual HQ is. This move will result in a loss of Corporate Taxes, Aircraft registration taxes, PAYE and all the down stream supplier jobs the have co located around the Ryanair HQ.

I don't think they will reduce capacity out of Dublin, but many of those aircraft will be operated from bases elsewhere, and Dublin airport will loose out of overnight parking fees and ramp jobs etc

Shannon, Cork and Kerry may never return as a base.

Nijmegen · 22-03-2021 6:24pm

Valhallapt wrote: »

Thanks this is a good summary, but I don't agree about the HQ not moving.

The Maltese government are clearly designing a tax structure to help the aviation industry, in 2018 Ryanair had an effective tax rate of somewhere over 10%, this fell down to 3.2% in 2020 (some of this is due to losses etc, so hard to gauge)

I can see a complex web of HoldCo structures with more backend jobs moving to Malta to obfuscate where its actual HQ is. This move will result in a loss of Corporate Taxes, Aircraft registration taxes, PAYE and all the down stream supplier jobs the have co located around the Ryanair HQ.

I don't think they will reduce capacity out of Dublin, but many of those aircraft will be operated from bases elsewhere, and Dublin airport will loose out of overnight parking fees and ramp jobs etc

Shannon, Cork and Kerry may never return as a base.

I think the HQ is difficult to move. It'd be hard for them to move in on paper because they have so much substance in Dublin. And that substance is created by real people doing real work - route planning, marketing, etc etc etc. To properly move the HQ in this era of corporate tax rules would require moving those people or their roles, without interruption to the core business. That's very difficult versus bases for aircraft, which are portable by nature.

I'm not sure what the rules are around place of supply for an airline where judging corporate taxes is concerned, but I'd say that by simply basing the aircraft abroad and under a different AOC a slice of their corporate tax bill will come down anyway; they're reducing the cost of the workforce both by eliminating the tax problem on PAYE and possibly through the contracts and conditions they can offer outside Ireland... So a good day's work. Moving the whole actual HQ to Malta, 500,000 people in size in terms of existing pop (i.e., you need staff and their knowhow to move there) is a different deal I suspect.

And to the point about Ryanair servicing Ireland, I think some readers confuse "pulling out" with "not flying to".

California Dreamer · 23-03-2021 9:11am

On the broad scale of things does Gary and his mates or Tracey and the girls going off for a weekend really care what country the aircraft is registered in apart from getting a cheap fare?

Nijmegen · 23-03-2021 9:43am

California Dreamer wrote: »

On the broad scale of things does Gary and his mates or Tracey and the girls going off for a weekend really care what country the aircraft is registered in apart from getting a cheap fare?

It’s a question for Ireland Inc more so than punters, and the Irish AV community. Where aircraft are based has a material effect on livelihoods.

California Dreamer · 23-03-2021 10:23am

Nijmegen wrote: »

It’s a question for Ireland Inc more so than punters, and the Irish AV community. Where aircraft are based has a material effect on livelihoods.

For the purpose of education, could you expand on the material effect on livelihoods?

Valhallapt · 23-03-2021 10:24am

California Dreamer wrote: »

On the broad scale of things does Gary and his mates or Tracey and the girls going off for a weekend really care what country the aircraft is registered in apart from getting a cheap fare?

They closed the Faro base a few years ago, but maintained all the flights. As the previous poster pointed out, "pulling out" is not the same as "not flying to"

For a small country and a small city Dublin is incredibly well connected, you can get to most major European cities every morning, when apparatus and people relocate to other parts of Europe, there will be less focus on Dublin and potentially less connectivity into the future.

Since the days of Guinness Peat Aviation and the Ryan family - Ireland has been a hub for aviation, SITA, ViaSAT, TravelPort are all massive employers in Ireland, not suggesting they'll pull out, but most of those offices were once small Irish startups selling into aviation, so this network effect is being damaged.

Also once upon a time David O'Brien was tipped to be Michael O'Learys replacement, he has relocated to Malta and is building up their office there. If he does become CEO next, will he stay in Malta, will Ryanair be a predominantly Maltese company?

Irish government need to step up here and make sure Ryanair don't reflag everything.

