The Dutch Sandwich and Double Irish figure prominently in this FT article about Google’s tax returns for 2012.
It seems that Google Netherlands Holdings, which represents the Dutch part of the sandwich, received €8.6bn in royalties from Google Ireland Ltd last year.
Google’s Tax Planning
The Dutch Sandwich and Double Irish figure prominently in this FT article about Google’s tax returns for 2012.
34 replies on “Google’s Tax Planning”
Whatever about the corporate tax rate, what would Ireland have to lose by coming to an agreement on the tax base? Agreeing that profits earned in country are taxed in country would surely work in our favour and gain support from other EU countries.
“Agreeing that profits earned in country are taxed in country..”
Indeed if profits corporate profits were taxed on the basis you suggest at 30% EU wide, no exceptions of any kind, it would diminish by 30% the trade imbalances in the EU, which are largely in favour of Germany. So the likelihood is that it will not happen, and will be blocked in Germany, not Ireland.
The piece could have mentioned that the corporate tax rate in Bermuda is zero. It is not the Irish tax system that allows Google to shift profits to Bermuda – that can be done from lots of countries using standard transfer pricing rules. The OECD is looking at these but it is far from clear that anything substantive will result.
The big advantage the Irish system offers is that our tax residency rules (the “test of management” for some companies) allow US companies to take advantage of the “same country exemption” for Subpart F income. This allows US companies to defer the payment of their tax liability on their global profits until they repatriate the profit, although the piece indicates that Google have little intention of repatriating the profits.
Using Bermuda’s zero rate, Google is able to massively reduce its global tax bill. Using Ireland, Google is able to indefinitely defer payment of its US tax bill.
Substantive changes to transfer pricing rules might reduce the ability of companies to shift profits to no-tax Bermuda where they have no presence of substance. Transfers to low-tax Ireland would still be possible if companies maintain a large presence here. If these changes happen it may be a positive for Ireland. Substantive changes accepted by all are unlikely and predicting the impact of them is difficult.
Changes to US tax law could eliminate the “same country exemption” used by Google (or the “ocean money” created by Apple) but this is very very unlikely given the current political dysfunction in Congress. This would reduce the attractiveness of Ireland to US companies but as the changes would apply to all countries the relative positions may not be affected.
Are these the minutiae that are holding up a grand coalition in Germany? Not a chance.
@ Seamus Coffey
I don’t accept this.
Resident companies are also involved in the chain in these type of transactions.
In the Finance Act, 1999, under pressure from the EU, Irish-incorporated companies became resident and under pressure from multinational companies established in Ireland, there was an exemption whereby an Irish company related to one with operations in Ireland but controlled overseas, would be treated as non-tax resident.
This was important as US companies wished to avoid being seen as operating in island tax havens such as Bermuda. Accenture switched its hq from there to Ireland in 2009.
Google for example in its annual 10K return to the US SEC, said in respect of its foreign income of $8.1bn in 2012 that: “Substantially all of the income from foreign operations was earned by an Irish subsidiary” – a letter box company in Hamilton in the offices of an offshore services company.
The non-resident companies termed ‘stateless’ by a US Senate panel last May, are not an Irish responsibility?
As for the resident companies, why do you think the Revenue turn a blind eye to huge annual charges that are designed to minimise the reported net income in Ireland?
How credible is the almost dollar for dollar matching of a 25% or 37% multi-billion dollar rise in revenues with royalties and license fees?
Simply to a Revenue official, it should not be credible.
Google Inc’s net income is 30% of revenues; it diverts 41% to Ireland and it reports a net income ratio of 0.8%.
It’s said to be legal but you can be damn sure that a domestic company booking a charge from a letter box company in Bermuda to minimise profit wouldn’t get away with it.
For more than 2 decades, the Irish Revenue has aggressively gone after personal users of tax havens, imposing big penalties and naming and shaming them.
Still, according to Irish ministers, “The Irish tax regime is a statute based, transparent and clear system” – this is simply a joke: it’s a tack consistent with the modern political messaging of repetition, irrespective of the veracity and if pressed on individual company examples, that is easy to handle: “We cannot comment on individual cases.”
They argue that the effective rate of corporate tax is 11.9% but this is absolute nonsense.
Clever Bill Clinton was giving the blarney the locals wanted to hear on tax havens, during his Irish trip.
I expect the OECD to come forward with proposals on base erosion that the G-20 will accept.
