Sunday 11 December 2016

‘Flood of companies’ to leave Ireland due to US tax cuts

Warning from Trump aide; Opposition demands action

Niall O'Connor, Colm Kelpie, Laura Larkin and Brian Hutton

Published 11/11/2016 | 02:30

President Barack Obama shakes hands with President-elect Donald Trump in the Oval Office of the White House in Washington yesterday in what was the first meeting of the two, who had traded insults during the election campaign. Photo: Pablo Martinez Monsivais/AP
President Barack Obama shakes hands with President-elect Donald Trump in the Oval Office of the White House in Washington yesterday in what was the first meeting of the two, who had traded insults during the election campaign. Photo: Pablo Martinez Monsivais/AP

The Government is facing urgent calls to act swiftly to protect US investment in Ireland after a top adviser to Donald Trump warned a "flood of companies" will leave under the new regime's tax plans.

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The serious threat issued by Mr Trump's economic adviser Stephen Moore sent shockwaves through political circles yesterday as the fallout from the US presidential election continues.

Just hours after Mr Trump held a 10-minute phone conversation with Taoiseach Enda Kenny, his senior aide revealed the centrepiece of the new Washington administration is to lure back multinational companies with radical tax cuts.

In a worrying development, Mr Moore cited Ireland on two occasions as one of Mr Trump's targets. He reiterated that the plan involves slashing the US corporation tax rate by up to 20pc in a move that could have major knock-on effects for Ireland.

"I believe that when we cut these tax rates, we're going to cut our business tax rate from roughly 35pc down to roughly 15 to 20pc - if you do that you are going to see a flood of companies leaving Ireland and Canada and Germany and France and they are going to come back to the United States," Mr Moore told BBC radio.

Read more: Top Donald Trump adviser warns that 'flood of companies' will leave Ireland

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"There is no question about it, and we see day after day in this country that we are losing our businesses and our corporations.

"They are effectively renouncing their US citizenship and they are moving to Canada, to Britain, to Ireland, to China and Mexico. That is a significant loss of jobs and we want to have the jobs here in the United States, we don't want to have them go abroad."

A senior Government source last night reiterated that Mr Trump and Mr Kenny had a 10-minute conversation, during which the Republican politician complimented Ireland's economy. Mr Kenny is believed to be the first EU leader to receive such a phone call.

But the threat by Mr Trump's adviser was met with mixed views in political and business circles.

Fianna Fáil leader Micheál Martin said a major plan needs to be developed, which involves the Government and key stakeholders meeting the leaders of multinationals based here.

"In my statement on the election of Mr Trump, I warned about his pursuit of US companies headquartered overseas and the need for Ireland to quickly develop a plan to deal with this," Mr Martin told the Irish Independent.

"These comments from Mr Moore would appear to confirm those fears and further emphasise the need for swift action on Ireland's behalf."

The Labour Party's jobs spokesman Alan Kelly said the warning from the Trump regime is stark and that any move to lure companies back could do "serious damage".

Speaking to the Irish Independent, Jobs Minister Mary Mitchell O'Connor insisted that US firms will continue to be a major source of investment here.

"If and when the global investment climate changes once more, we will adapt accordingly - as we have done in the past - and make sure that Ireland remains attractive to foreign investors," she said.

But business representatives said they did not believe US companies would leave Ireland.

Pádraig Cronin, partner at Deloitte, said what's here will remain.

"What's here is embedded here and it's there for a reason, so I don't see any material risk to the near term to what's already in Ireland," he said.

It was a similar view shared by Peter Vale at Grant Thornton.

He said: "There's no question that this will make the US more attractive.

"But will it mean they will all up sticks and move back to the US? No it won't."

Irish Independent

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