Fashion chain Zara denies Irish move is to save on tax
THE fashion chain Zara has become the latest European company to move a large part of its operations to Ireland, although the firm denies it is for tax reasons.
The online business of Zara is now run out of Dublin through a company called ITX E-Commerce Ireland Ltd, reported the 'Times' newspaper in London yesterday.
"We are not doing this for fiscal reasons. It is the know-how in Ireland,'' said the company in a statement.
While the rate in Ireland is 12.5pc, the rate in Spain, where the company is headquartered, varies between 18pc and 24pc.
While Zara has a huge number of stores around the world, including seven in Ireland, the company is rapidly expanding its online offering for brands such as Bershka, Massimo Dutti and Oysho.
Zara is simply following other European companies to Ireland where not only is tax lower, but company regulation in some areas can be lighter.
WPP, the advertising group, has moved here, as has pharma group Shire.
In a statement, the company said: "Ireland has built up many activities and companies related to e-commerce and has a specialisation and the technological resources which are required for this."
According to data in the company's office, the Irish firm was incorporated in 2006 and its last set of accounts show only a small amount of turnover going through the business.
The accounts state that the company's business related to selling "homeware products via the internet across Europe".