Irish policy makers and others, including the Swiss, are on the back foot with the surprise international momentum on this issue.
The avoidance/ evasion simply developed to a ridiculous level.
US company profits per Irish employee at $970,000; Tax paid in Ireland at $25,000
t’s like an island of cargo cultists attempting to get an airplane to return while ignoring the garden that they are trampling.
On the recent thread Jobs without Growth, Joseph Ryan (October 9th, 2013 at 8:44 pm) asked whether our GNP was growing “sufficiently to more than offset the fall,… caused by the pharma sector to GDP figures.”?
What is the point of using data that is so unrelated to the real economy that an increase in employment, somewhere, cannot be apportioned. How can anyone say that a particular policy is useful if the data is so unrelated to the outcome?
Instead we attempt to measure the size of a balloon that someone else is blowing up while fending off the person with a pin that could stop the whole game.
@SC you sound awfully confident….it may go this direction,court decision on OMT any day now,must be getting a bit nervous.When the tide goes out…
“We say that whoever wants a common resolution fund must agree to a financial transaction tax,” Carsten Schneider, SPD budget spokesman in the German parliament, told the Financial Times. That would affect eurozone members such as Ireland, Luxembourg and the Netherlands which have opposed having any such tax.
I think we agree on the details but individual subjectiveness leads us to different conclusions.
Google uses an Irish-incorporated, Bermudan-resident company to gather its global profits. What difference would it make to the tax due outside the US if Google used a Bermudan-incorporated, Bermudan-resident company? Why does it use an Irish-resident company?
These companies used by Apple have their operations in the US; most of their staff is in the US; their board meetings are held in the US; their huge assets are held in the US. I’d ask why they should be our responsibility.
Between the soundbits, Carl Levin has been pretty clear that the responsibility for them clearly lies with the US. He has said:
“Apple is exploiting an absurdity, one that we have not seen other companies use. The absurdity need not continue. Although the United States generally looks to where an entity is incorporated to determine its tax residency, it is possible to penetrate an entity’s corporate structure for tax purposes, and collect U.S. taxes on its income, if the entity is controlled by its U.S. parent to such a degree that the shell entity is nothing more than an “instrumentality” of its parent, a sham that should be treated as the parent itself rather than as a separate legal entity. AOI, AOE and ASI all sure seem to fit that description.
In short, these companies’ decision makers, board meetings, assets, asset managers, and key accounting records are all in the United States. Their activities are entirely controlled by Apple Inc. in the United States. Apple’s tax director acknowledged to the Subcommittee staff that it was his opinion that AOI is functionally managed and controlled in the United States. The circumstances with ASI and AOE appear to be similar.
Our legal system has a preference to respect the corporate form. But the facts here present this issue: Are these offshore corporations so totally controlled by Apple Inc. that their identity as separate companies is a sham and a mere instrumentality of the parent, and if so, whether Apple’s claim that AOI and ASI owe no U.S. taxes is a sham as well?”
I don’t think the Revenue “turn a blind eye” to the massive trade charges that reduce taxable income in Ireland. The Revenue know that most of these relate to patent royalties but there really is little the Revenue can do if companies comply with the international standard “arm’s length” principle for transfer pricing.
The entire system of international corporate tax is in need of an overhaul, not just Ireland’s.
@MH NYT front page Bus. section yesterday.
@ john gallaher,
That is an excellent piece. This in particular should get more attention:
Irish sectoral accounts show that non-financial corporate debt has ballooned here since 2007. It rose from around 200% of GDP in 2007 to near 350% of GDP in 2010. See this chart from the CSO:
NFC Debt and GDP, 2001 to 2010
Although not certain, taxation provides a possible reason for the increase. Points 3 and 4 of the OECD Action Plan on BEPS address this.
Lack of transparency in the operation of the tax system has naturally led to supposition. At first people presumed that all these companies were following the same beaten tax track. Something about a “Dutch Sandwich” where huge profits were booked in Ireland to take advantage of our low tax rates.
But they weren’t all doing the same thing. Now we see Microsoft is booking surprisingly large profits in Ireland (>1bn) for the size of its operation and the type of work being done and paying 12.5% tax. Meanwhile, Google is booking a more credible €154m and paying €17m on that. Finally, Apple is paying less than 2% corp tax on its Irish operation profits by booking sales to a company located in a fiscal north Atlantic space-time singularity.
