Ireland’s Corporation Tax, at 12.5 percent, is amongst the lowest in Europe where the average Corporation Tax rate now stands at 21.5 percent compared with a global average of 25 percent.
In the Eurozone – only Cyprus and Bulgaria (10%) have lower rates than Ireland .
In comparison – UK corporation tax will fall to 24 percent over the next four years while in France it is 33.3 percent and in Germany 29.41 percent
The low rate of Irish corporation tax has attracted many global companies such as Google, Microsoft, Intel , HP, Amazon, Ebay,Facebook, United Business Media and Shire Pharmaceuticals.
The 12.5% corporation tax rate remains a cornerstone of Irish industrial policy and the government are adamant that it will remain low – and will fight to ensure that raising it will not be a condition of renegotiating the interest rates of the EU bailout.
It is estimated that raising Corporation Tax in Ireland by just 1.5% to 14% would net the government a total of €1.5bn a year.
A rise to the global average of 25% could bring in around €12.5bn a year.
It is understandable though – that other countries who are contributing to the Irish rescue package could see their money as effectively helping to pay extra profits to the bosses and shareholders of companies like Microsoft and Google while cuts are made to things like minimum wage levels and social welfare.