Germany warns Greeks it won't be blackmailed in election

BoatMad

mollymosfet wrote: »

Politics is largely based on selling people an idea, and that involves a certain degree of deception. In particular, the branch of economics practiced by the likes of the Troika, influenced by the Austrian school, almost always goes hand in hand with scare tactics and manipulation of the public conscience.

I was scared by the mess we got ourselves into, I certainly was not scared by the Troika, in fact the country seemed quite content to have some else to tell them what to do, generations of colonial thinking isn't washed away in a few decades it seems.

what " scare tactics" did the so-called Troika engage in by the way

Rightwing

BoatMad wrote: »

cloud cuckoo land , your living in , irish companies provide " tens of thousands " of jobs in the US .... come of it.

Why do you see your own country as "cowboy places". why does the looney left want to dismantle this nation to simply prove a point

Check the facts. Then I can continue.

BoatMad

Rightwing wrote: »

Check the facts. Then I can continue.

I stand corrected 82,000 jobs, it seems, it in no way validates your comments

82,000 is a drop in the ocean in the US, 100-150 K jobs that US provides here is a lifeline.

again why denigrate your own country

Rightwing

BoatMad wrote: »

I stand corrected 82,000 jobs, it seems, it in no way validates your comments

82,000 is a drop in the ocean in the US, 100-150 K jobs that US provides here is a lifeline.

again why denigrate your own country

US/UK/EU all think our tax model is wrong. Can they all be wrong, and the likes of ouselves and Bahamas be right?

US company profits per Irish employee at $970,000; Tax paid in Ireland at $25,000

http://www.finfacts.ie/irishfinancenews/article_1026577.shtml

BoatMad

Rightwing wrote: »

US/UK/EU all think our tax model is wrong. Can they all be wrong, and the likes of ouselves and Bahamas be right?

US company profits per Irish employee at $970,000; Tax paid in Ireland at $25,000

http://www.finfacts.ie/irishfinancenews/article_1026577.shtml

yes they are wrong, because they get virtually no US FDI.

profits per employee is a nonsense metric

Rightwing

BoatMad wrote: »

yes they are wrong, because they get virtually no US FDI.

profits per employee is a nonsense metric

No,,,,because they will have to bail/loan Ireland out again. I appreciate it's a complex subject and many will be unable grasp it.

BoatMad

Rightwing wrote: »

No,,,,because they will have to bail/loan Ireland out again. I appreciate it's a complex subject and many will be unable grasp it.

to suggest that Ireland could get significantly more tax from companies is nonsense. far better to get it from the indirect taxes such companies generate.

equally to further suggest that this policy will causes future bailouts , given that this particular policy didn't cause the last one ( or the one before that) is equally nonsense

to claim you and only you have a handle on a complex subject is of course complete nonsense

Ill simplify it for you , 12.5% of something is better then 28% of nothing


this leaves aside the whole issue of EU countries effective rate of taxation of companies , see france

Rightwing

BoatMad wrote: »

to suggest that Ireland could get significantly more tax from companies is nonsense. far better to get it from the indirect taxes such companies generate.

equally to further suggest that this policy will causes future bailouts , given that this particular policy didn't cause the last one ( or the one before that) is equally nonsense

to claim you and only you have a handle on a complex subject is of course complete nonsense

Ill simplify it for you , 12.5% of something is better then 28% of nothing


this leaves aside the whole issue of EU countries effective rate of taxation of companies , see france

You see, the problem is, there is no 12.5%. Hence the 'profits per Irish employee at $970,000; Tax paid in Ireland at $25,000'

BoatMad

Rightwing wrote: »

You see, the problem is, there is no 12.5%. Hence the 'profits per Irish employee at $970,000; Tax paid in Ireland at $25,000'

Ive read the fin facts too.

most of that untaxed amounts are activities that are not based in this country and companies are using Irelands generous transfer pricing and profit transfer rules to avoid tax.