Valhallapt · 23-03-2021 10:33am

California Dreamer wrote: »

For the purpose of education, could you expand on the material effect on livelihoods?

To understand this, you need to take back a step and ask why Malta are bending over backwards to help Ryanair. The taxes for aircraft registration are minimal, they are making a play for the jobs that go with maintaining the registration. When Ryanair pulled out of Faro they maintained all the flights - but sacked all the local crew.

California Dreamer · 23-03-2021 10:33am

Valhallapt wrote: »

Irish government need to step up here and make sure Ryanair don't reflag everything.

Let's be honest now, the Irish government won't do dick!

Malta has many perks to it, with the most important being that nonresident corporations only pay very minimal tax on the income they earn. In addition, there are various tax offsets that are provided to the individual and business that can make Malta very alluring. Specifically, when a foreign resident of Malta becomes a resident of Malta, the income earned outside of Malta and remitted to Malta can escape tax in Malta. Moreover, Malta is part of the EU —

Result: When a U.S. company effectively relocates to Malta, with significant income being generated from outside the U.S. and no permanent establishment in the U.S., the company may enjoy great tax benefits.

Taken from:
https://www.lexology.com/library/detail.aspx?g=d50f70d1-8b52-431f-80c3-a2cf23cd59e0

Then there is this and I would consider the important part. Corporation Tax

According to our income tax legislation, Maltese companies are subject to corporate tax at the rate of 35% on their worldwide income and capital gains. Foreign companies, incorporated outside Malta carrying out business activities in Malta are liable to tax on income arising in Malta.

https://cfr.gov.mt/en/Corporate/Pages/Corporate-Tax.aspx

Valhallapt · 23-03-2021 10:37am

California Dreamer wrote: »

Let's be honest now, the Irish government won't do dick!

Malta has many perks to it, with the most important being that nonresident corporations only pay very minimal tax on the income they earn. In addition, there are various tax offsets that are provided to the individual and business that can make Malta very alluring. Specifically, when a foreign resident of Malta becomes a resident of Malta, the income earned outside of Malta and remitted to Malta can escape tax in Malta. Moreover, Malta is part of the EU —

Result: When a U.S. company effectively relocates to Malta, with significant income being generated from outside the U.S. and no permanent establishment in the U.S., the company may enjoy great tax benefits.

Taken from:
https://www.lexology.com/library/detail.aspx?g=d50f70d1-8b52-431f-80c3-a2cf23cd59e0

Then there is this and I would consider the important part. Corporation Tax

According to our income tax legislation, Maltese companies are subject to corporate tax at the rate of 35% on their worldwide income and capital gains. Foreign companies, incorporated outside Malta carrying out business activities in Malta are liable to tax on income arising in Malta.

https://cfr.gov.mt/en/Corporate/Pages/Corporate-Tax.aspx

Ultimately this is correct, Ireland is having done to it what it does best to other countries, race to the bottom on taxes...

23-03-2021 12:42pm

I used to think state-facilitated aggressive tax and regulatory planning for multinationals was useless unless the multinationals produce jobs.
Here I'm now thinking that with the exception of aviation firms who produce jobs around the airport that state-facilitated aggressive tax and regulatory planning is bad.
Ireland seems to be incapable of getting investment anywhere outside the canals/D4/D6 and in those areas provision of infrastructure is prohibitively expensive.
All the jobs seem to be going to the City Centre and it is having a negative impact on quality of life for those who live in the city and provision of even the simplest of infrastructure so expensive that it makes provision of infrastructure at the airport look cheap.

Irish Government probably should ensure we don't lose our competitive advantage to Malta for Aviation as Dublin Airport can handle the expansion and North West County Dublin can handle the increased demand on infrastructure in that location. Aviation has provided a lot of jobs in terms of quantity and quality in various professions to Ireland.

Inquitus · 23-03-2021 12:50pm

Head office will remain in Airside, Swords, they just built a new building on the adjacent ground to house more people.

Nijmegen · 23-03-2021 1:00pm

California Dreamer wrote: »

For the purpose of education, could you expand on the material effect on livelihoods?

