Wel all have to take the pain, so what about Corporation Tax?

RedPlanet

MG wrote: »

Of course, it will hurt someone, you'll have less money to invest in your business, less money to invest in your staff, less cashflow to pay your creditors, less incentive to innovate for profit and all to pay for an inefficient service.

A quick peek at their internal budget should reveal if that's true or not.
Are they for example, sinking more of their profits into R&D (thereby expanding R&D and marketing operations)?
Or, are they busy buying big boats, big houses and bonuses?
I reckon in this climate of short-term profit, it's the later.
Bring on Corporation Tax!

ionix5891

Thats right lets raise corporation tax [SARCASM]


thats all we need right now scare off the big MNCs (how many people they employ again) that took years to bait to come here

and also while we at it it will kill small indigenous irish businesses like mine, employing few local people

times are very tough as it is, any more tax would be a complete disincentive to continue operate in this country for me, after all I and my company need are reliable electricity and high speed internet (we already place servers in countries with better infrastructure)


what one is forgetting all the cowboys that made alot during the tiger years are all now laughing on cayman islands drinking rum, while the low earners and small companies get to pick up the tab, fracking unbelivable!

Permabear

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RedPlanet

bk wrote: »

No there is not.

Many US and UK companies funnel literally Billions of Euro of their profits through Ireland because of the low tax rate. This is purely an accounting instrument in order to reduce their tax burden, there is little or no staff or infrastructure involved, usually just a few lawyers and accountants.

They do this purely for the low tax rate, if we increased the CT rate, they could pull out literally overnight and we would lose hundreds of millions of revenue.


Basically these are only shell companies....
.

Basically you're saying they are exploiting our tax laws to avoid paying tax.
Which to me, sounds unethical if not illegal.

ionix5891

RedPlanet wrote: »

Basically you're saying they are exploiting our tax laws to avoid paying tax.
Which to me, sounds unethical if not illegal.

you missed the point mister

they avoid paying tax in their countries

they pay tax here then at 12.5% on money from other places, so to summarise we are getting a cut of the pie of the money made elsewhere and were doing so for quite some time, raising CT would mean we would get to eat no pie not a larger portion as yee SF'ners think (yes we all know SF has some disastrous economic policies planned)

raising corpo tax would mean these operations would move elsewhere and so will the money

im not an economist but i have a feeling raising corpo tax would not raise more money but instead greatly decrease the amount received overnight


so people think carefully about what you are proposing, there are reasons why this is not even being considered

RedPlanet

ionix5891 wrote: »

you missed the point mister

they avoid paying tax in their countries

they pay tax here then at 12.5% on money from other places, so to summarise we are getting a cut of the pie of the money made elsewhere and were doing so for quite some time, raising CT would mean we would get to eat no pie

It still stinks and is not sustainable.
All another country in the EU has to do, is lower their own corp tax rate to 12% and entice those "shell company's" to relocate their tax base there...

eoinbn

Anyone see Prime time last night? David Begg was giving his opinion on a number of taxs and even he was opposed to raising corporation tax.

ionix5891

RedPlanet wrote: »

It still stinks and is not sustainable.
All another country in the EU has to do, is lower their own corp tax rate to 12% and entice those "shell company's" to relocate their tax base there...

of course it stinks (and obama made it clear he doesn't like it) but its bringing much needed money into the coffers

i don't see anyone complaining when the going was good

take a read of this
http://www.commondreams.org/headlines07/0224-05.htm

Prime technology companies playing the offshore game are Microsoft and Google. Microsoft gets about 75 percent of its 40 billion dollars in revenue from licensing fees. A few years ago, it set up an Irish subsidiary called Round Island One Ltd. to own its 16 billion dollars worth of copyrights on software developed in the U.S.

In 2004, it shifted nine billion dollars in profits to Ireland and thereby avoided paying some 500 million dollars in U.S. taxes. Using the Irish company, Microsoft also avoids taxes elsewhere in Europe, the Middle East and Africa. The maneuver helped Microsoft drop its worldwide tax rate from 33 percent to 26 percent.

Google similarly set up an Irish subsidiary, Google Ireland Holdings Ltd, which in 2004, its first year, helped the company avoid paying about 131 million dollars in U.S. taxes. Google noted in its annual report that year that it expected its effective tax rate to drop even more significantly. It explained, "This is primarily because proportionately more of earnings in 2005 compared to 2004 are expected to be recognised by our Irish subsidiary, and such earnings are taxed at a lower statutory tax rate (12.5 percent) than in the U.S. (35 percent)."

im not an accountant but 12.5% tax on this "income" is better than (12.5 + n)% tax on no income!


also yes there are less taxing countries but Ireland is in EU (despite SF and Liberats best efforts to get us to leave! ahem Lisbon) and no other EU country considered lowering the corpo taxes and the same cultural ties and language

raising corporation tax would sink this country faster than you can say Titanic

edit: I wanted to add that Google Ireland Holdings Ltd does business with my company, a loss of a Google (or any other large company here) would result in a quite a few job loses in companies that spring around these large multinationals, I still remember how after DIGITAL closed here in Galway it resulted in chain reaction of closures

.

sovtek

MG wrote: »

As we know, private industry is the creator of wealth in this country.