However , ( as is the reason for its sensitivities), this missing tax will never end up in ireland, its rightly tax that is being evaded in the UK or the USA or elsewhere.

You might say that Irish tax laws are allowing companies here to avoid tax elsewhere and in that regard Ireland is clearly a tax haven,

However removing this practice might benefit others, it would not benefit us. this is the main reason some EU countries want ireland to modify its tax laws.

Piliger

Rightwing wrote: »

http://www.finfacts.ie/irishfinancenews/article_1026577.shtml

A deeply biased and politically selective source.

Rightwing

Piliger wrote: »

A deeply biased and politically selective source.

Perhaps, but it raises issues that need to be addressed.

Saipanne

If we could get away with it, I would set the rate to zero.

Qualitymark

Saipanne wrote: »

If we could get away with it, I would set the rate to zero.

Yes, Mr Haughey.

Saipanne

Qualitymark wrote: »

Yes, Mr Haughey.

What an incredibly stupid post.

mollymosfet

BoatMad wrote: »

I was scared by the mess we got ourselves into, I certainly was not scared by the Troika, in fact the country seemed quite content to have some else to tell them what to do, generations of colonial thinking isn't washed away in a few decades it seems.

what " scare tactics" did the so-called Troika engage in by the way

Um, pressuring us into the bailout in the first place? Convincing us we needed their plans when the IMF has left a trail of destruction behind them?

Rightwing

mollymosfet wrote: »

Um, pressuring us into the bailout in the first place? Convincing us we needed their plans when the IMF has left a trail of destruction behind them?

We had to be bailed out, irrespective of what our politicians say.

That was there long before the IMF ever came in.

Qualitymark

Rightwing wrote: »

We had to be bailed out, irrespective of what our politicians say.

That was there long before the IMF ever came in.

But surely not taking on bankers' debts as sovereign debt when the bankers had not been truthful about the extent of their indebtedness and risk.

Wurzelbert

BoatMad wrote: »

Just like its suits the US to have trade denominated in dollars, it mighty suits the German economy to have trade carried out in Euros, The alternative would have been a rapidly appreciating Dmark and with it the difficulties in selling high value service and products that the German economy does well.

For example BMW will benefit if its customers deal in the same currency it does , thats obvious, it suffers greatly if its say French customers, now can't afford to buy the same car, cause they have Francs.

while this is clear to german business people and politicians, its perhaps loess clear to the average german , who like many Europeans has had a bad job of having it explained to them.

Some of the problems baked into the Euro are directly tied to German obsessions about inflation and rogue currencies, its a powerful race memory. However those concerns have directly hampered the ECB in trying to deal with the current recession and the recent issues with banks and the Euro.

Its worth noting that the ECB has managed to wriggle quite successfully in recent times around those restrictions, which means in general the German political classes know what has to be done , even if the public don't.

thank you, i understand the basics of exchange rates and all…yet as i said before, bmw and all the others were doing just grand before the euro, you might consider having a look at germany’s foreign trade statistics since 1950 or so…though - in theory - you of course have a point with a stronger d-mark…
the thing is that the whole “euro love” sold to us by our politicians is just a political phenomenon and is being promoted and organised by those who run the show…keep in mind that germany is not really a sovereign nation – like the us or uk would be - to this day and is in its current form a compromise in many ways…the euro was not chosen by the germans, it was sort of forced upon them…

Rightwing

Qualitymark wrote: »

But surely not taking on bankers' debts as sovereign debt when the bankers had not been truthful about the extent of their indebtedness and risk.

It's not that easy. Every country in the world wouldn't take on bank debt if it was that easy. We guaranteed all debt. Yes, we should have let Anglo and Ir Nationwide go, but they were our mistakes, no one elses.

Qualitymark

Rightwing wrote: »

It's not that easy. Every country in the world wouldn't take on bank debt if it was that easy. We guaranteed all debt. Yes, we should have let Anglo and Ir Nationwide go, but they were our mistakes, no one elses.

They were the mistake of the Irish upper classes, chinless wonders that they are - the politicians who inherit their daddies' seats.

