Wednesday 21 March 2018

Ireland's corporation tax to come under microscope again

Sarah McCabe

Sarah McCabe

IRELAND'S corporation tax system is to come under the microscope once again, with the launch of a new probe by the Department of Finance into how our tax regime affects the developing world.

A public consultation process and report will be completed as part of what is known as "spillover analysis" - research into what impact, positive or negative, our tax system has on weaker economies.

The influential OECD, IMF and charities around the world have called for countries to undertake spillover analysis as standard when introducing major tax changes.

News of the study follows a period of unprecedented global focus on international tax systems and corporate tax evasion, with Ireland accused of unfairly enticing investment away from other countries with a low corporation tax rate of 12.5pc.

Irish charity Christian Aid, which will be heavily involved in the new research project, has been particularly vocal on issue of corporate tax avoidance, accusing Irish-headquartered drug company Shire of the practice on Tuesday.

It estimates that developing countries lose about €160bn a year from companies who shift their tax base to low tax jurisdictions to save money.

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