Ireland Stands Firm On Low Company Tax Rates

Irish Prime Minister Enda Kenny has publicly reiterated his commitment to the 12.5 percent corporate tax rate “from a tax certainty point of view.”


In a speech to the American Chamber of Commerce Ireland (Amcham Ireland), Kenny stressed that the rate will not change, and acknowledged that “that is an important element for consideration with American investors coming here to Ireland.”


Bob Savage, President of Amcham Ireland, welcomed Kenny’s statement. He said the Chamber “deeply appreciate[s] the Taoiseach’s unambiguous declaration that his Government will steadfastly defend our hard-earned reputation as a pro-business country that is defined by fairness and certainty of treatment.”


In its pre-Budget submission, Amcham Ireland emphasized the need for Ireland “to evolve its corporate tax regime in response to the post-BEPS landscape to remain competitive.” (Base erosion and profit shifting BEPS is a tax avoidance strategy used by multinational companies, wherein profits are shifted from jurisdictions that have high taxes such as the United States and many Western European countries to jurisdictions that have low or no taxes ie so-called tax havens).


Kenny’s comments were later echoed by his Finance Minister, Michael Noonan. “We could nearly put it on the flag now because everybody knows internationally that the rate is 12.5 percent. Actually, when industrialists think of Ireland, they automatically think of 12.5 percent. But just in case there’s doubt, I’ll confirm it again in this year’s Budget,” Noonan said.


Noonan added that the Government is under no pressure from the European Union (EU) to change the rate in the wake of the Commission’s decision that Ireland had provided selective tax treatment to Apple. “The European Commission acknowledge that the right to set tax rates is a matter for sovereign governments; it’s not for Europe or the European Commission,” he explained.


In the wake of these bold public statements you can expect the low Tax Irish Company to remain a popular choice of tax planning vehicle for discerning International Trading business owners the world over. That said the key to success in using Ireland as your corporate base is to ensure that you are not seen to be exercising management and control over the company from your home country (which would entail, as a minimum the appointment of a Nominee Director + establishment of an Offshore Discretionary Trust or, ideally, a Private Foundation to act as shareholder). For information on how that can work for you please contact us.


Comments are closed.