Leprechaun Economics - Ireland the Tax Haven
Discussion
Iti s common knowledge that Ireland has attracted many big international companies to base themselves there by setting low corporatr tax rates. No doubt other factors like an English speaking eductated workforce also play a part but money talks.
I hadn't given any thought to the drawbacks. This article points out a few.
"GDP per head in Ireland is measured by the Irish government – and accepted by international organisations – as being 91 per cent higher than the UK, indicating at face value that Ireland is almost twice as rich as the UK. But this is a travesty of reality."
"The distortions are due to the vast volumes of profits of multi-national companies sloshing through Ireland but not earned or spent there. "
As payments to many EU budgets are based on GDP Ireland is now a net contributer with the amount per head going to be around what the UK was paying.
Well worth reading the whole thing.
https://briefingsforbritain.co.uk/distorted-irish-...
I hadn't given any thought to the drawbacks. This article points out a few.
"GDP per head in Ireland is measured by the Irish government – and accepted by international organisations – as being 91 per cent higher than the UK, indicating at face value that Ireland is almost twice as rich as the UK. But this is a travesty of reality."
"The distortions are due to the vast volumes of profits of multi-national companies sloshing through Ireland but not earned or spent there. "
As payments to many EU budgets are based on GDP Ireland is now a net contributer with the amount per head going to be around what the UK was paying.
Well worth reading the whole thing.
https://briefingsforbritain.co.uk/distorted-irish-...
It s a precarious situation. Even if you ignore that Irelands headline rate is half that of the average OECD, and ranks in amongst the least developed nations globally - the real problem facing Ireland is what happens if the UK goes full Singapore on Thames....
Currently, total Irish tax receipts have an exceptionally high dependency on Corporation Tax. Up to 16% of the total Tax take is derived from CT (with 80% concentration around a few firms - that only employ 25% of the workforce). The UK is only 8%, US is 7%.
With such high concentration risk AND macro jurisdiction risk, a race to the floor on tax rates can be exceptionally damaging to the Irish Tax take. Much more so than EC contribution inflation.
If the upshot of an increasingly antagonistic Brexit is aggressive tax posturing (and that's a pretty likely outcome), it could be a proper kick in Ireland's sponge - especially as the EC, ECJ is doing it all it can to shut down the wheeze's. It's a fallacy that the UK is going to sit on it's hands post (No Deal Brexit). It's the big fear. Every "Remain" projection has been backward looking NOT forward, not modelling outcomes is a very poor strategy going into the debate (and one where Merkel has been vocal - but not intervening).
IF such a scenario is to emerge, all the piffle about exports and where the border is going to look like a Puffin Club debate (to the Irish economy); and expose the total failure of EC diplomacy (which should have been to keep the UK on side). Letting the UK start running around the world like a loose cannon, especially on this stuff - IS the stuff of nightmares for the EU nations (it would be similar if we start ramping tech subsidy into orbit - it's not the volume of cars for Germany but Industrial complexity gauge - something that Corona is sticking on warp speed). If they think they can deal now given where we are is largely jokes; it would be like the EC going for a 1 on 1 straightner with Francis Begby.
Sitting in Ireland right now, must be a bit like cold war Germany. If either side rolls on the over, it won't be a pretty sight.
Currently, total Irish tax receipts have an exceptionally high dependency on Corporation Tax. Up to 16% of the total Tax take is derived from CT (with 80% concentration around a few firms - that only employ 25% of the workforce). The UK is only 8%, US is 7%.
With such high concentration risk AND macro jurisdiction risk, a race to the floor on tax rates can be exceptionally damaging to the Irish Tax take. Much more so than EC contribution inflation.
If the upshot of an increasingly antagonistic Brexit is aggressive tax posturing (and that's a pretty likely outcome), it could be a proper kick in Ireland's sponge - especially as the EC, ECJ is doing it all it can to shut down the wheeze's. It's a fallacy that the UK is going to sit on it's hands post (No Deal Brexit). It's the big fear. Every "Remain" projection has been backward looking NOT forward, not modelling outcomes is a very poor strategy going into the debate (and one where Merkel has been vocal - but not intervening).
IF such a scenario is to emerge, all the piffle about exports and where the border is going to look like a Puffin Club debate (to the Irish economy); and expose the total failure of EC diplomacy (which should have been to keep the UK on side). Letting the UK start running around the world like a loose cannon, especially on this stuff - IS the stuff of nightmares for the EU nations (it would be similar if we start ramping tech subsidy into orbit - it's not the volume of cars for Germany but Industrial complexity gauge - something that Corona is sticking on warp speed). If they think they can deal now given where we are is largely jokes; it would be like the EC going for a 1 on 1 straightner with Francis Begby.