Labour is the creator of wealth.

sovtek

MG wrote: »

No offence but have to say that the OP shows an astonishing lack understanding of business & economics.

I really get annoyed when people say things like this. Economics is no harder to understand than primary school maths. The only thing that is remotely difficult about economics is learning difficult terms for simple concepts that economists use.
Incidentally the top economists in the world have shown themselves to be quite ignorant,incompetant or subservant as of late.

sovtek

ionix5891 wrote: »

raising corporation tax would sink this country faster than you can say Titanic

Then why do all the strongest economies have higher corp tax?

yoshytoshy

sovtek wrote: »

Then why do all the strongest economies have higher corp tax?

Why are other economies strong is the right question.

mickoneill30

sovtek wrote: »

Then why do all the strongest economies have higher corp tax?

You mean the economies that have a lot of companies that base themselves in Ireland?

ionix5891

sovtek wrote: »

Then why do all the strongest economies have higher corp tax?

because they have factories/industries/businesses that make wealth making for strong economy

we have chancers/builders/bankers that destroy wealth making for weak economy

clear now?

our GDP shot up to one of the highest in world in recent years, why? because all that loaned money flowing in was counted in the GDP figures, basically we have fallen prey to distorted statistics, hence we are no waking up to the fact that we are alot poorer than we taught and its hard to make end meets for everyone from the government to the joe blogs

raising corpo taxes would take the floor from under our falling economy and will be bad^TM

.

irish_bob

ionix5891 wrote: »

because they have factories/industries/businesses that make wealth making for strong economy

we have chancers/builders/bankers that destroy wealth making for weak economy

clear now?

our GDP shot up to one of the highest in world in recent years, why? because all that loaned money flowing in was counted in the GDP figures, basically we have fallen prey to distorted statistics, hence we are no waking up to the fact that we are alot poorer than we taught and its hard to make end meets for everyone from the government to the joe blogs

raising corpo taxes would take the floor from under our falling economy and will be bad^TM

.

+1

ive been saying this for weeks now , this country was never actually any richer than the likes of the uk , netherlands , belguim , germany , it only thought it was due to cheap credit and the property boom , our public sector is paid on average about 25% more than those other countries

somethings got to give

eoinbn

sovtek wrote: »

Then why do all the strongest economies have higher corp tax?

Just guessing:
They have strong indigenise companies with roots. Companies usually continue to have a large presence in the it's home country.

They have much better infrastructure.

Large markets: Toyota can go to the UK and build cars there and market them to 60m people as british made. They probably could get the cars made cheaper in eastern europe but it could cost them market share to Ford/Nissan who also make cars there.

lostexpectation

bit of self fulfilling prophecy then

Darragh29

Well it looks like the decision will be made for us soon enough...

Source: http://www.irishtimes.com/newspaper/breaking/2009/0320/breaking22.htm

Senior German politician Otto Bernhardt was reported this morning as saying euro zone countries have agreed a rescue plan to prevent members of the currency bloc going bankrupt, with Ireland and Greece the most likely candidates for aid.

Bernhardt is a member of Chancellor Angela Merkel's Christian Democrats (CDU) and chairs the party's financial policy group in parliament.

"There is a plan. The finance ministers have agreed the procedures. The core point is: 'We won't let anyone go bust,'" he told Reuters.

Of all the euro zone states, Mr Bernhardt said Ireland was the in the "worst situation of all", followed by Greece. He made clear that any aid would come at a price.

"We would look very closely at past sins," Mr Bernhardt said. "We will not tolerate there being low-tax countries like Ireland for example. We will insist on a minimum corporate taxation rate."

Soldie

So the suggestion seems to be that, should we required a bail-out, we'll be punished by having the linchpin of our economy debilitated. Remarkable.

Otto Bernhardt wrote:

"We are in a position to act within 24 hours. The ECB would take immediate action," he said. "The ECB can make an unlimited amount of money available."

:rolleyes:

Darragh29

Soldie wrote: »

So the suggestion seems to be that, should we required a bail-out, we'll be punished by having the linchpin of our economy debilitated. Remarkable.



:rolleyes:

Well that seems to be the way of it. We will get any assistance we might require, but there will be a price. To be honest it isn't a bad thing, the MNC's here for our low Corporation Tax is just another artificial bubble waiting to burst. We're seeing the effects of the fickleness of MNC's now, only today Dell has announced another 300 odd job losses for Limerick. We shouldn't be relying on these MNC's, that's my view...

turgon

Darragh29 wrote: »

|We shouldn't be relying on these MNC's, that's my view...

