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Dublin: 7 °C Thursday 23 May, 2013

Green Party calls for corporation tax reform

The party urged the Government to close the ‘Double Irish’ loophole which it said enables companies to pay less than 12.5 per cent tax.

The offices of Google Ireland
The offices of Google Ireland
Image: Mark Stedman/Photocall Ireland

THE GREEN PARTY has urged the Government to alter Ireland’s corporate tax regime to close a loophole which it said allows companies to avoid paying the full rate.

The move would give Taoiseach Enda Kenny a strong negotiating position when he travels to Brussels this evening to lobby for economic stimulus measures at an informal summit of EU leaders, the Green Party said.

Party leader Eamon Ryan called on the Government to end the so-called ‘Double Irish’ tax avoidance strategy, which he said is used by multinational corporations to pay far less than the official 12.5 per cent rate.

The Taoiseach will have a better negotiating hand at the European Council meeting if he shows he is willing to change one of the worst aspects of our tax laws. The ‘Double Irish’ tax dodge is a scandal and it is time for it to go.

The ‘Double Irish’ is a strategy in which firms move money between two Irish-registered companies – one located in an offshore tax haven – in order to reduce their tax liability.

BusinessWeek reported in 2010 that Google used the scheme to keep its effective tax rate at 2.4 per cent outside the US.

Ryan said there would be “minimal” risk of companies pulling out of Ireland if the loophole was closed. “It is hard to see how they would justify a practice which shows a lack of any corporate social responsibility,” he said.

Read: So far… 2012 tax take ahead of target>

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Comments (37 Comments)

  • Choooon 23/05/12 #

    “The move would give Taoiseach Enda Kenny a strong negotiation position”

    That would only be useful if he actually knew how to negotiate, rather than bending over every time he is asked!

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  • The who party!

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  • Didn’t they have almost 4 years in power to do just that!
    But instead they brought in a silly low rate of tax on cars bought from 2008 onwards, making all cars bought befor that practically worthless!
    Emissions based you say in your defence!!!
    Does the year of a car make a differance to emissions? Is a 2007 different to a 2008?

    Thanks for nothing Eamon Ryan
    You’s got what you deserved

    God I hate politicians

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  • Right after Carbon Tax reform

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  • I’m embarrassed to think these guys held a position of power in this state if that’s their understanding of business. They are here for the tax benefit. We benefit by all the job creation and paye these guys pay. Increase tax and they relocate to one of many other tax havens available. Eamon ryans idea of showing them up as socially irresponsible is just laughable

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    • Maybe it is time to put an end to all these tax havens. This is the proposal that France is putting forward that companies pay tax depending on where they sell their goods into. Small businesses employing less than 10 people up and down the country are not paying 2.4% tax. If we encouraged more small businesses it would be a positive step. These wealth making companies have to make a fair contribution not running off to the cheapest tax haven. Too much wealth in too few hands is not good for the world.

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  • Are those idiots still around!

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  • Nooooo! The only thing holding companies like google, intel, facebook, PayPal, HP etc is our competitive CT rates. If even 5% of these companies jumped ship, can you imagine the effect that would have on the economy? Highly skilled, highly paid people on the dole queue. I accept their affective rate of tax is low but its a trade off.

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  • iBob101 23/05/12 #

    The green “party” are a small bunch of political losers. They had several years in government to pontificate at us. That’s more than enough. This particular idea of theirs is truly stupid. It might seem “noble” to demand more taxes from them but the truly noble thing is to keep investment and jobs in Ireland.

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  • The green what now?

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  • How would it give him a strong position to negotiate; France and Germany want us to charge higher taxes.

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  • What party??

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  • Unelected trolls

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  • Didn’t think I’d ever agree with the “tax it to solve it” Green Party but due to the current situation we are in with everyone being asked to contribute more it is high time that all companies contribute proportionally.

