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Interest In Ireland 'Unwavering' Despite US Tax Reform

by Jason Gorringe, Tax-News.com, London

08 January 2018


The head of Ireland's inward investment promotion agency has said that he does not believe that the US corporate tax cut will significantly impact investment in the coming months.

Legislation was passed in December to reduce the US corporate tax rate from 35 percent to 21 percent. Ireland's corporate tax rate is 12.5 percent.

Martin Shanahan, the Chief Executive of IDA Ireland, described the move as "an effort to make the US more competitive." He told a news conference that the change "may mean that there are some margin calls where a company decides to stay in the US rather than come to Europe."

"Does it signal a significant change from an Irish perspective? I don't believe so," he said. "It isn't all about tax."

Shanahan explained that many of the decisions IDA Ireland saw in companies looking to Ireland in the latter part of 2017 "were made in full knowledge of what was coming through in the taxation bill." He said the prospect of US tax reform has not dissuaded investors.

Shanahan expects "the next couple of months to be strong in terms of investment."

IDA Ireland's end-of-year results show that employment in foreign-owned companies has now surpassed the IDA's five-year target. IDA Client Employment grew by 5.3 percent in 2017, against a national average of 2.3 percent. 19,851 jobs were created in foreign direct investment companies.

TAGS: tax | investment | Ireland | foreign direct investment (FDI) | corporation tax | multinationals | tax rates | United States | tax reform

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