The Corinthian

Qualitymark wrote: »

They were the mistake of the Irish upper classes, chinless wonders that they are - the politicians who inherit their daddies' seats.

Irish upper classes. LOL. Third generation potato farmers with a patio and a Jesuit education.

jimgoose

The Corinthian wrote: »

Irish upper classes. LOL. Third generation potato farmers with a patio and a Jesuit education.

<SNORT> :pac::pac::pac:

Kermit.de.frog

Rightwing wrote: »

You see, the problem is, there is no 12.5%. Hence the 'profits per Irish employee at $970,000; Tax paid in Ireland at $25,000'

Ok lets say you take Intel, Pfizer and Google as just 3 examples - they employ between them around 17,000 people in mostly high paid positions.

Now let's say you go to them and say pay 12.5% tax but they say "no" and tell you blunty Irish talent sucks, Irish infrastructure sucks and we could not care less about your green land - all we care about is lower taxes and we can easily up sticks in the morning.

What do say then? Are you going to tell them to leave?

It comes down to a basic selfish point. Are we better off having these companies here paying something and providing employment and research and development.

OR

Should we shoot ourselves in the head at the behest of jealous and antagonised neighbours who want to take our lunch and couldn't give a toss about the morals themselves.

I'll go with option A.

Every country in the world looks after their vital interests. Ours is keeping these companies here and attracting more.

bb1234567

KomradeBishop wrote: »

Greece are using the Euro as their currency, so when they leave the EU, they have to transition to a new local currency - this is an incredibly chaotic and destructive event, which will result in large-scale capital flight, and possibly economic sanctions since they will effectively be defaulting their debts by redenominating them.

However, that's only destructive in the short/medium-term; staying in Europe means the long-term destruction of their economy/country/democracy effectively, and an exit means a lot of short/medium-term economic destruction, with a return to fully sovereign democracy and economic recovery down the line.

They should have left Europe 5-7 years ago; if they leave now, and Ireland stays in Europe, it could easily happen that Greece may well fully recover within a decade, with Ireland still plodding along with economic stagnation (don't believe anyone who says we are 'recovering' - Europe is about to slip into deflation, and we're all fúcked then, as that means Japanese-style multiple lost decades).


If this party gets voted in, Greece will finally be showing some balls. The economic policies forced upon them, have destroyed their country - and by exiting Europe, they can regain the control needed, to start the (long and slow) effort towards true recovery.

Greeces birth rate is so low the economy will be crippled again in about 50 years unless it picks up drastically. same with germany. And nearly all of the EU for that matter.

Piliger

bb1234567 wrote: »

Greeces birth rate is so low the economy will be crippled again in about 50 years unless it picks up drastically. same with germany. And nearly all of the EU for that matter.

Assuming that current trends will continue for 50 years is rather naive.

Rightwing

Kermit.de.frog wrote: »

Ok lets say you take Intel, Pfizer and Google as just 3 examples - they employ between them around 17,000 people in mostly high paid positions.

Now let's say you go to them and say pay 12.5% tax but they say "no" and tell you blunty Irish talent sucks, Irish infrastructure sucks and we could not care less about your green land - all we care about is lower taxes and we can easily up sticks in the morning.

What do say then? Are you going to tell them to leave?

It comes down to a basic selfish point. Are we better off having these companies here paying something and providing employment and research and development.

OR

Should we shoot ourselves in the head at the behest of jealous and antagonised neighbours who want to take our lunch and couldn't give a toss about the morals themselves.

I'll go with option A.

Every country in the world looks after their vital interests. Ours is keeping these companies here and attracting more.

Your argument is flawed. These companies know at 12.5% they are getting a serious deal. But they also know it's easy trick the Irish. Demand 2% and the paddy will quickly buckle.

It's like saying, ask a consultant will they pay 20% tax, if he says 'no' and leaves we are fcuked.