What else is there to rely on, may I ask?

Lockstep

Out of interest, what is the EU average for a corporation tax?

Permabear

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Darragh29

turgon wrote: »

What else is there to rely on, may I ask?

I understand your mentality, but it is well within our capabilities to create jobs for ourselves in this country, if we just took a more positive attitude towards those that are able to do so.

ednwireland

indiginous businesses
i have worked for 2 small companies and run my own business in 12 years here and the lack of help and support to build up small businesses is shocking you get screwed by the revenue at every turn, red tape is horrendous, there are some accountancy tricks to write off some tax demands . the company i work had a tax demand (which we cant afford ) last week cant remeber what it was for but it was a demand for this year (which beleive me we wont make a profit). we write software for uk customers have been in business for about 15 years but this gov is only interested in large headline announcements. not in supporting its own industries and trying to make life a little easier.
i can see us moving to the north and getting a pile of grants and help from investni to do so. (we are on the border so wouldnt be that much hassle)
but this gov has ignored its own sme market for 10 years

Darragh29

ednwireland wrote: »

indiginous businesses
i have worked for 2 small companies and run my own business in 12 years here and the lack of help and support to build up small businesses is shocking you get screwed by the revenue at every turn, red tape is horrendous, there are some accountancy tricks to write off some tax demands . the company i work had a tax demand (which we cant afford ) last week cant remeber what it was for but it was a demand for this year (which beleive me we wont make a profit). we write software for uk customers have been in business for about 15 years but this gov is only interested in large headline announcements. not in supporting its own industries and trying to make life a little easier.
i can see us moving to the north and getting a pile of grants and help from investni to do so. (we are on the border so wouldnt be that much hassle)
but this gov has ignored its own sme market for 10 years

Very very true. I run 3 businesses and it is like as if the government have a policy of opposing progress in this country. They are out of touch with reality, they haven't a f*cking clue about enterprise, if it wasn't such a serious matter, it would be a comedy show.

Soldie

Darragh29 wrote: »

Well that seems to be the way of it. We will get any assistance we might require, but there will be a price. To be honest it isn't a bad thing, the MNC's here for our low Corporation Tax is just another artificial bubble waiting to burst. We're seeing the effects of the fickleness of MNC's now, only today Dell has announced another 300 odd job losses for Limerick. We shouldn't be relying on these MNC's, that's my view...

It's a very bad thing, actually. The private sector is what's keeping the country afloat at the moment, and increasing corporation tax is likely to have the effect of reducing the size of the private sector. Our tax revenues are bad enough as it is, they don't need further aggravation.

For what it's worth; do you care to explain how exactly foreign investment is an 'artificial bubble waiting to burst'? The likes of Dell et al. are merely behaving rationally - they're moving to a cheaper location, much like a person might downgrade apartment if they cannot keep up with rent. To diagnose the problem as 'fickleness' just reeks of misguided blame. The real issue that needs to be addressed is the cost of doing business here.

kickoutthejams wrote:

Out of interest, what is the EU average for a corporation tax?

http://en.wikipedia.org/wiki/Tax_rates_of_Europe

Myggel

I would say the low rate of corporation tax is a something which should not be given up ever..

I don't think it's a question of a low or high income tax on MNC profits, it's a question of a low corporation tax on MNC's or no tax at all as they will go elsewhere.

Looking at corporate elite and getting annoyed at them is a simplified way of looking at things. Would 90% be an accurate percentage of coporations employees that are normal rank and file?

The true value of an MNC is not just the tax revenue from it's profits.
It's the employment, training and developing of employees. Look at how much money one MNC can pump into a local economy. Housing, groceries the whole shebang. The most important thing now is to have as many people employed in good jobs as possible.

Germany wants Ireland to lose the low rate as it would make Ireland less competitive. Why would we ever want to lose the edge here? We should be looking at these decisions thinking ' Is this good for Ireland? '. If Germany want to compete, let them drop their corporate tax rate.

Also, it's not taking €80 per week from Gardai and nurses. Look at the pension they receive and what they pay in. Go and calculate how much of their wages they would need to contribute to get an equivalant pension in the private sector. If you get one at all. You could lose your job, your company could go bust or your scheme could be wound up.

How about a new round of benchmarking on pensions?

mickoneill30

Darragh29 wrote: »

"There is a plan. The finance ministers have agreed the procedures. The core point is: 'We won't let anyone go bust,'" he told Reuters.[/B]

This one on Bloomberg
http://www.bloomberg.com/apps/news?pid=20601100&sid=aqhloD_1FAUY&refer=germany

says

"Bernhardt later told Bloomberg he has no personal knowledge of any ECB rescue fund and only “expects” the central bank to step in if needed. "

Permabear

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