Saturday 10 December 2016

Trump adviser: US tax cut a priority but Ireland will still have the edge

Niall O'Connor, Ralph Riegel and Alan O'Keeffe

Published 12/11/2016 | 02:30

Donald Trump. Photo: Reuters
Donald Trump. Photo: Reuters

US president-elect Donald Trump intends to slash corporation tax within his first 100 to 150 days in office, according to his senior economic adviser.

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Stephen Moore, who this week claimed a "flood of companies" will leave countries like Ireland as a result of Mr Trump's tax plan, has indicated the reduction in the US corporation tax rate is a top priority.

Mr Moore told 'Newstalk Breakfast' the intention is to reduce the rate companies pay on their profits to 15pc, just above Ireland's 12.5pc rate.

"Ireland will still be lower than the United States, so you will still have a competitive advantage over the United States, but the advantage will be much lower than it is currently," Mr Moore said.

"If we make this change, instead of being significantly higher, you would be slightly higher.

"I think mostly the effect of our business tax reduction will be to keep companies home.

Mission High School students Hope Robertson, left, and Cat Larson protest with other high school students in opposition of Donald Trump's presidential election victory in front of City Hall in San Francisco. Photo: AP
Mission High School students Hope Robertson, left, and Cat Larson protest with other high school students in opposition of Donald Trump's presidential election victory in front of City Hall in San Francisco. Photo: AP

"This is going to be one of (Mr Trump's) highest priorities. It's very difficult to get laws passed in America but this is a new administration, he has a mandate to do this from the voters."

But in a toning down of his previous remarks, Mr Moore said Ireland is "very desirable place" to do business.

He also remarked on Ireland's educated labour force - and indicated Mr Trump has his sights more predominantly set on other countries in terms of luring back US firms.

He added: "Our concern isn't so much companies leaving for Ireland as leaving for China and Japan and Mexico and countries like that."

After initial panic in Government circles following the election result, senior ministers yesterday insisted Ireland will not panic.

In a statement, a spokesman for Finance Minister Michael Noonan said it is "not correct" to say US tax reform will damage the Irish economy.

The spokesman said: "It is important to remember that US companies come to Europe and to Ireland for many reasons of which taxation is just one.

"A lower US corporate tax rate will not reduce the need for US companies to have operations in Europe.

"Ireland remains, and will remain, a very attractive location for US businesses to invest in and operate from."

Speaking in Cork, Housing Minister Simon Coveney also insisted Ireland has no reason to panic over president-elect Trump's possible US tax policy changes.

He said: "Companies want to have a foothold in the EU. Ireland will soon be the only English-speaking country in the EU so I wouldn't be panicking about this."

Public Expenditure Minister Paschal Donohoe said American firms providing jobs in Ireland will continue to use this country as a bridge into the EU single market.

Read more: Trump has raised unrealistic hopes - he should be nervous

 

Irish Independent

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