The erosion over the long term of aircraft based and registered in Ireland will reduce the services provided in Ireland to support. This ranges from soft services - as a really practical example I assume Ryanair HR in Dublin can offload people supporting now Polish based subsidiaries - to eventually hard services and the decision making. There's an argument that the management team of any org pay more attention to things that are under their arses - Would a management team in Poland think twice about Hanger 6 back in the day? If Ryanair is moving its management around Europe to show decisions being made overseas (which is a major part of substance creation for tax purposes), that management could also start making more Irish-decentralised decisions based on where they are as well as tax and other cost saving benefits.

There is the issue of corporate taxes particularly within Europe with OECD rules changing and making substance and place of supply a lot more relevant to calculating how and where you pay taxes. Time aircraft spend sitting somewhere overnight (if done habitually rather than the odd aircraft at an outstation, for example) will likely be in the mind of planners as taxes become a larger part of the profit maximisation strategy of the airline. Where they get their maintenance done if it's carried out by a group company might matter a lot. Again changing the hard services offered. Not all of this is Ryanair's doing, they don't create corporate tax rules, but equally our Dept of Finance doesn't seem to be responding to the situations that tax rules create for companies they want to keep invested in Ireland.

And then for aircrew themselves, there's very clear examples of people being offered new contracts with new companies to fly from new bases or via new subsidiaries that has a material effect on their livelihood.

Reducing cost is the mantra of Ryanair. These moves shift real parts of their business to different jurisdictions in order to reduce cost, one of which is tax - and to avail of tax benefits you need to show substance which is generated through activities undertaken by people. The other cost is potentially in the people themselves - ala software developers in Poland being cheaper than in Dublin.

Ryanair is Ireland's most successful airline and one of the most successful airlines in the world. While we focus on creating tax planning strategies and making Ireland competitive for overseas investors to come in, it's odd that a home grown company is getting enticed to leave at least partially on tax. It speaks to a blind spot successive governments have had about supporting the domestic industries and firms we grow versus enticing in yank.

IngazZagni · 23-03-2021 1:27pm

The Malta subsidiary came from a push from the unions as well. On the Irish AOC Ryanair were unable to offer local contracts in places like Italy and Germany because they would effectively be double taxed. On the Malta AOC they have local contracts with lower income taxes and more local benefits. It's also allowed them to set up bases in France which was once seen as impossible due to Frances insistence on local contracts.
It baffles me why this wasn't possible with the Irish AOC. I doubt our government would be happy if all Irish staff started paying tax in Malta instead.

California Dreamer · 23-03-2021 2:41pm

IngazZagni wrote: »

I doubt our government would be happy if all Irish staff started paying tax in Malta instead.

Sorry I do not want to drag this thread off in another direction but successive Irish governments do not operate with joined up writing and just find it easy to go after the soft targets in terms of taxiation/stealth taxes.

Nijmegen · 23-03-2021 2:56pm

IngazZagni wrote: »

The Malta subsidiary came from a push from the unions as well. On the Irish AOC Ryanair were unable to offer local contracts in places like Italy and Germany because they would effectively be double taxed. On the Malta AOC they have local contracts with lower income taxes and more local benefits. It's also allowed them to set up bases in France which was once seen as impossible due to Frances insistence on local contracts.
It baffles me why this wasn't possible with the Irish AOC. I doubt our government would be happy if all Irish staff started paying tax in Malta instead.

It was specifically addressed in the articles linked - the DoF had letters and memos to the minister in the run up to budget 2019 but they chose not to take action around it, is my understanding. It's one part of the puzzle - a piece I suggest Ryanair likes to put front and center because it hurt workers. But their tax planning generally is going well beyond just the PAYE issue.

23-03-2021 3:51pm

Aviation is a "Flag of Convenience" business like shipping.
If Government don't understand that then they lose business.
If they do understand that then it is up to Government to decide if they want to chase the business or not.

goingnowhere · 23-03-2021 4:17pm

The irony of Ryanair saying it will reflag some of the fleet to Italy

Alitalia's fleet are on EI reg

Though this tax issue could explain why Easyjet went with Austria when it reflagged part of its fleet to avoid Brexit issues

Tenger · 23-03-2021 7:25pm

goingnowhere wrote: »

The irony of Ryanair saying it will reflag some of the fleet to Italy

Alitalia's fleet are on EI reg
........