Piliger

Rightwing wrote: »

Your argument is flawed. These companies know at 12.5% they are getting a serious deal. But they also know it's easy trick the Irish. Demand 2% and the paddy will quickly buckle.

It's like saying, ask a consultant will they pay 20% tax, if he says 'no' and leaves we are fcuked.

It's hard to know where to start with this level of comment. I see nothing but blind prejudice and total ignorance of how the tax system is operated here, what taxes most of these companies pay and what benefits ensue to our people. When you make such scathing and bigoted accusations it would be better if you had some evidence to back it up or even support it ever so slightly.

Rightwing

Piliger wrote: »

It's hard to know where to start with this level of comment. I see nothing but blind prejudice and total ignorance of how the tax system is operated here, what taxes most of these companies pay and what benefits ensue to our people. When you make such scathing and bigoted accusations it would be better if you had some evidence to back it up or even support it ever so slightly.

Facts can't be trumped by IDA apologists.

Evidence?? :rolleyes:
You must be having a laugh or else I'm wasting my time. I suspect the latter.
Google pays just 0.14% tax in seven years

Global giant paid less than €70m in tax on sales of €47bn through its Irish operations

http://www.independent.ie/business/irish/google-pays-just-014-tax-in-seven-years-28945199.html



Or
Facebook paid corporate tax of €2.3m as revenue hit €3bn

http://www.independent.ie/business/technology/facebook-paid-corporate-tax-of-23m-as-revenue-hit-3bn-30800704.html

Or
Apple confirms 2% tax rate for two Irish subsidiaries

http://www.rte.ie/news/business/2013/0521/451564-apple-tax-arrangements/

Qualitymark

Another theory is that if Germany left the Eurozone and went back to the deutschmark, Europe would swing rapidly out of recession.

Piliger

Rightwing wrote: »

Facts can't be trumped by IDA apologists.

Evidence?? :rolleyes:
You must be having a laugh or else I'm wasting my time. I suspect the latter.
Google pays just 0.14% tax in seven years

Global giant paid less than €70m in tax on sales of €47bn through its Irish operations

http://www.independent.ie/business/irish/google-pays-just-014-tax-in-seven-years-28945199.html



Or
Facebook paid corporate tax of €2.3m as revenue hit €3bn

http://www.independent.ie/business/technology/facebook-paid-corporate-tax-of-23m-as-revenue-hit-3bn-30800704.html

Or
Apple confirms 2% tax rate for two Irish subsidiaries

http://www.rte.ie/news/business/2013/0521/451564-apple-tax-arrangements/

The concept of paying tax on turnover rather than profits is a joke. And your 'evidence' is made up of politically biased journalists reports.... wow.

K-9

Rightwing wrote: »

Your argument is flawed. These companies know at 12.5% they are getting a serious deal. But they also know it's easy trick the Irish. Demand 2% and the paddy will quickly buckle.

It's like saying, ask a consultant will they pay 20% tax, if he says 'no' and leaves we are fcuked.

The rate isn't really what is attractive about our tax policy, it's the rules. Ireland has facilitated, and it could well be argued though the authorities will deny it, actively encouraged things like the double Irish. Sure we had the ridiculous situation that a Apple company was resident nowhere, out in the mid Atlantic somewhere apparently!

Things like brass plate companies with no employees have been cracked down on, exactly because they were indefensible, by anybody! Though no doubt a few right wingers and libertarians will still take issue with that!

The attitudes of Haughey and FF in the Charlie film are very much alive in modern day Ireland, sometimes written down in tax law!

Which goes back to burning bondholders and that. When we've a Government heavily dependent on multinationals and an economy that actively facilitates and attracts them, Governments don't want to upset them in anyway.

Rightly or wrongly, that is the way they look at it. We've an electorate in some way complicit with that, the 12.5% tax rate is held up as nearly some type of nationalistic resource at times!

Piliger

K-9 wrote: »

The rate isn't really what is attractive about our tax policy, it's the rules. Ireland has facilitated, and it could well be argued though the authorities will deny it, actively encouraged things like the double Irish. Sure we had the ridiculous situation that a Apple company was resident nowhere, out in the mid Atlantic somewhere apparently!