Sitting in Ireland right now, must be a bit like cold war Germany. If either side rolls on the over, it won't be a pretty sight.
I don't think Ireland helped itself during Brexit either. I always had the impression they viewed the UK as an enemy and did their best to scupper Brexit for their EU pals. Not a friend and next door neighbour who they were going to still be living beside after the EU had vanished over the horizon.
irc said:
I don't think Ireland helped itself during Brexit either. I always had the impression they viewed the UK as an enemy and did their best to scupper Brexit for their EU pals. Not a friend and next door neighbour who they were going to still be living beside after the EU had vanished over the horizon.
Very much so rather than facilitate - it was and remains computer says no. In some weird thought process it will be ok in the end irc said:
I don't think Ireland helped itself during Brexit either. I always had the impression they viewed the UK as an enemy and did their best to scupper Brexit for their EU pals. Not a friend and next door neighbour who they were going to still be living beside after the EU had vanished over the horizon.
In what way could the have the Irish helped?As has become apparent, the only Brexit that would satisfy many is as close to a No-Deal that we can get. This has been demonstrated by the early attempts at a deal and shot down by the ERG et al.
Irish attempts at brokering a deal would clearly be around keeping trade flowing freely across the Irish border.
Some folks on here really don't understand the Irish viewpoint on British politics.
TheFungle said:
In what way could the have the Irish helped?
Not being so antagonistic for one. It appeared to be Varadkar barking orders at the UK, with his new best mates the EU behind him. A weedy kid hiding behind the school bully. They could have tried being conciliatory instead, brokering a deal rather than piling in on one side.TheFungle said:
In what way could the have the Irish helped?
As has become apparent, the only Brexit that would satisfy many is as close to a No-Deal that we can get. This has been demonstrated by the early attempts at a deal and shot down by the ERG et al.
Irish attempts at brokering a deal would clearly be around keeping trade flowing freely across the Irish border.
Some folks on here really don't understand the Irish viewpoint on British politics.
Having an Irish wife, and by default have Irish kids - the politics should never have been allowed to play out ON EITHER side. Unfortunately, even if Varadkar was trying to sooth the path to a deal - the EC really hasn't shown much good negotiating faith. We may not have been much better by "switching fighters" (and you can't switch fighters cos you loose all bets at the bookies); but they also did a 180 when they realised that a new bunch were in charge.As has become apparent, the only Brexit that would satisfy many is as close to a No-Deal that we can get. This has been demonstrated by the early attempts at a deal and shot down by the ERG et al.
Irish attempts at brokering a deal would clearly be around keeping trade flowing freely across the Irish border.
Some folks on here really don't understand the Irish viewpoint on British politics.
And this is where the EC has really f
ked up. In order to protect the integrity of the entire EU / project; they either failed to factor OR ignored the economic gearing between Ireland and the UK. It's much higher than rest of the EU, so changes in the underlying relationship HAVE much greater effects. This is entirely a political NOT economic move. Its likely that the UK govt have cottoned to this, but the harder the rhetoric from the EC - and push to No Deal - means a harder hit for Ireland (and if the EC are hoping to hand out a punishment beating for leaving, the UK is delivering it back in spades concentrated on Ireland). Even IF Ireland has reduced some reliance on cross border UK/NI trade - they CANNOT afford to play corporation tax whack-a-mole; when they have a massive budget dependency on it. Aside from already been locked in pitch battles with the EC on it for years. a 10% tax hit, is much worse than border export / import friction. Ignore all the social soft st those in favour of the EC expunge, they are loading the economic pain train (but for political reasons). Choo Choo!stongle said:
TheFungle said:
In what way could the have the Irish helped?
As has become apparent, the only Brexit that would satisfy many is as close to a No-Deal that we can get. This has been demonstrated by the early attempts at a deal and shot down by the ERG et al.
Irish attempts at brokering a deal would clearly be around keeping trade flowing freely across the Irish border.
Some folks on here really don't understand the Irish viewpoint on British politics.
Having an Irish wife, and by default have Irish kids - the politics should never have been allowed to play out ON EITHER side. Unfortunately, even if Varadkar was trying to sooth the path to a deal - the EC really hasn't shown much good negotiating faith. We may not have been much better by "switching fighters" (and you can't switch fighters cos you loose all bets at the bookies); but they also did a 180 when they realised that a new bunch were in charge.As has become apparent, the only Brexit that would satisfy many is as close to a No-Deal that we can get. This has been demonstrated by the early attempts at a deal and shot down by the ERG et al.
