A defiant Ireland tonight insisted its corporate tax regime was an "absolute red line" as it took a hard-line stance in the opening skirmishes with Europe and Washington over a possible bailout.
Then it’s expulsion from the Euro time and support fro the bad debt in the banks that suffer but not Ireland in that case.
Tax abuse has to go as part of any deal.
Non-negotiable.
And if the people of Ireland want the bail out they need to get out on the streets and say scrap the tax. It’s their choice.
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Having a 12.5% corporate tax rate is not abusive. Scrap it and more jobs go, plunging ireland into even deeper misery. They are right to draw the red line
The Irish are probably running the numbers….
Potential loss in business due to a corporate tax increase versus bailout money.
Help from Europe vs Help from other sources (The IMF? Why would they go out of their way for Ireland, specially without European support?)
Will a red line be crossed?
The problem for these guys is that they don’t necessarily have all the time in the world….
Time for a small laugh:
http://newsthump.com/2010/11/18/newsthump-radio-news-irish-financial-crisis-exclusive/
[…] thought I was being little belligerent last evening when writing about Ireland and wondered whether to post the item (yes, I do suffer moments of doubt, but not many, I […]
Scrap the favorable tax rate and these US companies will up the stick overnight (noth quite) and move their European headquarters to one of Switzerland’s many welcoming cantons, where they will join Dupont, HP, McDonalds, IBM, Yahoo (not that it has much profit to tax), etc.
And since Switzerland is unlikely to require a bailout in the next trillion years (and the ones afetr that too), there is nothing the EU will be able to do about it.
The only losers in this will be (i) the Isrish, and (ii) their current and future creditors.
Ireland abused it’s membership of the EU to engage in tax competition with other EU countries, despite receiving generous grants from the EU to improve it’s infrastructure, and hence make it more attractive to such businesses.
So yes, now that the fecklessness and incompetence of Irish bankers and politicans has got them into the current position, an end to this practice should be a condition of any bailout.
And as for Switzerland…….
perhaps it is an interesting tussle, but its about saving the euro project. Corporate tax rates are irrelevant.