Things like brass plate companies with no employees have been cracked down on, exactly because they were indefensible, by anybody! Though no doubt a few right wingers and libertarians will still take issue with that!

The attitudes of Haughey and FF in the Charlie film are very much alive in modern day Ireland, sometimes written down in tax law!

Which goes back to burning bondholders and that. When we've a Government heavily dependent on multinationals and an economy that actively facilitates and attracts them, Governments don't want to upset them in anyway.

Rightly or wrongly, that is the way they look at it. We've an electorate in some way complicit with that, the 12.5% tax rate is held up as nearly some type of nationalistic resource at times!

And it is the country and our people that have benefited. I see absolutely nothing wrong with what we have done with our tax system, something that lots of countries have done and a lot 'worse' goes on in those countries that throw muck at us.

Dozens of the top corporations in the US pay negative tax, they get so much in subsidies that it outweighs the tiny tax they pay. This kind of thing goes on everywhere.

We need to stick with our attractive tax system and keep and attract as many multinationals and big corporations here as we possibly can. They pour millions into the country, pay millions in employee taxes and allow us to live at the standard of living that we do.

Magico Gonzalez

Has anyone ever calculated the tax that these companies should pay if they adhered to the 12.5 vs the amount of money they pump into the economy in salaries, 3rd party services purchased, hotel, air fares etc.

I am wondering whether the cash injection into the Irish economy is not more important than the tax take, maybe not?

Piliger

Magico Gonzalez wrote: »

Has anyone ever calculated the tax that these companies should pay if they adhered to the 12.5 vs the amount of money they pump into the economy in salaries, 3rd party services purchased, hotel, air fares etc.

I am wondering whether the cash injection into the Irish economy is not more important than the tax take, maybe not?

It's an academic issue though .. It assumes that none of them pay the 12.5, and they would all stay if they were all forced to pay the full 12.5. There is evidence whatsoever that the revenue and government are not doing their damnedest to find the right balance between getting the most in taxes and attracting the greatest numbers of jobs.

Magico Gonzalez

Piliger wrote: »

It's an academic issue though .. It assumes that none of them pay the 12.5, and they would all stay if they were all forced to pay the full 12.5. There is evidence whatsoever that the revenue and government are not doing their damnedest to find the right balance between getting the most in taxes and attracting the greatest numbers of jobs.

OK, still would be interesting to understand how much the actual tax take is worth vs the liquidity provided to the economy via salaries, payments to suppliers and other revenue (business travel etc).

There is no evidence whatsoever that the revenue / govt are not doing their damndest to ensure the 12.5% figure is not a PR statement and that they are content to prolong the "double irish" etc.

Not saying that they should change strategy, but the debate of salaries, income tax, other revenue vs corporate tax is being played out in public in a vacuum without meaningful figures.

Piliger

Magico Gonzalez wrote: »

OK, still would be interesting to understand how much the actual tax take is worth vs the liquidity provided to the economy via salaries, payments to suppliers and other revenue (business travel etc).

There is no evidence whatsoever that the revenue / govt are not doing their damnedest to ensure the 12.5% figure is not a PR statement and that they are content to prolong the "double irish" etc.

Not saying that they should change strategy, but the debate of salaries, income tax, other revenue vs corporate tax is being played out in public in a vacuum without meaningful figures.

I agree to some extent. There is an ocean of misinformation and people using newspaper journalists as references and the comical usage of 'revenue' to argue about taxes.

But common sense also comes into play. If a corporation employees 3,000 highly paid people here with an average salary of €50k say, then they pay a ballpark of 3,000 x 50,000 x 10% = €15Million a year whether they make any profit or not.
Add to that the spin off spending by the company here and the small businesses they support.
Left wing dogma always purposely exaggerate what they think they can 'screw' out of businesses. but the truth is that low taxes encourages investment, growth, innovation and generates even higher taxes. If we applied the tax system they have in France, we would probably lose 90% of the multinational jobs here, which would move to countries like France where they have the advantage of being at the heart of Europe.

