Looks like Revenue are in a spot of bother

Piliger

Mr_Red wrote: »

These companies employee people and the government taxes the employees.

they bring great business into the communities like areas in Cork, Kildare , Dublin, Galway and so on.

The EU can go fcuk themselves

Get a grip. You appear to be user the impression that the "EU" objects to our opposes our low tax regime. They don't. The "EU" doesn't have a view. They only have a view on whether we are operating within the regulations and that is a very different thing to our low tax regime. The people that object to our low tax regime are the high tax countries like France and partly Germany etc. But they are not "the EU".

Piliger

Iwasfrozen wrote: »

Thatcher turned Britain's economy around.

Source: http://www.economist.com/blogs/graphicdetail/2013/04/daily-chart-6

She was a massive saviour for the British economy, the middle classes and those who wanted to work instead of spending their days whinging about their entitlements - and she was also a massive benefit to the Irish economy in the same way.

Frank Lee Midere

Piliger wrote: »

They have a wide choice across the northern part of Europe. They would benefit hugely from local infrastructure, while the employment and commercial legal environment would be on a par.

When multinationals make decisions they make them often on what look like tiny margins. Because tiny margins become huge money when they are scaled up.

English speaking is a definite plus, but only a superficial one. Multinationals are operating in a multi lingual environment every day across the globe and whether they move a big factory from Waterford to Belgium won't cause them any real inconvenience. Not on the scale that they operate in.

Most successful multinationals here, especially in the pharma sector, also operate at a level where they can relocate with minimum downside. Being able to do so benefits them enormously when tax changes and commercial legal frameworks change across the globe.

This is what makes our low tax environment so successful and so lucrative for us. Not only do we get the jobs, and the employer's employment taxes, but we also get the commercial cash flow into the country generating almost as many ancillary jobs as there are in the original multinational operation.

Stupid short sighted people focus on the Corporation Tax because they are driven by class warfare and envy, instead of realism and commercial nouse.

I suspect that English speaking is more important than you think. Specially for IT. Learning a new language is a barrier to emigration but most IT workers speak English anyway. So coming to Ireland for a worker isn't a chore. Going to Germany means you need both German and English to work for a company headquartered in the US ( which is what we are talking about here).

Plus unlike other fields you can't just pay low wages, you pay high wages and hope the best emigrate. Ireland is in a relatively good position.

Frank Lee Midere

Piliger wrote: »

She was a massive saviour for the British economy, the middle classes and those who wanted to work instead of spending their days whinging about their entitlements - and she was also a massive benefit to the Irish economy in the same way.

In many ways she was an economic vandal. Britain was workhorse of the world. Now it's the financial capital, a tourist destination and a place for the super rich to park their wealth in property.

steddyeddy

Life in a northern town all the work shut down.

UCDVet

Meh - it's a catch-22.

It's easy to say, 'look at all these multinationals! Not paying taxes!'
But on the flip side, why are a lot of these multinational companies here? Because we gave them great deals on taxes.

I work for a large multinational financial services-type company. They have offices all over the world and they do have staff that are meant to be experts in local tax laws. Whenever there are changes to tax laws, they do a cost/benefit analysis. If they can make more money by moving the office, they will. That's it. It's all about money.

They have moved offices, and the employees that didn't want to/couldn't go to the new office, we left jobless. And they have done it strictly to avoid taxes.

They're in Dublin now because of taxes. They employ a lot of workers though, most of them being well paid positions. That's a lot of income tax and it hits that 51% bracket awfully fast. A good percentage of my co-workers *came* to Dublin to work here, we interview people from all over the world. It's not like another company would just take it's place or that these people would be paying Irish income tax otherwise. That's not the case.

Increasing taxes is a tricky proposition, because as soon as the cost of moving the office is less than the tax difference, they company will leave Dublin just as fast as they came. It'd suck for their employees, people like me would be out of a job - but it's strictly business for them. They don't care either way.

InReality

UCDVet wrote: »

Meh - it's a catch-22.