The question about special tax deals is whether the Irish revenue was cutting individual deals with corporations or individuals in exchange for doing business in the jurisdiction. Certain Swiss Cantons cut individual tax deals to attract new residents (the “forfait fiscal”) where taxes are set at a fixed lump sum regardless of income.
It seems that this kind of stroke is not going on in Ireland and is no longer allowed under EU law (“our taxes are statute based”) however the Irish revenue still meets the finance departments of companies to agree in advance the taxes that would be due under various scenarios. I suspect this was the source of the confusion over Apple saying they had “a deal” with the Irish authorities not to pay taxes on their Irish registered company that had its operations and staff in the US. Really they had just agreed that their structure was legal with the Irish revenue in advance, with the Irish assuming or not caring if the Americans would collect taxes at their end. You would think that a double taxation agreement was invented for exactly this situation.
The US would seem to be within their rights to now claim a large slice of back tax from Apple going back decades. And what better time to do so than now when they are sitting on a $150bn cash pile?
What should we change in Ireland?
What about more transparency in the accounts of Irish registered companies regardless of limited/unlimited status?
We saw many unlimited companies during the construction boom that ultimately became a cost to the state, so the notion that they carry their own risks is thin.
How about the US starts taxing its own companies rather than pointing at Johnny Foreigner?
How about a clear policy that local profits should be commensurate with local value-add?
SC has a point to spell out “the responsibility for them clearly lies with the US”.
I would like to point out that the corporate profits of German companies go to physical companies with physical headquarters here.
do you have a link to back up your claim? Or at least describe the way you arrived at that figure? I can do some data pulling and calculations on my own, that is not the problem.
@Seamus Coffey,thanks for the links truly not my area at all,just was in the paper yesterday.Finishing the morning papers here very little on Ireland and taxes,which is good !
The blog is excellent ‘at risk’ is a must read,great work.
@ Seamus Coffey
Google chose to use a non-tax resident Irish company because it could use the term “Irish subsidiary” regarding its foreign income rather than a direct subsidiary in Bermuda, which in the US is associated with US companies avoiding tax.
Jesse Drucker, a Bloomberg investigative reporter who was in Dublin in recent weeks, first broke the story on Google’s tax arrangements in 2010.
The point about the Irish Revenue and royalty/licensing fees charges, is that Google reported a rise in net income in Ireland of €120m in 2012 after an increase in revenues of more than €3bn – an excessive technology cost rate surely?
What is the standard “arm’s length” principle for transfer pricing in this case?
The main use of non-tax resident companies is tax avoidance and I guess most people who came across a story about an equivalent Swiss entity used by a large American company would think that it would be odd if Switzerland said it had no responsibility for such a company as it’s controlled in any place other than its own country.
There are far more significant reasons for Google to use an Irish-incorporated company than the ability to use the term “Irish subsidiary” regarding its foreign income.
The use of Ireland has little impact on the amount of tax Google pays on its global profits. There are lots of ways to shift it to zero-tax Bermuda. The “Double-Irish” is just an intermediate step on the way the affects US tax.
The “same country exemption” for Subpart F income is applicant of the payer and recipient companies of the passive income are in the same country. Within Google the royalty payments are transferred between Google Ireland and Google Ireland Holdings so the exemption applies. This means the US tax due on the global profits earned by Google is only payable when Google actually repatriates the profits to the US.
Again it is down to how the different tax systems interact. Although incorporated in Ireland, under the residency rules applied here, Google Ireland Holdings is deemed non-resident for tax purposes. The US applies different rules and deems Google Ireland Holdings to be resident here – although it is well understood to be tax resident in Bermuda. If the US system did not consider Google Ireland Holdings to be resident in Ireland then the “same country exemption” would not apply and Google would not be able to (or would at least have to find another way to) defer its US corporate tax liability.
So who is at fault? Is it Ireland’s fault that our rules consider Google Ireland Holdings to be tax resident in Bermuda? Is it the US’s fault that their rules consider Google Ireland Holdings to be resident in Ireland? Whatever the case it will have little effect on Google’s ability to (ab)use the zero percent corporate tax rate in Bermuda.
Of course, Ireland is not an insider bystander in all these. Our system has been actively designed to take advantage of the provisions available in the US tax code. But even if we disallow their use here the provisions will remain and companies will just avail of them elsewhere.
