Tuesday 19 June 2018

Dan O'Brien: Corporation tax: who pays what as reform calls grow

One of the usual suspects in large-scale tax avoidance — Google — was reported last week to have kept €16bn in global earnings out of the jurisdiction of any country to avoid tax. Irish-registered companies were allegedly involved. Photo: Bloomberg via Getty Images
One of the usual suspects in large-scale tax avoidance — Google — was reported last week to have kept €16bn in global earnings out of the jurisdiction of any country to avoid tax. Irish-registered companies were allegedly involved. Photo: Bloomberg via Getty Images
Dan O'Brien

Dan O'Brien

The year has hardly begun and corporation tax is already in the news. One of the usual suspects in large-scale tax avoidance - Google - was reported last week to have kept €16bn in global earnings out of the jurisdiction of any country to avoid tax. Irish-registered companies were allegedly involved.

Last Wednesday, the Department of Finance published figures on Government revenues, which included corporation tax. Yet again, receipts from taxes on profits vastly exceeded forecasters' expectations, coming in half a billion euro ahead of projections, to exceed €8bn for the first time ever. In growth terms, receipts rose by 12pc, double the Department's expected rate of increase.

There will be much more about the taxing of profits in the news in 2018, including the risks associated with the State's growing dependence on this revenue stream. Other relevant issues will include how a just-enacted US tax law will impact on American companies' operations in Ireland.

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