It's easy to say, 'look at all these multinationals! Not paying taxes!'
But on the flip side, why are a lot of these multinational companies here? Because we gave them great deals on taxes.

I work for a large multinational financial services-type company. They have offices all over the world and they do have staff that are meant to be experts in local tax laws. Whenever there are changes to tax laws, they do a cost/benefit analysis. If they can make more money by moving the office, they will. That's it. It's all about money.

They have moved offices, and the employees that didn't want to/couldn't go to the new office, we left jobless. And they have done it strictly to avoid taxes.

They're in Dublin now because of taxes. They employ a lot of workers though, most of them being well paid positions. That's a lot of income tax and it hits that 51% bracket awfully fast. A good percentage of my co-workers *came* to Dublin to work here, we interview people from all over the world. It's not like another company would just take it's place or that these people would be paying Irish income tax otherwise. That's not the case.

Increasing taxes is a tricky proposition, because as soon as the cost of moving the office is less than the tax difference, they company will leave Dublin just as fast as they came. It'd suck for their employees, people like me would be out of a job - but it's strictly business for them. They don't care either way.

Do you think this would apply to many other MNC's ? I think we could raise a bit more tax on them , not the billions the socialists expect , maybe a few hundred million , before many upped and left.

Piliger

Frank Lee Midere wrote: »

In many ways she was an economic vandal. Britain was workhorse of the world. Now it's the financial capital, a tourist destination and a place for the super rich to park their wealth in property.

Oh yeah the workhouse of the world, where the tax payer was subsidising coal mines and car manufacturers to the tunes of billions every year and rubbish was piling up on the streets and bodies weren't being buried.

Wonderful !

Piliger

Frank Lee Midere wrote: »

I suspect that English speaking is more important than you think. Specially for IT. Learning a new language is a barrier to emigration but most IT workers speak it anyway. So coming to Ireland isn't a chore. Going to Germany means you need both German and English to work for a company headquartered in the US ( which is what we are talking about here).

Plus unlike other fields you can't just pay low wages, you pay high wages and hope the best emigrate. Ireland is in a relatively good position.

All IT people in Germany and most northern European countries speak fluent English.

ted1

Hootanany wrote: »

http://m.independent.ie/business/irish/eu-launches-probe-into-revenue-special-deals-for-multinational-firms-30333572.html


How much of encomamy could be solved if these companies paid their tax

They are paying all taxes that they are obliged to. If we force more taxes there will be 400,000 extra people on the dole

Hootanany

But what about the SME getting a break?

Piliger

Hootanany wrote: »

But what about the SME getting a break?

Are they threatening to move abroad en masse ?

On a broader note yes I do agree that small businesses need to be treated way way better. All during the recession that have been treated like ****, and targeted in an incredible aggressive way by the revenue for example.

Frank Lee Midere

Piliger wrote: »

All IT people in Germany and most northern European countries speak fluent English.

Go back and read what I said again. ( hint I said that. ). I said that it's a given that IT workers speak English so moving to English speaking countries is easy, it isn't a given that they speak french, spainish, Dutch or German. Etc.

Frank Lee Midere

Piliger wrote: »

Oh yeah the workhouse of the world, where the tax payer was subsidising coal mines and car manufacturers to the tunes of billions every year and rubbish was piling up on the streets and bodies weren't being buried.

Wonderful !

Yeah the best thing to do there was to close all that down and not try replace the industry. By the way it was the workhouse of the world for generations.

Piliger

Frank Lee Midere wrote: »

By the way it was the workhouse of the world for generations.

Indeed. The power house anyway

relax carry on

Piliger wrote: »

Are they threatening to move abroad en masse ?

On a broader note yes I do agree that small businesses need to be treated way way better. All during the recession that have been treated like ****, and targeted in an incredible aggressive way by the revenue for example.

Can you elaborate on how Revenue have been incredibly aggressive with small businesses?

awec

steddyeddy wrote: »

Life in a northern town all the work shut down.

