Monday 11 December 2017

Three of four EU probes since '91 went against Ireland Inc

BAD BUSINESS: European competition authorities have investigated 65 cases in 15 countries of suspected 'state aid' via favourable tax rules since 1991
BAD BUSINESS: European competition authorities have investigated 65 cases in 15 countries of suspected 'state aid' via favourable tax rules since 1991
Gavin McLoughlin

Gavin McLoughlin

Three out of the four EU competition probes into Ireland's taxes since 1991 have gone against the authorities here.

EU regulators ruled against special 10pc corporate tax rates that applied to companies in the IFSC, the Shannon Free Zone and the manufacturing sector. The standard rate at the time was 32pc. The then-Government introduced a standard 12.5pc rate afterward. Once the same rate applied to all companies it couldn't be challenged by the Commission.

None of the probes resulted in companies or sectors found to have benefited from a tax advantage being forced to pay back money.

Richie Boucher's mea culpa

Bank of Ireland boss Richie Boucher was in a contrite mood at the Banking Inquiry.

Boucher said sending a letter to Dublin City Council backing Sean Dunne's proposals for the Jurys/Berkeley court site was "one of the many stupid things I have done".

He said Bank of Ireland's board had made serious mistakes, citing specifically its provision of 100pc mortgages and tracker mortgages.

"I bear collective responsibility for these and my contribution to them," Boucher said.

CRH hungry for more deals

CRH is eyeing up two potential acquisitions worth a collective €1.5bn, chief executive Albert Manifold said.

The deal would be on top of its purchase of €6.5bn of assets from a merged Lafarge-Holcim. That tie-up looks set to go ahead after Holcim shareholders backed it on Friday.

Manifold said CRH wants to become the biggest building materials company in the world.

"We probably do about one in 10 deals that come onto our table. Most times we don't do deals because we don't see the value when we do further in-depth analysis," he said.

Ireland's borrowing costs double in just a fortnight

The State's borrowing costs soared, reaching close to 1.5pc for 10 year debt on Thursday. As recently as April 28 the cost was 0.7pc.

Analysts said a surge in borrowing costs for Eurozone countries was a "market rout", with Ireland among the worst affected.

"Nothing has changed on Ireland but the market was very one sided (in favour of low yields) and is now moving sharply the other way all at once," Cantor Fitzgerald's Owen Callan said.

Volatility is especially high because global banks that traditionally smoothed out big jumps by "making markets" - using their own balance sheets to buy and sell bonds - have been sidelined, partly due to more regulation.

RSA to cut up to 120 jobs

New documents revealed insurer RSA will lay off twice more staff than it previously said.

The insurer had told the Irish Independent that it was looking to get rid of up to 59 people, but the documents showed a plan to lay off up to 120 people after an independent facilitator made recommendations to management and unions.

An RSA spokesman said "no final decisions (and specifically in terms of location) have been taken on this matter.

"As such we were not in a position to provide external comment on same as to do so would simply be speculative".

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