George Osborne has been under immense pressure in the House of Commons. His move to lend £7 billion to Ireland is deeply unpopular. MPs rightly worry that it may not have the capacity to repay.
But the Guardian then notes this:
The chancellor also rejects a call from another MP that Ireland should be forced to raise its 12.5% corporation tax. It would not be in Ireland's interest to force through tax changes that "lead to an immediate flight of international businesses."
Osborne, the tax dodger, the believer in the Celtic Tiger, sticks to his principles. Ireland couldn’t lose international business he says. No way. Google and Microsoft might then have to pay tax in the UK on the profits I think they make on their sales into this country — currently recorded in Ireland. And that would never do, would it? In Google’s case I have estimated this loss at £100 million a year to the UK. Well that would be a useful loan insurance premium on the Irish loan risk, I think. But not according to George Osborne, who clearly does not understand these issues.
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Michael Crick (Newsnight) has noted that Osborne’s Irish loan needs rapid approval of primary legislation: an invitation for a back bench euro-sceptic rebellion.
Bless him – Osborne really is not very smart…We have our very own G-Dubya!
There is alot of press about the Irish 12.5% Considering the likes of Google pay close to zero % die to the Dutch loophole, surely the focus should be plugging that hole. At lease the irish would get 12.5%. And i would be interested in the economic benefit to the Netherlands
Not much discussion about ‘the deficit’ in this affair, or the fact that Ireland ran budget surpluses until the financial collapse.
Michael Noonan’s prognosis is rather disturbing for anyone harbouring outdated ideas of sovreignty or democracy:
The finance spokesman for Ireland’s main opposition party predicted that the IMF and the Europeans would impose huge pay cuts and slash the public sector.
Fine Gael’s Michael Noonan said: “They wouldn’t probably specify a cut in the minimum wage, but they’d say you have to get your labour market working properly. You have to do like they’re doing in the UK and ensure work is always more valuable than welfare.”
Noonan warned that the IMF had no interest in “taking a few civil servants out” here and there.
“They’ll be looking for the dropping of programmes and a totally new way of delivering services to the public which will cost less with fewer people.”