Mining was on life support. She turned the life support off. The mines were operating at huge losses and were costing too much.

Iwasfrozen

Frank Lee Midere wrote: »

Yeah the best thing to do there was to close all that down and not try replace the industry. By the way it was the workhouse of the world for generations.

What does a smart owner do with a business that costs more money than it brings in?

Frank Lee Midere

Iwasfrozen wrote: »

What does a smart owner do with a business that costs more money than it brings in?

What does a government do when it is facing the destruction of entire regions and industries? It could let it be, or invest. Germany invested in new technology.

Frank Lee Midere

Iwasfrozen wrote: »

Thatcher turned Britain's economy around.

Source: http://www.economist.com/blogs/graphicdetail/2013/04/daily-chart-6

What do you think you are showing there? Britain from 1970-1979 had the same GDP per capita growth as 79-89

awec

Frank Lee Midere wrote: »

What does a government do when it is facing the destruction of entire regions and industries? It could let it be, or invest. Germany invested in new technology.

Investment would still lead to job losses. The plan was to invest to try and use technology to mechanise the mines more which meant you didn't need as many workers.

Needless to say the miners and their unions resisted this as well.

The mines were costing billions - when you think that this was the 1980s that is a colossal amount of money. It was cheaper to import coal from the likes of Australia than it was to mine it in Britain.

Frank Lee Midere

andrewdeerpark wrote: »

- The global hoarding of cash by corporations is a serious issue as a previous poster said an excellent book from Thomas Piketty required reading.

- Private sector is not suited to certain tasks as they are not capitalist style profitable ventures.

- As for the American Healthcare system just don't get sick without health insurance and when you are sick expect your insurance to be cancelled if you cost to much, again some more reading required.

As far as I read Piketty is really talking about capital accumulations by individuals, more so than corporations. He thinks corporations tend to re0invest although as we have seen from Apple and Google et al. they just have too much money to invest.

Frank Lee Midere

awec wrote: »

Investment would still lead to job losses. The plan was to invest to try and use technology to mechanise the mines more which meant you didn't need as many workers.

Needless to say the miners and their unions resisted this as well.

The mines were costing billions - when you think that this was the 1980s that is a colossal amount of money. It was cheaper to import coal from the likes of Australia than it was to mine it in Britain.

Sure, the miners were a bit intransigent, if you look at how the miners were treated throughout history, or how the British working class has been, particularly up north, then you might see why.

Piliger

relax carry on wrote: »

Can you elaborate on how Revenue have been incredibly aggressive with small businesses?

Running a small business over recent years has meant operating, for most part, close to the edge of profitability and of maintaining sufficient cash to keep the business open. Meeting VAT and other tax commitments has been a huge struggle throughout this period. I have been involved in the SME sector on a financial and negotiating side on and off. The Revenue/Collector General raise excessive tax demands within days of any late payment, slap interest and fines and force the businesses to spend huge amounts of time and professional fees dealing with the issue, never mind the stress and pressure on the business owners. All over relatively small amounts of money.
It is not unusual for the RCG to raise assessments ten times or more larger than amounts really due. This is why I, and people inside the sector, laugh when we see quotes in newspapers of millions of euros in tax unpaid or outstanding. The real figure is a fraction of that.
In my direct experience the bigger the business the less hassle they get from the RCG, which tells you more about the RCG management system and their complete lack of awareness or concern about small business or the fact that SMEs employ most of the employed people in the country.

Calibos

Piliger wrote: »

Running a small business over recent years has meant operating, for most part, close to the edge of profitability and of maintaining sufficient cash to keep the business open. Meeting VAT and other tax commitments has been a huge struggle throughout this period. I have been involved in the SME sector on a financial and negotiating side on and off. The Revenue/Collector General raise excessive tax demands within days of any late payment, slap interest and fines and force the businesses to spend huge amounts of time and professional fees dealing with the issue, never mind the stress and pressure on the business owners. All over relatively small amounts of money.
It is not unusual for the RCG to raise assessments ten times or more larger than amounts really due. This is why I, and people inside the sector, laugh when we see quotes in newspapers of millions of euros in tax unpaid or outstanding. The real figure is a fraction of that.
In my direct experience the bigger the business the less hassle they get from the RCG, which tells you more about the RCG management system and their complete lack of awareness or concern about small business or the fact that SMEs employ most of the employed people in the country.