Technically the Alitalia fleet (and all other commercial aircraft in Italy) are under the flag of the owner of the aircraft. As Ireland has such a large leasing sector most of the leased Alitalia aircraft are "EI reg-ed".

I've seen many "I reg" aircraft in Alitalia livery. These are owned by Alitalia themselves.

IngazZagni · 23-03-2021 8:21pm

goingnowhere wrote: »

The irony of Ryanair saying it will reflag some of the fleet to Italy

Alitalia's fleet are on EI reg

Though this tax issue could explain why Easyjet went with Austria when it reflagged part of its fleet to avoid Brexit issues

The issue relates to Irish AOC's headquartered in Ireland. It doesn't apply to Alitalia as their HQ is in Italy. That's how stupid this rule is.

Beechwoodspark · 23-03-2021 8:32pm

Won’t be sorry to see them go but do have sympathy for their staff if they will be let go

23-03-2021 9:25pm

You're destined to be disappointed. The same number of Ryanair planes, if not more, will fly in and out of Ireland.

California Dreamer · 24-03-2021 9:01am

Deleted User wrote: »

You're destined to be disappointed. The same number of Ryanair planes, if not more, will fly in and out of Ireland.

Nobody is questioning that. As was pointed out they pulled out of Faro but still operated flights there.

24-03-2021 12:35pm

California Dreamer wrote: »

Nobody is questioning that. As was pointed out they pulled out of Faro but still operated flights there.

Perhaps you don't know Beechwood Park's backstory.

L1011 · 24-03-2021 12:52pm

Deleted User wrote: »

Perhaps you don't know Beechwood Park's backstory.

They are specifically not allowed talk about / bring in environmental stuff on off-topic threads, so please don't try lead that to happen

yew_tree · 24-03-2021 9:55pm

Ryanair today announced new services from Knock to Manchester and Edinburagh. This fills the void left by FlyBe. Great news!

The airline now operate to 13 destinations from Knock.

Nijmegen · 25-03-2021 3:14pm

yew_tree wrote: »

Ryanair today announced new services from Knock to Manchester and Edinburagh. This fills the void left by FlyBe. Great news!

The airline now operate to 13 destinations from Knock.

Yeah I think there's a major distinction folks need to wrap their heads around re "Ryanair pulling out of Ireland" - it won't lead to a single reduction in flights that can be filled by them from here, which is a really important market they have significant share of. This in an Ireland Inc and Ryanair PLC thing, nothing really to do with flights or getting to your sun holiday.

micosoft · 28-03-2021 5:24pm

Deleted User wrote: »

I used to think state-facilitated aggressive tax and regulatory planning for multinationals was useless unless the multinationals produce jobs.
Here I'm now thinking that with the exception of aviation firms who produce jobs around the airport that state-facilitated aggressive tax and regulatory planning is bad.
Ireland seems to be incapable of getting investment anywhere outside the canals/D4/D6 and in those areas provision of infrastructure is prohibitively expensive.
All the jobs seem to be going to the City Centre and it is having a negative impact on quality of life for those who live in the city and provision of even the simplest of infrastructure so expensive that it makes provision of infrastructure at the airport look cheap.

Irish Government probably should ensure we don't lose our competitive advantage to Malta for Aviation as Dublin Airport can handle the expansion and North West County Dublin can handle the increased demand on infrastructure in that location. Aviation has provided a lot of jobs in terms of quantity and quality in various professions to Ireland.

That's simply not true. There are plenty of jobs all over Dublin. Count the cranes in Sandyford where Microsoft etc have huge headquarters. Then outside Dublin you have Intel, Kerry group in the environs. Some businesses have decided to locate in Dublin City Centre because thats where their staff want to be. Post Covid this entire subject is even less of a problem. As a knowledge economy Ireland will benefit more than most from distributed workforce. It's a pity that one off housing that the Irish like makes it so much more expensive and difficult to roll out rural infrastructure like broadband.

