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EU Probe

Multinational companies are not here just for tax breaks — Burton

Minister Joan Burton said that while Ireland’s tax rates are favourable, the companies still employ large numbers of people.

THE BEHAVIOUR OF multinational companies in Ireland does not suggest that they are locating here simply due to low tax rates, the Social Protection Minister has said.

Minister Joan Burton said that although a corporation tax rate of 12.5 per cent compares”very favorably with the tax rates of other EU countries”, multinationals have a “high employment content” in Ireland which is not consistent with countries where the tax system is being exploited.

She stressed other factors in Ireland, such as a highly educated English speaking population, as more important pull-factors when companies are looking to invest in Ireland, but that she is eager to see what an European Commission report into tax avoidance says.

Reports today state that tax deals made by the Irish government with large multinational companies are to be probed by the European Commission. Minister Burton said that it is important a detailed study is conducted into these tax affairs.

The Minister was speaking to reporters at Leinster House on the OCED report on Ireland published today, which said that while the economic crisis “left a legacy of unemployment and debts and now is the time to implement policies that will promote sustainable growth and job creation”.

Welcoming the report, she noted that it does not criticise Ireland’s efforts to boost job growth.

“They are correct to say that during the boom years, very little attention was paid to getting people on the live register back to work. In that sense Ireland, as a country, is a late starter.”

“We have reorganised the Department of Social Protection to switch the Department from being passive, and just handing out money, to actually having a huge developmental program to get people back to work. I’m happy to say that that is now bearing some fruit… we are now beginning a slow climb back in terms of employment numbers“.

Read: EU probe into Ireland tax deals with multinationals >

More: OECD says Irish economy recovering but government must stick to targets >

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