Irish attempts at brokering a deal would clearly be around keeping trade flowing freely across the Irish border.
Some folks on here really don't understand the Irish viewpoint on British politics.
And this is where the EC has really f
ked up. In order to protect the integrity of the entire EU / project; they either failed to factor OR ignored the economic gearing between Ireland and the UK. It's much higher than rest of the EU, so changes in the underlying relationship HAVE much greater effects. This is entirely a political NOT economic move. Its likely that the UK govt have cottoned to this, but the harder the rhetoric from the EC - and push to No Deal - means a harder hit for Ireland (and if the EC are hoping to hand out a punishment beating for leaving, the UK is delivering it back in spades concentrated on Ireland). Even IF Ireland has reduced some reliance on cross border UK/NI trade - they CANNOT afford to play corporation tax whack-a-mole; when they have a massive budget dependency on it. Aside from already been locked in pitch battles with the EC on it for years. a 10% tax hit, is much worse than border export / import friction. Ignore all the social soft st those in favour of the EC expunge, they are loading the economic pain train (but for political reasons). Choo Choo!
I struggle to see how the Irish Govt. could help as no doubt any concession to the EU or the UK would be met with derision by the other side.
Anyway, why should we care about what another soverign nation has to say on our internal politics?
TheFungle said:
I wonder if your Irish wife knows my Irish wife?
I struggle to see how the Irish Govt. could help as no doubt any concession to the EU or the UK would be met with derision by the other side.
Anyway, why should we care about what another soverign nation has to say on our internal politics?
I'd feel sorry for your wife if she does!!! If she happens to know a full on pro-positive discrimination fake it to make it, cos I deserve it, Ted Talks watching feminist; then its a small world. I struggle to see how the Irish Govt. could help as no doubt any concession to the EU or the UK would be met with derision by the other side.
Anyway, why should we care about what another soverign nation has to say on our internal politics?
I personally (and others in the outlaws spoken to), think that Ireland was strapped in for the ride here. Nearly all politicians are weasels, so whatever Varadakar did or didn't say really depended on which way the wind was blowing at the time.
The problem I see with much of Brexit, is the constant view through the lens of current trade figures. That does not account for issues like Corporation Tax dependency and what the EU nations or UK does going forward.
We know that Ireland has high dependency on CT. We also know that the UK is only 5th Richest nation due largely to real estate and expansive monetary policy. We know Germany is the most industrially integrated society on Earth. Each a strength, and each a weakness if fallout from a No Deal is asymmetrical to trade. And thats not a strawman, its been Merkel's tune for years. If we run for the floor on CT, its a much bigger issue for Ireland than rest of the EU. And given the EC and ECJs loathing of it, you might wonder if they care WHAT happens to Ireland IF it transpires.....
stongle said:
TheFungle said:
I wonder if your Irish wife knows my Irish wife?
I struggle to see how the Irish Govt. could help as no doubt any concession to the EU or the UK would be met with derision by the other side.
Anyway, why should we care about what another soverign nation has to say on our internal politics?
I'd feel sorry for your wife if she does!!! If she happens to know a full on pro-positive discrimination fake it to make it, cos I deserve it, Ted Talks watching feminist; then its a small world. I struggle to see how the Irish Govt. could help as no doubt any concession to the EU or the UK would be met with derision by the other side.
Anyway, why should we care about what another soverign nation has to say on our internal politics?
I personally (and others in the outlaws spoken to), think that Ireland was strapped in for the ride here. Nearly all politicians are weasels, so whatever Varadakar did or didn't say really depended on which way the wind was blowing at the time.
The problem I see with much of Brexit, is the constant view through the lens of current trade figures. That does not account for issues like Corporation Tax dependency and what the EU nations or UK does going forward.
We know that Ireland has high dependency on CT. We also know that the UK is only 5th Richest nation due largely to real estate and expansive monetary policy. We know Germany is the most industrially integrated society on Earth. Each a strength, and each a weakness if fallout from a No Deal is asymmetrical to trade. And thats not a strawman, its been Merkel's tune for years. If we run for the floor on CT, its a much bigger issue for Ireland than rest of the EU. And given the EC and ECJs loathing of it, you might wonder if they care WHAT happens to Ireland IF it transpires.....
REALIST123 said:
I’m not sure there’s any evidence to suggest that the EU, as a political entity, cares what happens in any individual member Country.