Geuze

Magico Gonzalez wrote: »

Has anyone ever calculated the tax that these companies should pay if they adhered to the 12.5 vs the amount of money they pump into the economy in salaries, 3rd party services purchased, hotel, air fares etc.

I am wondering whether the cash injection into the Irish economy is not more important than the tax take, maybe not?

These MNC companies do pay 12.5% CT on their profits earned in Irl.

These other profits are from elsewhere, and travel through Irl, to somewhere else.

That's one reason why they aren't liable to Irish CT.

This may help explain it:

http://economic-incentives.blogspot.ie/2014/03/who-is-to-blame-for-asis-effective-tax.html

BoatMad

mollymosfet wrote: »

Um, pressuring us into the bailout in the first place? Convincing us we needed their plans when the IMF has left a trail of destruction behind them?

sorry

* state guarantees banks
* state can't actually meet banks losses
* state running deficit anyway
* state now can't now borrow itself - state bust.
* state needs emergency money
* state accepts Troika bailout

Just who needs who here.

BoatMad

K-9 wrote: »

The rate isn't really what is attractive about our tax policy, it's the rules. Ireland has facilitated, and it could well be argued though the authorities will deny it, actively encouraged things like the double Irish. Sure we had the ridiculous situation that a Apple company was resident nowhere, out in the mid Atlantic somewhere apparently!

Things like brass plate companies with no employees have been cracked down on, exactly because they were indefensible, by anybody! Though no doubt a few right wingers and libertarians will still take issue with that!

The attitudes of Haughey and FF in the Charlie film are very much alive in modern day Ireland, sometimes written down in tax law!

Which goes back to burning bondholders and that. When we've a Government heavily dependent on multinationals and an economy that actively facilitates and attracts them, Governments don't want to upset them in anyway.

Rightly or wrongly, that is the way they look at it. We've an electorate in some way complicit with that, the 12.5% tax rate is held up as nearly some type of nationalistic resource at times!

There are two different things mixed today, as you point out

the first, is that Ireland has a very generous policy on transfer pricing and allows companies to move profit incurred outside ireland, with incurring irish tax. This is in stark contrast to the US policy for example.


The second , is that, actually as a result of EU pressure , corporate tax rates in Ireland where harmonised to 12.5% , from before where there was a 10% manufacturing tax and ( i think) a 28% other tax.


The first case, encourages US firms to base their HQ here and back office, admin, etc, removing that tax code advantage, wouldn't gain us a single penny more in tax, as in fact that tax actually other countries tax money.


The second one, keeps companies who employ people here , here.

The Corinthian

mollymosfet wrote: »

Um, pressuring us into the bailout in the first place? Convincing us we needed their plans when the IMF has left a trail of destruction behind them?

Well, we did. The moment we decided (and whether it was a good idea or not is a separate matter) to guarantee the banks, we pretty much had to follow their plans as we needed their money. They didn't have to convince anyone; we desperately wanted the money so they got to call the terms.

That we decided to guarantee the banks was ultimately our decision. If you'll remember, there was a real danger of a collapse of the banking system - you know the account where you get your salary / college grant / money from mommy and daddy lodged? Poof - it was going to be gone.

We could debate all the pros and cons with the benefit of hindsight on whether we should have done so or did so in the best way, but at the end of the day we chose to do so before anyone in Brussels or Berlin demanded we follow any plan.

The Corinthian

BoatMad wrote: »

The second , is that, actually as a result of EU pressure , corporate tax rates in Ireland where harmonised to 12.5% , from before where there was a 10% manufacturing tax and ( i think) a 28% other tax.

The hilarious thing is that it was just a lazy way of harmonizing tax when it was implemented. It took a further five years or so before we even started cottoning on to the fact that it was attractive to foreign companies.

The most successful economic policy in the history of the State was an accident.

