Large majority favours keeping 12.5% corporation tax rate, poll finds

As State set to accord with OECD 15% rate for multinationals, only quarter of voters agree

 Taoiseach Micheál Martin: ‘The vast majority of companies will not be impacted.’ Photograph: Daragh Mac Sweeney/Provision

Taoiseach Micheál Martin: ‘The vast majority of companies will not be impacted.’ Photograph: Daragh Mac Sweeney/Provision

 

A large majority of voters believe the Government should maintain Ireland’s 12.5 per cent rate of corporation tax, the latest Irish Times/Ipsos MRBI opinion poll has found.

The poll comes as the Government is expected to announce on Thursday that it will join the Organisation for Economic Co-operation and Development (OECD) agreement to raise the tax rate on large multinational companies to 15 per cent, after months of wrangling to secure changes to the global deal.

Respondents to the poll, which was carried out last weekend and earlier this week, were asked which of two statements came closest to their views about what the Government should do on corporation tax. The first statement, “The Government should maintain Ireland’s 12.5 per cent corporation tax rate even though other countries want to harmonise the rate at 15 per cent”, saw 59 per cent of respondents saying they agree.

The second statement, “The Government should join international efforts to harmonise corporation tax at 15 per cent even though it may lead to a drop in corporation tax revenues”, was agreed with by just 26 per cent of respondents.

The remaining 15 per cent said they didn’t know or had no opinion.

Minister for Finance Paschal Donohoe looks set to ask Cabinet colleagues to give clearance for Ireland to sign up to the OECD deal, which would mean the end of Ireland’s 12.5 per cent tax rate and its replacement with a rate of 15 per cent.

Taoiseach Micheál Martin gave strong indications on Wednesday that Ireland would sign up to the deal.

He said he did not want to pre-empt the Cabinet decision, but that changes to the text of the agreement had improved the situation as far as Ireland was concerned.

“We were very anxious and we did enter reservations when the consensus was agreed some time ago. We indicated that we felt that the language, particularly around ‘at least’, was not acceptable to us,” he said after an EU leaders’ meeting in Slovenia.

Hungarian stance

“That language has been removed. That does improve the situation significantly from our perspective. Its application also is to a small number of companies that are above a significant threshold of turnover and value. So the vast majority of companies will not be impacted.”

There were signs on Wednesday that Hungary, which has a corporation tax rate of 9 per cent and is one of the EU’s other last holdouts in opposition to the OECD deal, was preparing to drop its objections.

Budapest is “ready to compromise if we can agree on a regulation that does not harm the Hungarian economy and does not endanger Hungarian jobs”, its foreign minister Péter Szijjártó wrote on Facebook.

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