The entity exists merely for dominion, empire and power. Even the flawed construct of the Euro was deemed to be okay, because crises could be used to facilitate further integration and control.stongle said:
TheFungle said:
I wonder if your Irish wife knows my Irish wife?
I struggle to see how the Irish Govt. could help as no doubt any concession to the EU or the UK would be met with derision by the other side.
Anyway, why should we care about what another soverign nation has to say on our internal politics?
I'd feel sorry for your wife if she does!!! If she happens to know a full on pro-positive discrimination fake it to make it, cos I deserve it, Ted Talks watching feminist; then its a small world. I struggle to see how the Irish Govt. could help as no doubt any concession to the EU or the UK would be met with derision by the other side.
Anyway, why should we care about what another soverign nation has to say on our internal politics?
I personally (and others in the outlaws spoken to), think that Ireland was strapped in for the ride here. Nearly all politicians are weasels, so whatever Varadakar did or didn't say really depended on which way the wind was blowing at the time.
The problem I see with much of Brexit, is the constant view through the lens of current trade figures. That does not account for issues like Corporation Tax dependency and what the EU nations or UK does going forward.
We know that Ireland has high dependency on CT. We also know that the UK is only 5th Richest nation due largely to real estate and expansive monetary policy. We know Germany is the most industrially integrated society on Earth. Each a strength, and each a weakness if fallout from a No Deal is asymmetrical to trade. And thats not a strawman, its been Merkel's tune for years. If we run for the floor on CT, its a much bigger issue for Ireland than rest of the EU. And given the EC and ECJs loathing of it, you might wonder if they care WHAT happens to Ireland IF it transpires.....
My takeaway from your viewpoint is that each of the EU nations referenced has managed to make 'the rules' work for them over the last number of years.
The UK, Germany and Ireland have all prospered (IMO) under the EU and I'm sure each country has their own variation on what they gripe about.
History aside, does Ireland stand to do better siding with the EU or the UK?
Full disclosure: Irish man here. Paying tax to the HMRC tho. And positive about the UK generally.
But I was never sold on how existing the EU would have all the benefits of remaining, plus £350 m a week extra plus the ability to do fabulous bilateral deals with all other nations, plus honour the Good Friday Agreement, plus treat NI as part of GB whilst sharing a 500 km Border with the EU, plus 'take back control' of UK borders, laws, money.
I'm not sure what exactly the leader of a country who are staying in the EU is meant to do to deliver these promises to the UK Electorate. Varadkar is a doctor, not a feckin magician.
But I was never sold on how existing the EU would have all the benefits of remaining, plus £350 m a week extra plus the ability to do fabulous bilateral deals with all other nations, plus honour the Good Friday Agreement, plus treat NI as part of GB whilst sharing a 500 km Border with the EU, plus 'take back control' of UK borders, laws, money.
I'm not sure what exactly the leader of a country who are staying in the EU is meant to do to deliver these promises to the UK Electorate. Varadkar is a doctor, not a feckin magician.
kevinon said:
Full disclosure: Irish man here. Paying tax to the HMRC tho. And positive about the UK generally.
But I was never sold on how existing the EU would have all the benefits of remaining, plus £350 m a week extra plus the ability to do fabulous bilateral deals with all other nations, plus honour the Good Friday Agreement, plus treat NI as part of GB whilst sharing a 500 km Border with the EU, plus 'take back control' of UK borders, laws, money.
I'm not sure what exactly the leader of a country who are staying in the EU is meant to do to deliver these promises to the UK Electorate. Varadkar is a doctor, not a feckin magician.
Come and join the U.K. union you can be a federal state within it But I was never sold on how existing the EU would have all the benefits of remaining, plus £350 m a week extra plus the ability to do fabulous bilateral deals with all other nations, plus honour the Good Friday Agreement, plus treat NI as part of GB whilst sharing a 500 km Border with the EU, plus 'take back control' of UK borders, laws, money.
I'm not sure what exactly the leader of a country who are staying in the EU is meant to do to deliver these promises to the UK Electorate. Varadkar is a doctor, not a feckin magician.
Welshbeef said:
kevinon said:
Full disclosure: Irish man here. Paying tax to the HMRC tho. And positive about the UK generally.
But I was never sold on how existing the EU would have all the benefits of remaining, plus £350 m a week extra plus the ability to do fabulous bilateral deals with all other nations, plus honour the Good Friday Agreement, plus treat NI as part of GB whilst sharing a 500 km Border with the EU, plus 'take back control' of UK borders, laws, money.