We'd be at the smallest of the small end of the SME spectrum and are experiencing this intransigence from Revenue. As well as landlord and the Banks of course. If a bucket contains our financial troubles they all add to the contents of the bucket but if only one of them would just bloody be pragmatic the bucket wouldn't be perpetually on the verge of over-flowing. None of them seem to realise that if they demand their full pound of flesh the moment it comes due they could end up getting nothing and never getting anything again because the business will be dead. In terms of Revenue its especially galling because just down the road there is another small business trading that was prosecuted for never paying a cent of VAT to revenue for 9 years. Several Hundred Thousands of euro and yet the proprietor got a suspended sentence and is still trading. We who have never been late in a VAT payment till 2 years ago in 80 years of Trading however are being bent over a barrel by revenue with threats of all sorts all because our profitable business has liquidity problems at certain times of the year. Edge of profitablilty as you say but profitable all the same despite a 40% reduction in Turnover since this economic clusterfcuk started.

It seems revenue want you dead and closed if you are a couple of months in Vat arrears but want you to stay open if you were 9 years in arrears. I suppose its like the old banking analogy. ie. If you owe the bank 10 million or less, they own you. However if you owe the bank 100 million, you own them!!"

Iwasfrozen

Frank Lee Midere wrote: »

What does a government do when it is facing the destruction of entire regions and industries? It could let it be, or invest. Germany invested in new technology.

When those industries are government subsidized and operating at a loss the smart government cuts off the subsidy.

How do you invest in new industries when the people you're dealing with refuse to do anything other than mine and demand the government use other people's money to keep them in a job?

Iwasfrozen

Frank Lee Midere wrote: »

What do you think you are showing there? Britain from 1970-1979 had the same GDP per capita growth as 79-89

Look at UK growth compared to other European countries before during and after Thatcher's tenure.

Frank Lee Midere

Iwasfrozen wrote: »

Look at UK growth compared to other European countries before during and after Thatcher's tenure.

So thatcher reduced European growth? Remarkable.

Iwasfrozen

Frank Lee Midere wrote: »

So thatcher reduced European growth? Remarkable.

Nope she bucked the trend and increased British growth despite falling growth in neighbouring countries.

It's sad that your hatred is blinding you to the facts. At least most Thatcher haters grudgingly accept she was good for growth.

Saadyst

I don't think it would be the worst thing in the world to close off a few loopholes to increase the amount of tax gained from corporations. We know they're not paying the headline 12.5% and it seems to be accepted as in turn they can employ more people (who in turn are taxed more than they might be). However closing a few loopholes to net a couple of hundred million more across the entire base should be possible?

Bog Standard User

yr one wrote: »

All Europe wants is Ireland to share the multi nationals,

start speaking english then... most us companies like speaking english

Buzz Killington the third

Hootanany wrote: »

How much of encomamy could be solved if these companies paid their tax

Imagine how much of the economy could be fixed if religious organisations paid tax!

Fratton Fred

Saadyst wrote: »

I don't think it would be the worst thing in the world to close off a few loopholes to increase the amount of tax gained from corporations. We know they're not paying the headline 12.5% and it seems to be accepted as in turn they can employ more people (who in turn are taxed more than they might be). However closing a few loopholes to net a couple of hundred million more across the entire base should be possible?

I think that's the plan, but to do it in one concerted effort.

Close all the loopholes, everywhere, at the same time and the corporates have nowhere to go, but in theory will stay here for the low tax rate.

