Irish opportunities in planned OECD tax reform

Ibec, the group that represents Irish business, welcomed today’s publication of the OECD BEPS plan for international corporate tax reform as a significant achievement, which offers substantial opportunities for the Irish economy if we react pro-actively.

Ibec Head of Policy and Chief Economist Fergal O’Brien said: “Implementation of the BEPS plan will constitute a major change to international corporate tax rules, the first in almost a century. This is necessary to reflect the modern reality of globalisation and digitalisation. From an Irish perspective, the plan offers substantial opportunities to attract new investment and jobs. To take advantage, we need to emphasise and improve our offering as a transparent, stable and investment friendly business location.

“To compete successfully on the international stage, major reform of our personal tax system is needed. Ireland’s personal taxes at below average earnings are amongst the lowest of any developed nation. The extreme progressivity of our system, however, means that for earners above this level Ireland quickly becomes a high tax country compared to the rest of the developed world. At earnings of just above €39,000, Ireland surpasses the OECD average effective income tax rate. By €80,000 Ireland has the sixth highest average income tax rate in the OECD at 34.6%, five percentage points higher than the OECD average.

“International investment decisions are increasingly based on the location decisions of key high skilled staff, rather than the other way around. The publication of today’s plan further reinforces the needed to make the country more attractive for mobile talent. Ireland is currently not at the races. Decisive action is needed in the upcoming budget. We need to reduce the marginal tax rate and end the third higher rate of tax on those earning over €70,000.”

For more please clcik: http://www.ibec.ie/IBEC/Press/PressPublicationsdoclib3.nsf/vPages/Newsroom~irish-opportunities-in-planned-oecd-tax-reform-05-10-2015?OpenDocument#.VhKX9ZVOPug 

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