Cantillon: Other states seek Ireland’s tax edge
Barry O’Leary chief executive of the IDA said: “We do promote the tax credits that are available for research and development investment.”
“Cautiously optimistic” is the line from IDA Ireland on the state of foreign direct investment into Ireland for the remainder of the year. Given the lack of optimism in the general business world, it’s welcome news, even if tempered with caution.
We are facing increasing competition from our European brethren. According to chief executive Barry O’Leary, both the UK and the Netherlands have “upped their game” in seeking out foreign investment. And this is where corporation tax incentives come into play.
For all public statements by multinational executives that our tax policy is not a decisive factor in the decision to invest here, the IDA seems to believe it’s regarded as such by our competitors.
Mr O’Leary points to a number of jurisdictions including the UK, the Netherlands and Switzerland, which are attempting to enhance their tax offerings. Like it or not, corporation tax policy is part of the game plan in the market for foreign investment.
Mr O’Leary said the IDA didn’t know how many of its client companies were using the controversial “Double Irish” multinational tax avoidance strategy, which involves routing profits through Irish subsidiaries to companies controlled from tax havens such as Bermuda.
“We don’t promote it,” he said, when asked if the IDA highlighted the benefits of the “Double Irish” while touting for investment from new clients. “But we do promote the tax credits that are available for research and development investment.”
Presumably, then, tax will not feature in the IDA’s new North American advertising campaign. Mind you, there’s probably not much need considering the stand out job of promoting the low tax benefits of Ireland that was done by the US Senate’s recent hearing into Apple’s tax affairs.