Valetta

Saadyst wrote: »

I don't think it would be the worst thing in the world to close off a few loopholes to increase the amount of tax gained from corporations. We know they're not paying the headline 12.5% and it seems to be accepted as in turn they can employ more people (who in turn are taxed more than they might be). However closing a few loopholes to net a couple of hundred million more across the entire base should be possible?

They're not loopholes. They are incentives deliberately introduced to attract foreign companies, as well as to encourage indigenous companies to expand.

The incentives are available to all companies in Ireland, not just multi-nationals.

Why would we reverse these incentives?

The more other countries complain, the more it proves that we are doing the right thing.

Piliger

Buzz Killington the third wrote: »

Imagine how much of the economy could be fixed if religious organisations paid tax!

Wow THAT's an idea ! and maybe if they paid up for the abuse they inflicted. Who is going to pay for the latest round of deaths and drug tests ?

Piliger

Valetta wrote: »

They're not loopholes. They are incentives deliberately introduced to attract foreign companies, as well as to encourage indigenous companies to expand.

The incentives are available to all companies in Ireland, not just multi-nationals.

Why would we reverse these incentives?

The more other countries complain, the more it proves that we are doing the right thing.

Exactly. The problem here is people who know nothing whatsoever about the tax system and why and how incentives work. The media mention 'loopholes' and away they ago like greyhounds after a rabbit ... oops it's not actually a rabbit.

The tax regulations and incentives are under review every single year. They change regularly and are abolished and replaced by others regularly. They are in fact one of the great drivers of the Irish economy since the 1960s, being identified as such by a very imaginative government back then and have been imitated around the world ever since.
Do they get abused from time to time ? of course they do. Like every other aspect of life. But there is no evidence that it is systematic or common.

Fratton Fred

Piliger wrote: »

Do they get abused from time to time ? of course they do. Like every other aspect of life. But there is no evidence that it is systematic or common.

Some bed time reading for you.

http://www.finfacts.ie/irishfinancenews/article_1026675.shtml

http://www.finfacts.com/irelandbusinessnews/publish/article_10005150.shtml

Saadyst

Piliger wrote: »

Exactly. The problem here is people who know nothing whatsoever about the tax system and why and how incentives work. The media mention 'loopholes' and away they ago like greyhounds after a rabbit ... oops it's not actually a rabbit.

The tax regulations and incentives are under review every single year. They change regularly and are abolished and replaced by others regularly. They are in fact one of the great drivers of the Irish economy since the 1960s, being identified as such by a very imaginative government back then and have been imitated around the world ever since.
Do they get abused from time to time ? of course they do. Like every other aspect of life. But there is no evidence that it is systematic or common.

The use of the term 'loopholes' should be obvious in that it refers to rules in the tax system that are being used in manner that the rule wasn't intended for. I'd be very surprised if the tax system is so robust here that corporates are aren't saving substantial amounts by using said 'loopholes'.

If it's the case that Amazon and Apple can make profits in the billions and only pay tax in the double digit millions - due to incentives or regulation - then should it not be a worthwhile exercise to see if the incentives are being used for their original purpose?

I don't think it is morally wrong to avoid paying tax, if you can. Wouldn't we all? But of course we know if everyone was able to avoid tax to the same level as corporations, tax intake would be devastated and virtually non-existent.

When the difference between tax collected and profits made are so vast, you should look at whether the system is fair or not, whether it works effectively or not, and if as a society we're happy to trade the benefits of employment (at high tax rates) in exchange for our employers to make such profit.

Piliger

Fratton Fred wrote: »

Some bed time reading for you.

http://www.finfacts.ie/irishfinancenews/article_1026675.shtml

http://www.finfacts.com/irelandbusinessnews/publish/article_10005150.shtml

Nothing to do with what we were discussing.

Fratton Fred

Piliger wrote: »

Nothing to do with what we were discussing.

Of course it is. It's all part and parcel of the major tax loopholes that the eu want to close.

Piliger

Fratton Fred wrote: »

Of course it is. It's all part and parcel of the major tax loopholes that the eu want to close.

