Business Irish

Tuesday 20 March 2018

FDI not affected by Double Irish closure

Martin Shanahan, CEO of IDA Ireland, arriving for the Dail Public Accounts Committee
Martin Shanahan, CEO of IDA Ireland, arriving for the Dail Public Accounts Committee
Colm Kelpie

Colm Kelpie

The investment pipeline into Ireland hasn't been affected by the end of the so-called Double Irish, IDA chief Martin Shanahan has said.

In the Budget, Mr Noonan announced the closure of the 'Double Irish', which allowed companies to shift profits to tax havens, in one of the biggest changes to Ireland's corporate tax structure since the 1990s.

But he also announced a scheme to give tax breaks to some companies that derive profits from patents, called the Knowledge Development Box.

Fine Gael TD John Deasy yesterday told the Public Accounts Committee, which Mr Shanahan was addressing, that he disagreed with the move to close the Double Irish.

He said he didn't believe the country or the economy was in the "right place" to give up the scheme.

But the IDA chief said there hadn't been a negative impact.

"I would point to evidence of the fact that this hasn't had a detrimental impact - which is the pipeline of investments since the Budget was announced. I would also say, that, even in advance of the budgetary announcement, there was a high degree of expectation amongst international investment community that Ireland would do something in this area. And still we see investments, very, very large investments coming through the pipeline," Mr Shanahan said.

Mr Deasy also told the committee that he had concerns about collective bargaining. He said proposed legislation that would give workers greater rights in this regard could put off US investors. He said "we were lining up reasons for them [multinationals] not to come here."

"We have just ended the Double Irish. We don't really know what is going to happen. The last thing we need to be doing is passing more legislation that could put a doubt in any US investor's mind about coming to Ireland. I just think the timing is bad," he said.

Mr Shanahan said anything that the Oireachtas did in terms of legislation should have an eye on competitiveness.

He said in terms of labour market flexibility, Ireland scored highly.

Meanwhile, CSO data showed that the level of foreign direct investment (FDI) into Ireland rose by €11bn in 2013 to €287bn. The main contributors were increases from European countries and the US.

Irish Independent

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