Infrastructure is no worse than most other cities - I'd love to see an underground but the challenge there is Nimbyism and an electorate that don't reward long term projects.

28-03-2021 5:29pm

micosoft wrote: »

That's simply not true.

Have you made account of the cost of upgrading infrastructure in Sandyford. Have you tried to get in and out of Sandyford in rush hour.

I could make the same point about Nangor Road or Lucan Village or Blanch.

Many parts of Dublin are not "better" for inward investment's side effects.

micosoft · 28-03-2021 5:33pm

Nijmegen wrote: »

Ryanair is Ireland's most successful airline and one of the most successful airlines in the world. While we focus on creating tax planning strategies and making Ireland competitive for overseas investors to come in, it's odd that a home grown company is getting enticed to leave at least partially on tax. It speaks to a blind spot successive governments have had about supporting the domestic industries and firms we grow versus enticing in yank.

The challenge is the Irish Government can't win it all. We were a low cost low tax destination. No more. We are a rich country with high standards and cost of living and an electorate that are demanding high levels of state services. The country Ryanair grew up in is no more. There is a natural evolution here - remember Dell moved it's factory to Poland and there was weeping and knashing of teeth and huge criticism of the government of the day. But whats happened is that Dell are bigger in Limerick than when they did manufacturing, and instead of factory operatives they have thousands of consultants, developers etc in much higher value roles.

I personally think Ryanair is simply optimising its value chain or even value network across Europe moving components to the most efficient location possible. Nobody should be surprised at this - it's what Ryanair does. That means low value add activities moving to Poland, tax sensitive to Malta and potentially high value (HQ and other) activities kept in Dublin. I would not panic yet.

But my fundamental point is that the Government can't be all things to all businesses - it has to optimise the business it attracts and retains for the development stage Ireland is at. Some models just don't fit that any more. The important thing is that new higher value models are attracted in their stead.

micosoft · 28-03-2021 5:37pm

Deleted User wrote: »

Have you made account of the cost of upgrading infrastructure in Sandyford. Have you tried to get in and out of Sandyford in rush hour.

I could make the same point about Nangor Road or Lucan Village or Blanch.

Many parts of Dublin are not "better" for inward investment's side effects.

Yes I have. About 20 minutes at the moment from North Wicklow.

But if you mean during boom time - It's not great. But it's definetly not terrible. Have you commuted in San Jose? London in summer on the un-airconditioned tube? Seattle to Bellevue? Paris ring road? All major cities have infrastructure woes.

Anyway - the point was on jobs - and they certainly do go outside the canals. And post-covid a lot of these problems are actually going away.

Nijmegen · 29-03-2021 10:43am

micosoft wrote: »

The challenge is the Irish Government can't win it all. We were a low cost low tax destination. No more. We are a rich country with high standards and cost of living and an electorate that are demanding high levels of state services. The country Ryanair grew up in is no more. There is a natural evolution here - remember Dell moved it's factory to Poland and there was weeping and knashing of teeth and huge criticism of the government of the day. But whats happened is that Dell are bigger in Limerick than when they did manufacturing, and instead of factory operatives they have thousands of consultants, developers etc in much higher value roles.

I personally think Ryanair is simply optimising its value chain or even value network across Europe moving components to the most efficient location possible. Nobody should be surprised at this - it's what Ryanair does. That means low value add activities moving to Poland, tax sensitive to Malta and potentially high value (HQ and other) activities kept in Dublin. I would not panic yet.

But my fundamental point is that the Government can't be all things to all businesses - it has to optimise the business it attracts and retains for the development stage Ireland is at. Some models just don't fit that any more. The important thing is that new higher value models are attracted in their stead.

I agree completely govt can't be all things to all people. But in this case we have correspondence from within the Dept of Finance where a specific issue was raised, noted, and the response was basically "We know this is happening but it'd be too much hassle for them to carry through on their threat to leave." I'd bet a solid weeks wages if they got a letter like that from Apple, Microsoft or Intel pointing out a tax loophole harming them, the DoF would have it sorted by budget time.

Ryanair pulling out of Ireland

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