You'll have to tell us which loopholes you are talking about. And for this purpose I would suggest that a loophole is a regulation in the tax code that is being used for purposes for which it was not intended ?

Fratton Fred

Piliger wrote: »

You'll have to tell us which loopholes you are talking about. And for this purpose I would suggest that a loophole is a regulation in the tax code that is being used for purposes for which it was not intended ?

If the Dutch/Irish sandwich was meant as a way corporates can reduce their tax bill from 12% to 2%, then why not just have a 2% tax rate?

Piliger

Fratton Fred wrote: »

If the Dutch/Irish sandwich was meant as a way corporates can reduce their tax bill from 12% to 2%, then why not just have a 2% tax rate?

And where exactly does Ireland lose out ?

Frank Lee Midere

Iwasfrozen wrote: »

Nope she bucked the trend and increased British growth despite falling growth in neighbouring countries.

It's sad that your hatred is blinding you to the facts. At least most Thatcher haters grudgingly accept she was good for growth.

I am not seeing any facts. You are merely speculating about counter factuals. The fact is - the only actual fact is - that the UK grew as much in the Keynesian 70's as it did it the Thatcherite 80's. Despite her pro cyclical boom shenanigans, which of course caused a bust just after she left. The future she left was a Britain devoid of manufacturing and with large social housing deficits - the full results of that have yet to play out.

Frank Lee Midere

Piliger wrote: »

And where exactly does Ireland lose out ?

Ireland doesn't probably lose out. Arguably the US loses out. But it's odd isn't it that rich economic actors pay 2% and I pay 52% marginal, 35% in total.

Piliger

Frank Lee Midere wrote: »

Ireland doesn't probably lose out. Arguably the US loses out. But it's odd isn't it that rich economic actors pay 2% and I pay 52% marginal, 35% in total.

In that case on what basis is it being referred to as a loophole ?

And, at the risk of attracting a load of abuse, I really don't know what all of this utter BS is about what tax corporations/companies pay. In my view companies should not pay ANY tax.

The profits that companies make is distributed to the people who own the shares and they pay full income taxes wherever they are. I see no justification for double taxing them. It is anti jobs and limits innovation, business activity and growth imho. Companies already pay 10+% employment taxes, as well as generating VAT and other taxes. Why anyone should compare themselves with a company is totally beyond me.

Iwasfrozen

Frank Lee Midere wrote: »

I am not seeing any facts. You are merely speculating about counter factuals. The fact is - the only actual fact is - that the UK grew as much in the Keynesian 70's as it did it the Thatcherite 80's. Despite her pro cyclical boom shenanigans, which of course caused a bust just after she left. The future she left was a Britain devoid of manufacturing and with large social housing deficits - the full results of that have yet to play out.

Thatcher turned Britain from being the lowest performing major nation to the highest but you won't even acknowledge that because you have an ideological block.

Fratton Fred

Piliger wrote: »

In that case on what basis is it being referred to as a loophole ?

And, at the risk of attracting a load of abuse, I really don't know what all of this utter BS is about what tax corporations/companies pay. In my view companies should not pay ANY tax.

The profits that companies make is distributed to the people who own the shares and they pay full income taxes wherever they are. I see no justification for double taxing them. It is anti jobs and limits innovation, business activity and growth imho. Companies already pay 10+% employment taxes, as well as generating VAT and other taxes. Why anyone should compare themselves with a company is totally beyond me.

Why should anyone pay tax then?

poppyvally

does anyone know what it's like to work in some of these multinational places I've heard of ppl lined up on both sides of the conveyor belt doing the same thing over & over & over every shift of their working lives. like robots which will eventually replace them anyway. Soul destroying! but what's the alternative?

Piliger

poppyvally wrote: »

does anyone know what it's like to work in some of these multinational places I've heard of ppl lined up on both sides of the conveyor belt doing the same thing over & over & over every shift of their working lives. like robots which will eventually replace them anyway. Soul destroying! but what's the alternative?

That's a gross distortion of work in a multinational. What are you thinking of ? canning baked beans or something ?