Abbott Laboratories Irish subsidiary paid no tax on €1.8 billion profit
Minister Richard Bruton says claims of Irish tax deals with multinationals are unfounded
Abbott Laboratories has had a presence in Ireland since 1946.
An Irish subsidiary of the US pharmaceutical group Abbott Laboratories made a profit of €1.8 billion in 2011 but paid no tax because it was not resident here for tax purposes. A second Abbott subsidiary made a profit of €1.1 billion and paid no tax.
The latest revelation about Irish subsidiaries of a US multinational comes as Minister of State for European Affairs Lucinda Creighton left yesterday for a four-day trade mission to Washington and New York.
The trip was planned prior to last week’s controversy over Ireland’s role in multinational tax issues but Ms Creighton is expected to use the trip to combat the negative publicity Ireland has received on the issue.
‘Non-resident Irish entity’
Accounts for Abbott Mature Products International Ltd say the company is a “non-resident Irish entity incorporated in Bermuda” and that it would have been liable to €235 million in Irish corporation tax were it not exempt under the tax code.
The directors of the company are all US-based and the Abbott subsidiary appears to escape Irish tax for reasons similar to those that featured in US senate hearings last week in Washington that considered the tax affairs of Apple.
During those hearings Ireland was repeatedly referred to as a “tax haven” and it was alleged that Apple had secured a deal with the Irish government some years ago that allowed it pay well below Ireland’s 12.5 per cent corporation tax rate.
Both claims have been vigorously denied by the Government. Yesterday Minister for Jobs, Enterprise and Innovation Richard Bruton said claims that Ireland did tax deals with multinationals were “unfounded”.
It emerged at the Washington hearings that the Apple companies were not tax-resident anywhere because while they were incorporated in Ireland, they were managed and controlled from the United States. This had the effect of allowing them slip outside the qualifying criteria for taxation in both jurisdictions.
Abbott Laboratories has had a presence in Ireland since 1946. A spokeswoman for the company said: “As a major Irish employer Abbott makes significant contributions to the Irish exchequer and structures our tax arrangements in full compliance with all local laws and regulations.”