On transfer pricing, yes the rules need to be tightened up. But if Google say that a €3 billion rise in revenue results in a €120 million increase in net income what can the Revenue do? On what basis can the Revenue say that the price is “wrong”? Is there a market price for a comparable service that can be used? I agree completely that it is an excessive rate but I don’t see what our Revenue can do about it. As long as Google can provide a justification under current transfer pricing rules for the price used there is little scope for objection.
It is not non-tax resident companies that lead to tax avoidance, it is no tax jurisdictions such as Bermuda that lead to it. Is Ireland a stepping-stone to Bermuda? Yes. But we are far from being the only one.
Ireland has many tax advantages for companies. We should have no problem with the likes of Google using Ireland to defer their US tax liability on their global profits. It is a US provision that allows it; if they want to get rid of it they can. It is the ability to shift profits to zero-tax Bermuda that needs to be curbed. That shifting reduces the tax paid by MNCs in the countries they operate in outside the US. If it wasn’t so easy to shift profits to Bermuda then countries like Ireland, where such companies have a large presence, may be able to collect more tax revenue. Such a change might actually make our 12.5% rate more relevant. We could go on a solo-run and prevent profit shifting from Ireland to Bermuda but the companies will just find somewhere else to do it from.
Spiegel article on the FT article…
Puts all that goofy softy Innenarchitektur by Google at Grand Canal Dock as seen from ‘de Dart’ in a different light
@ Seamus Coffey
“It is a US provision that allows it; if they want to get rid of it they can. It is the ability to shift profits to zero-tax Bermuda that needs to be curbed. That shifting reduces the tax paid by MNCs in the countries they operate in outside the US. If it wasn’t so easy to shift profits to Bermuda then countries like Ireland, where such companies have a large presence, may be able to collect more tax revenue. Such a change might actually make our 12.5% rate more relevant. We could go on a solo-run and prevent profit shifting from Ireland to Bermuda but the companies will just find somewhere else to do it from.”
Why would Ireland undertake such a solo run? Maybe those exercised about the issue could advance some reasons!
There is no doubt in my mind but that the Irish gov’t is making side deals at zero, 2%, 5% … This is what will do us in by making our more respectable 12.5% rate suspect. The SDP seems to have missed the side deals at least in their communications with the German media. There is a stench of wrongdoing now emanating from Irish tax policy which is making us an easy target. Even the Republican John McCain who never saw a corporation that did not merit a tax break has now noticed what is going on in Ireland, Holland, Bermuda.
If we do not clean up our sleazy act with alacrity it will be cleaned up for us with the 12.5% rate under threat.
I am surprised that blame is being shifted in the usual manner to anybody but us. We wanted a protected level playing field, we got it in the form of the EU and EZ and immediately we game it as if we were an unaffiliated Switzerland or Singapore.
With the loss of the FDP Merkel has been weakened, Hollande is far to the left of Sarkozy. Facilitating tax evasion has lost two of its strongest enablers. We should pay attention.
@ Mickey Hickey
Is it not clear by now that nobody in this game is blameless. Our act will be cleaned up by whom?
@ Mickey Hickey
The contradiction between political bluster about “regaining the country’s sovereignty” and sticking the hand out is getting so obvious that even the average punter may be waking up to it.
One way or the other, trading the country’s strongest card for some further imagined “largesse”, i.e. loans, would simply make no sense.
We are a debtor nation, still running a deficit, looking for bridge financing so as we can issue bonds in 2014. The levers of power are held by the creditors and parties aggrieved by our short sighted beggar ourselves and our neighbours tax policies.
We are vulnerable beyond a shadow of a doubt.
We have been comforting ourselves with the Von Clausewitz truism that governments do not have friends they have interests. Merkel and Sarkozy were all in favour of low taxes for their corporations. Ireland could be used as a wedge to lower German and French corporate taxes. The FDP who propped up Merkel were admirers of Irish low corporate tax rates. Since the French and German elections the climate is no longer favourable to niche tax leaks. In the USA the Republicans will be casting around for vote getters for the 2014 elections. There is no better vote getter than we will stop them foreigners robbing us. They may be dysfunctional but imminent hanging concentrates minds wonderfully.
Correction on my comment above
“Indeed if profits corporate profits were taxed on the basis you suggest at 30% EU wide, no exceptions of any kind, it would diminish by 30% the trade imbalances in the EU, which are largely in favour of Germany. ”
That is incorrect.
It should read;
it would diminish by 30%, the profit on the differential trade imbalances in the EU, which are largely in favour of Germany.
