US and EU Pressure Ireland to Change Its Favorable Tax Regime
Ireland has come under sustained attack from Europe and the United States over the past 18 months for its tax rules that allow multinational companies such as Google and Apple to cut their overseas tax rates to single digits.
The government is set to bring in new measures in its budget on Tuesday that would mean all Irish-registered companies would over time automatically be deemed to be tax resident in Ireland, the sources said, bringing Irish law in line with U.S. and British rules.
At risk for Ireland are the 160,000 jobs—or almost one in every 10 workers in the country—who are employed by the more than 1,000 foreign firms that have set up an base in Ireland to benefit from its low 12.5 percent corporate tax rate and flexible, English-speaking workforce.
Strangely, you never hear financially sound countries, like Switzerland, Singapore, or Hong Kong screaming for other countries to change their relatively favorable tax systems. It’s only the failed welfare states drowning in debt, and that’s not a coincidence. For more on that see this IM article.