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    • Think of the net resault please.tax them and perhaps they leave .can we afford that?no .they are a positive influence here even though they get a better deal than the rest of us.don’t kill the goose that lays the golden egg.not now at least

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  • Yes maybe we should send eamon ryans off to all the other tax havens around the world and get them to all close these loopholes simultaneously and replace them with more green social caring policies. I’m just glad they’re choosing us to run their evil profits through no matter what the rate is. Every time one of these guys set up here a multitude of small support businesses are created to support them. By the way that’s why all businesses are set up, it’s to generate profits for the owners not as a charity contributing to the ‘ fairness ‘ of society(even the small businesses)

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  • Low corporate tax is the ONLY thing that keeps those companies in Ireland. Educated, English-speaking workforce? You get that anywhere for much less. Irish workers are amongst the most expensive in Europe with minimum wage 10 times higher than that in Poland and 2.5 times higher than Spain’s.

    So the effective tax rate in Ireland for smarter companies is 2.4%. I think it’s very good. Likes of Google have heaps of employees who are in the 41% tax rate and spend the remainder with 23% VAT. How is it bad for the exchequer?
    The alternative is the companies move to another country.

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  • Why not have a minimum universal social charge for companies and reform commercial rates?

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  • Dame right them loopholes only help the rich and now were in this period of austerity I think the money would do better in the country and not the Cayman islands . They should off did that before they raided the old age pensioners and the lone parents but thats just me what would i know

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    • Do that and my job along with tens of thousands of others will vanish. That’s a lot of people to be dumping on the dole, that’s a helluva lot of tax revenue to disappear, and that’s a lot of consumer spending eradicated. It will destroy what is left of our floundering economy. Anybody advocating this, is in my opinion, a complete idiot.

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    • Scarr 23/05/12 #

      Why would your job go barry? There does seem to be room to close the double Irish loop and very marginally increase corp tax, at the moment we are lower than Palestine in corp tax

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    • Many of these companies are here because of the low corporation tax. In return they provide massive employment. Simples.

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    • Scarr 23/05/12 #

      Oh right. Better not rock the boat is it? Google et al are paying an effective 2.4% on the millions they earn. I have not heard why a 0.5 to 1% would have them leaving in droves. They can afford it and we are pretty well positioned to do it at some point in the near future. Sure by your logic, let’s just drop the corp tax altogether and get loads more mnc’s in. Simples.

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    • It is terrible that Ireland allows such loopholes. It all double think. So the big companies pay little or nothing to pay for government and the less well off. I wonder if we are making anything on their presence after the grants from the Ida are taken into account.

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    • 2.4% of billions is better than 0% of f@*k all.

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    • More MNC’s means more employment – that means less unemployment, more tax revenue, more consumer spending. Three positives to help the economy. So from that, an argument to drop corporation tax could be made. A compromise could be a progressive corporation tax rate that is lowered if a company employs over a certain amount of people.

      Make no mistake – I’m no corporate loving blueshirt. I couldn’t give a toss about making corporations richer. I just see that Ireland is an export driven economy (one of the biggest software exporters in the world actually) and this should be exploited for our own gain. Do you see the Chinese destroying their own export driven economy just because their neighbours want them to?

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    • And so we thought Google and other MNCs were here because Ire were in the euro area? I think more to do with the pittance they are paying in tax. Says a lot about this country when we have to rely on being a tax haven for the rich.
      Catch 22 situation. We have little to no resources.

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    • Pure nonsense. 12.5 tax rate is extremely reasonable, we don’t need companies paying any less. Political debate has been so watered down by all this extreme right-wing lunacy about corporation tax. People should get it into their heads that even in the days of Thatcher and Reagan companies paid way more in tax and it worked fine. ‘Anyone advocating this is a complete idiot’. Say that to a bunch of sensible economists on both the left and right who think all this loophole business is pure non sense.
      The very idea that a regular middle-class person who is not a corporate leader would advocate something like this to me…is completely insane, and shows how much we’ve lost the plot as a country.
      The idea that despite the recession getting deeper, and austerity only making it worse, people continuing to advocate this absolute madness that got us into this mess, is a joke….and not a very good joke at that.

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    • So Barry. you’re advocating a further shift in the tax burden away from profit and on to work. At what point do you think working people might loose entirely the incentive to work for a tax avoiding MNC, or anyone else for that matter?

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  • Green party? Never heard of them ;-)

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  • I didn’t think you could be considered a political party without a single member in government

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  • Only middle & Poor people pay tax not the richest companies in the world. We can’t expect them to cough up!

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  • Good riddance to you!

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