I'm not sure what exactly the leader of a country who are staying in the EU is meant to do to deliver these promises to the UK Electorate. Varadkar is a doctor, not a feckin magician.
Come and join the U.K. union you can be a federal state within it But I was never sold on how existing the EU would have all the benefits of remaining, plus £350 m a week extra plus the ability to do fabulous bilateral deals with all other nations, plus honour the Good Friday Agreement, plus treat NI as part of GB whilst sharing a 500 km Border with the EU, plus 'take back control' of UK borders, laws, money.
I'm not sure what exactly the leader of a country who are staying in the EU is meant to do to deliver these promises to the UK Electorate. Varadkar is a doctor, not a feckin magician.
stongle said:
I'd feel sorry for your wife if she does!!! If she happens to know a full on pro-positive discrimination fake it to make it, cos I deserve it, Ted Talks watching feminist; then its a small world.
I personally (and others in the outlaws spoken to), think that Ireland was strapped in for the ride here. Nearly all politicians are weasels, so whatever Varadakar did or didn't say really depended on which way the wind was blowing at the time.
The problem I see with much of Brexit, is the constant view through the lens of current trade figures. That does not account for issues like Corporation Tax dependency and what the EU nations or UK does going forward.
We know that Ireland has high dependency on CT. We also know that the UK is only 5th Richest nation due largely to real estate and expansive monetary policy. We know Germany is the most industrially integrated society on Earth. Each a strength, and each a weakness if fallout from a No Deal is asymmetrical to trade. And thats not a strawman, its been Merkel's tune for years. If we run for the floor on CT, its a much bigger issue for Ireland than rest of the EU. And given the EC and ECJs loathing of it, you might wonder if they care WHAT happens to Ireland IF it transpires.....
Sorry, I haven't been following these politics so excuse my ignorance but is the Amazon tax squabble the tipping point for this?I personally (and others in the outlaws spoken to), think that Ireland was strapped in for the ride here. Nearly all politicians are weasels, so whatever Varadakar did or didn't say really depended on which way the wind was blowing at the time.
The problem I see with much of Brexit, is the constant view through the lens of current trade figures. That does not account for issues like Corporation Tax dependency and what the EU nations or UK does going forward.
We know that Ireland has high dependency on CT. We also know that the UK is only 5th Richest nation due largely to real estate and expansive monetary policy. We know Germany is the most industrially integrated society on Earth. Each a strength, and each a weakness if fallout from a No Deal is asymmetrical to trade. And thats not a strawman, its been Merkel's tune for years. If we run for the floor on CT, its a much bigger issue for Ireland than rest of the EU. And given the EC and ECJs loathing of it, you might wonder if they care WHAT happens to Ireland IF it transpires.....
Welshbeef said:
Come and join the U.K. union you can be a federal state within it
Good news; we all will bow down to the beloved British Empire **IF** they deliver what was promised pre-Referendum. You can expect India to rejoin the Empire, maybe even the USA. Everybody loves a world-beater. If however, the benefits of Brexit do not materialise, the UK might shrink to be just England. Gibraltar? Maybe the Faroe Islands?; as they were keen to do a trade deal with Dr Liam Fox, who as Foreign Secretary at the time earns credit for persuading them to sign up. I don't know if his successor, Boris Johnson added any.
Gargamel said:
I have long thought the UK have been poorly repaid during Brexit by Ireland.
I recall in the banking crisis the UK stood by Ireland and gave them a significant bailout.
Roughly 19bn through the 2 European financial stabilisation funds, 10bn through RBS and 3bn direct loan....so yeah basically one of those friends that are always there for you, when they need you.I recall in the banking crisis the UK stood by Ireland and gave them a significant bailout.
fblm said:
Gargamel said:
I have long thought the UK have been poorly repaid during Brexit by Ireland.
I recall in the banking crisis the UK stood by Ireland and gave them a significant bailout.
Roughly 19bn through the 2 European financial stabilisation funds, 10bn through RBS and 3bn direct loan....so yeah basically one of those friends that are always there for you, when they need you.I recall in the banking crisis the UK stood by Ireland and gave them a significant bailout.
Ireland sought to repay the loan early and the UK refused, as they’d miss out on the interest. “Friends” my arse!
And CT is a sovereign matter. The UK (and any other EU country) can set the rate at whatever it pleases. So why would the UK drop it post-brexit, if it didn’t seem a good idea beforehand?
Remind me, what was Starbucks’ effective tax rate in the UK again?
Ireland plays to its strengths.
M.
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