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Bear in mind that countries like France have even lower rates in practice due to various loopholes for their largest corporations - https://www.irishexaminer.co
by barrkel 9y ago
Bear in mind that countries like France have even lower rates in practice due to various loopholes for their largest corporations - https://www.irishexaminer.com/business/france-has-lower-effective-tax-rate-than-ireland-study-227320.html https://www.irishexaminer.com/business/france-has-lower-effe... - effective tax rate of 8.2% as of 2013.
The leak in the system is consolidated tax base, not different tax rates. That is, booking revenue (especially digital revenue) from sales across the whole of the EU in a single EU country for tax purposes promotes a race to the bottom. The right answer is to tax in proportion to the economic activity per country - https://en.wikipedia.org/wiki/Common_Consolidated_Corporate_Tax_Base https://en.wikipedia.org/wiki/Common_Consolidated_Corporate_... .
Unified corporate and income tax rates aren't a smart idea. There's no good reason to force one government to be less efficient than another.
Finally, the bailout (and to be clear: loans, not free money, and loans that were paid off early because they had higher interest rate than was available on the market) of Ireland was an indirect support for banks in other countries that had capital surplus for some years, Germany especially. The ECB forced Ireland to prevent bondholders from taking any losses - https://www.irishtimes.com/news/politics/ecb-refusal-on-bondholders-left-public-with-inappropriate-burden-1.2512935 https://www.irishtimes.com/news/politics/ecb-refusal-on-bond...
- lucideer 9y ago> Bear in mind that countries like France have even lower rates in practice due to various loopholes for their largest corporations Ireland also has lower rates in practice due to allowances for their largest corporations: Apple's allowance afforded them an effective rate of <1%, hence the $21 billion.
- ju-st 9y agoIreland is not the only loophole: Luxembourg, Belgium and the Netherlands made "special" deals with large corporations, too. https://www.ft.com/content/7ce5bf96-a83d-11e7-ab55-27219df83c97 https://www.ft.com/content/7ce5bf96-a83d-11e7-ab55-27219df83...
- lucideer 9y agoYeah, I'm sure others too. Interested to see if these are pursued in court as well, or even other corporations with deals in Ireland (Apple are in no way the only one). When the Apple ruling first came out there was talk of it being the first of others, but with how much resistance the Irish government have put up, it's hard to see them coming to fruition at this stage.
- flipp3r 9y agoCan confirm; working in the Netherlands right now for a large organization which basically got granted 10M tax deduction for innovation which boils down to implementing React in our frontends, doing microservices in Kubernetes, and building CI/CD pipelines in Jenkins.... As a small company you can apply for this same innovation thing and get 17K tax deduction, and you have to put 500 hours into it. It's rediculous. It's called "WBSO (Wet Bevordering Speur- en Ontwikkelingswerk)". Hoi Jan.
- messe 9y agoWhile that is true for Apple, if you'd read the article you'd notice that the effective corporate tax rate in Ireland (11.9%), as found by the study, is still higher than France's (8.2%), and far closer to the advertised rate of 12.5%.
- s_dev 9y agoIrish effective corporate tax is 11.8%. The deal with Apple was considered a sweetheart deal and is illegal (under EU law but not Irish) and not available to other companies. OP is right correct approach is a consolidated tax rate/base across EMU.