BoatMad

The Corinthian wrote: »

The hilarious thing is that it was just a lazy way of harmonizing tax when it was implemented. It took a further five years or so before we even started cottoning on to the fact that it was attractive to foreign companies.

The most successful economic policy in the history of the State was an accident.

I wouldn't agree with that

At that time many companies fell under the 10% manufacturing rule ( as revenue was fairly lenient ) and that included the FDI companies, which were invariably manufacturing based at the time. The impact of a significant upwards revision of corporate tax would have been very damaging. Clearly the EU was not expecting the Irish Government to give the 28% companies a freebie, which it did much to the EUs annoyance

It wasn't an accident, the 10% was already there for many years.

Idbatterim

If we hadn't nationalised anglo and Irish Nationwide, would that have been enough to avoid the bailout potentially?

Convincing us we needed their plans when the IMF has left a trail of destruction behind them?

We are obviously disappointed with them for different reasons, mine is that virtually nothing changed, deck chairs were rearranged on the titanic. Is that the trail of destruction you were referring to? tens of billions more borrowed to keep welfare rates for example, pretty much as they were?

BoJack Horseman

Idbatterim wrote: »

If we hadn't nationalised anglo and Irish Nationwide, would that have been enough to avoid the bailout potentially?

No, the primary deficit was too high & bond rates too high to finance it.

Bailout was inevitable.

BoatMad

BoJack Horseman wrote: »

No, the primary deficit was too high & bond rates too high to finance it.

Bailout was inevitable.

I dont agree with that , The state had no trouble on the bond market financing the pre -guarantee budget deficit.

BoJack Horseman

BoatMad wrote: »

I dont agree with that , The state had no trouble on the bond market financing the pre -guarantee budget deficit.

Just shy of €50 billion was borrowed between 2008 & 2011 for running the state alone.

Before the guarantee, bond rates were pushing 6% anyway.

Add to that the cost of recapitalisation of the pillar banks

Even ommiting Anglo, the mountain of new debt would have been too big to borrow on the markets at an affordable rate

Idbatterim

Just shy of €50 billion was borrowed between 2008 & 2011.

Before the guarantee, bond rates were pushing 6% anyway.

Add to that the cost of recapitalisation of the pillar banks

Even ommiting Anglo, the mountain of new debt would have been too big to borrow on the markets at an affordable rate

In addition to this, as it turns out the government had no stomach to make any form of significant cuts even with the bailout, actually the bailout allowed them to get away with this. so I reckon they would have entered the bailout, before they would have cut spending / increased taxes enough to avoid rates going to unsustainable levels...

The Corinthian

BoatMad wrote: »

It wasn't an accident, the 10% was already there for many years.

What was there was introduced due to demands by the then EEC to remove export relief, which was viewed as discriminatory and later became the 12.5% we know today. It was only after it's introduction that it was discovered that foreign companies (80% of those questioned) cited it as a major reason to base themselves in Ireland.

Point is that this rate was not originally designed to attract FDI and it's effects were originally unintentional.

Colinf1212

Kermit.de.frog wrote: »

I hope the left parties do win in Greece later in the month so other PIIGS like Ireland can see the consequences of electing people with no real ideas or alternatives.

PIIGGS*

K-9

The Corinthian wrote: »

What was there was introduced due to demands by the then EEC to remove export relief, which was viewed as discriminatory and later became the 12.5% we know today. It was only after it's introduction that it was discovered that foreign companies (80% of those questioned) cited it as a major reason to base themselves in Ireland.

Point is that this rate was not originally designed to attract FDI and it's effects were originally unintentional.

My recollection is McCreevey gradually phased it down to 12.5% over about 5 years, from 32%, though it could well have been initially suggested by the Rainbow coalition.

I doubt they just "came upon it", the IFSC had a 10% tax as an incentive, the export relief that was scrapped became a 10% rate as well, so a low CT policy for foreign multinationals was long established by the time they introduced the 12.5% standard rate.