With a profit margin of say 10%, which is high, taxed at say 30%, the net effect would be to transfer 3% of the trade surplus to the tax coffers of the deficit countries. Not a huge amount. But I can see why France is doing most of the running on the Consolidated Tax regime.
I should add that if anybody thinks tax arrangements/ tax shifting are complex right now, it would be rivaled and exceeded by the complexity of arrangements to manipulate the Consolidated tax rules.
One further point.
It was a real pity that the 12.5% corp tax was introduced for ‘domestic companies without some offsetting contribution. It weakened the tax base from domestic companies, including banks, developers, builders etc. It should have been offset at the time with a compulsory employer pension contribution. That would have had no effect on multinationals, as virtually all provided pensions of some kind for employees anyway.
The 12.5% was a massive tax relief for for most Irish corporates, small and large. It was given away for nothing. The relief was blown away, in many cases, on the property craze.
The opportunity to improve the lot of employees, was probably not even on the agenda. Plus la change.
Ireland has been pushing the edges on this for many years now. It has become a facilitator of tax arbitrage on a grand scale and no longer has control of its roles a ((large) cog in the tax avoidance wheel.
Bermuda and co are openly tax havens. They openly admit that. However, to gain access to their tax benefits, one must first have access to a DTA network, and Ireland is clearly the leader in facilitating that for US corps. Thatsiad, Ireland is relatively small compared to Lux or NL…..but Ireland’s US orientation in this regard is no. 1
Your analysis is very simplistic, really. Very amateurish comments on here re how tax international corp tax works (part of my life now for 25 yrs).
One can argue all one wants about the rights and wrongs…..the point is that the tax arbitrage era is coming to a close…..and it’s not good for Ireland if that happens too quickly….
I should add that tax losses (carried forward) by FIs and corps of all types is not a subject one sees figures for in Ireland. How has the CT tax take bee affected by same in recent years? By how much has the CT take declined off peak? Maybe MH can provide some info.
I like the depth and breadth of your comment.
wrt Bermuda and its zero tax rate. From a US perspective the avoidance is being done in Ireland and Holland. What has changed is that US legislators looked at overseas earnings of US corporations as being held temporarily abroad and used to smooth cash flow in the US for the parent company over an economic cycle (5 or 6 yrs). With the high profitability of companies like Google, Apple, GE and others there has been no need to use cash flow smoothing in the US so the funds are kept (de jure not de facto) abroad indefinitely.
Since the US credits the companies repatriating profits to the US for taxes paid abroad a zero tax rate abroad actually benefits the US. The downside is that companies can profit indefinitely at zero tax rate from funds based (de jure) in Bermuda. At some point US legislators will succumb to domestic political pressure and impose time limits on profits held abroad. They will also look carefully at justification for profit streams being transferred abroad.
As pointed out in a number of comments changes are imminent.
Ars Technica’s take on the Google schemozzle.
Quartz with France’s take on the Google schemozzle,
Pointing a finger at Bermuda is of course a red herring. There is no “Bermuda” in Apple’s scheme, as it is not necessary. All that matters is that the profits end up in an Irish holding company that is not tax-resident in Ireland. Such a company doesn’t have to be tax-resident anywhere. It may be tax-resident in some sunny island or could simply be, as nicely put above, a North Atlantic space-time singularity. Bermuda is where Google transferred its core IP back in 2003; the scheme would work just as well if Google Ireland Holdings owned the core IP, in the same way that Apple Operations International holds the Apple IP.
Here’s a nice colour diagram prepared by an Irish firm
that illustrates the general scheme.
A lots of things get conflated when discussing this issue, but for the purposes of drivers that will change the current cozy situation there are two quite different ones, and they are not at all aligned. One is changes to the US tax code, but for a country that doesn’t know if it will manage to pay interest on its T-bills in a couple of weeks time, that can be safely stored away in the box marked “long-term”. The other is non-US advanced countries getting fed up with the pay-royalties-to-myself-so-my-subsidiaries-lose-money trick, such that profitable companies with billions of revenues pay no tax in the UK, Germany, Spain etc. For Ireland that’s the one to watch.
Here Le Monde contrasts Ryanair and Google.
Ryanair has already announced that it would file an appeal. -Think you it is likely to get a more lenient decision?
It can still make calls, but in this case, French law seems very clear. We can not, on the one hand, gather parliamentary commissions of inquiry to find out if Google should pay taxes in France, and on the other side, leaving Ryanair continue to operate from French bases without pay or social security contributions or taxes in France.
