Wednesday 24 July 2019

Accenture moves its HQ to Ireland as US targets tax havens

Ailish O'Hora

Management consultancy firm Accenture is the latest overseas company to move its headquarters here.

Accenture has written to its shareholders asking them to approve the move from Bermuda, which is a tax haven.

In a letter to shareholders the company said Ireland has long-established tax and trade agreements with the EU.

Ireland also has one of the lowest corporation tax rates in the world at 12.5pc.

Back in May, Accenture's board of directors had unanimously approved switching the company's place of incorporation from Bermuda to Ireland.

The move comes amid a crackdown on tax havens by the Obama administration and congressional Democrats, who are targeting companies with substantial US operations that are incorporated in tax havens like Bermuda.

In a trend that has gained momentum over the past six months, numerous US companies are reincorporating from tax-friendly locations like Bermuda and the Cayman Islands to Switzerland and Ireland, in an effort to cope with what are expected to be significant changes in how the US taxes multinational corporations.

Tyco International, Foster Wheeler, Weatherford International, Transocean, Covidien, and Ingersoll-Rand have all announced plans or finalised plans to make such moves over the past six months.

Many of these companies have said taxes were a reason behind the move but have also emphasised other strategic reasons for the changes.

Over the years, various pieces of US anti tax-haven legislation specifically targeted countries that don't have tax treaties with the US, such as Bermuda.

That could put companies incorporated in countries that do have tax treaties with the US -- such as Ireland -- in a better position, according to tax experts who have consulted on such moves.

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