Ireland's distorted GDP figures are less useful to investors
Published 22/07/2016 | 02:30
The country will be saddled with an increased bill of around €280m every year for the foreseeable future, Finance Minister Michael Noonan has indicated.
As a result of the astonishing 26.3pc growth rate recorded by the Central Statistics Office for 2015, Ireland's base for contributions to the European Union has been reset.
However, Mr Noonan has said that Ireland can afford the payments which could amount to billions over the coming years.
"We will have extra corporation tax, certainly sufficient to meet €280m," he said. "We got nearly €1bn extra last year.
"It's moving Irish GDP up to a new plateau. But it's a once off.
"If we are on a new plateau, what it means in effect is that the corporations, who pay the corporation tax last year, should be equally profitable this year.
"And they should be paying in and around the same amount of corporation tax."
Meanwhile, the National Treasury Management Agency (NTMA) has said that Ireland's distorted gross domestic product (GDP) figures have made them less useful to potential investors looking at Irish debt.
Figures released from the Central Statistics Office last week pointed to an enormous 26pc increase in Ireland's GDP. Ireland's growth was distorted by tax inversion deals by pharmaceutical and aircraft leasing companies.
As a result debt investors now must look at other aspects of the Irish economy to determine its attractiveness, NTMA chief executive Conor O'Kelly has said.
"There was the market impact from the surprise of the statistics - we fed a lot of calls from investors. There was a lot of explaining to do. Investors we've been speaking to are looking to other factors of our economic health for our ability to repay as opposed to GDP to debt ratio," Mr O'Kelly said.
The NTMA boss was speaking at the Public Accounts Committee yesterday, where he said Ireland remained very much an "indebted nation".