I think the decision will be upheld on appeal and there will be a third phase with the input of the Court of Justice European. For now, Europe gathers sovereign states. If there is still social barriers to entry states today is because we always work according to national law. There certainly are a single currency and a common market, but every European country is absolutely master of his decisions in the fiscal and social fields.
Well shure the man himself, no not God, Bono : the Irishman who brought much needed Louis Vuitton to the plains of Africa
say that : “U2 is in total harmony with our government’s philosophy,” he told The Observer. “Tax competitiveness has taken our country out of poverty. [The revenue] accept that if you engage in that policy then some people are going to go out, and some people are coming in.”
He added: “At the heart of the Irish economy has always been the philosophy of tax competitiveness. On the cranky left that is very annoying, I can see that. But [that] is why Ireland has stayed afloat.”
……claiming the Irish government would ultimately appreciate the band’s decision to offshore a share of its income through the Netherlands.
Last month Switzerland expressed concern that in a return to “power politics,” larger states are once again choosing to exercise their power and strength. “I sincerely hope that this trend will be corrected,” Ueli Maurer, the Swiss president, told the United Nations. “No country imposes its law over that of another country. Problems are not solved by diktat, but through negotiation.”
The US has led a battle to end Switzerland’s haven for tax criminals beyond its borders and Swiss banking secrecy is on a respirator.
Breach of bank secrecy became a criminal offence in 1934 after a police raid in Paris on the branch of Basler Handelsbank, which exposed members of French high society, among them two bishops, several generals, and the owners of Le Figaro and Le Matin newspapers, as tax evaders.
Corporate tax avoidance on a massive scale is also on a respirator and Ireland is in need of a jobs engine.
Emerging market investors are unlikely to become significant FDI investors in Ireland, while the latest survey of international financial professionals has put the IFSC at 56 rank of 80 global financial centres, compared with 13 in early 2008.
Richard Bruton may well not know that US and UK research shows that high growth firms are not typically in high tech.
Claiming Dublin as the ‘Internet capital of Europe’ when most of the work done in these firms is multilingual customer support and sales administration, is a benefit and maybe good short-term PR but is not a basis for a viable long-term strategy.
The US government is shut, the Republicans are hellbent on cutting research budgets while the Google’s founders have become symbols of tax avoidance.
In the US, the typical (median) real household income in 2012 was below the 1989 level while in San Francisco and San Jose, the cities struggle to provide basic services as the mainly white male tech elite, live above it all.
Sergey Brin, Google co-founder who was an immigrant from Russia, had his Stanford University graduate degree course funded by an agency of the United States government, which also provided funding for the Google project.
The National Science Foundation led the multi-agency Digital Library Initiative (DLI) that, in 1994 made its first six awards. One of those awards supported a Stanford University project led by professors Hector Garcia-Molina and Terry Winograd.
Larry Page and Sergey Brin, Stanford graduate students working on the DLI project. (Brin was supported by an NSF Graduate Student Fellowship) constructed a prototype search engine in their Stanford student offices. The equipment for the prototype, called BackRub, was funded by the DLI project and other industrial contributions.
By late 1997, the BackRub approach proved to be sound, expandable and popular in 1998 Page and Brin obtained funding and moved their growing facility from the Stanford campus.
to a friend’s garage and incorporated Google, Inc.
@ Paul W
Corporation tax receipts peaked at €6.7bn in 2006 and were down to €4.2bn in 2012 compared with €3.9bn in 2000.
Keith Walsh, a Revenue economist, using a sample of the 250 largest firms filing returns, estimated that US owned firms accounted for about one-third of
payments in the period 2001-2010.
As an annual receipt relative to direct spending on public supports, there is not a huge amount left over.
I would expect that the local linkages in manufacturing would be a lot greater than in services.
@ Joseph Ryan
6% trade surplus, 7.5% profit (PE =13 for EWG), a corporate tax rate of 25% makes a 0.11 % GDP difference, and allegedly our intra-EU trade is already balanced.
To put it into perspective:
EU contribution 0.45%, development aid 0.38%,
allegedly we loose some 0.5% on lost interest, depending on who calculates how.
I dont think we would fret much about tax changes you are discussing.
Transnationals have the ‘cash’ and the ‘political influence’.
Even locally, not one cent of extra taxation from the corporate sector as a contribution to resolution of the fiscal and banking crises.
The blind, the deaf and the lame have contributed more.