Ireland Signs On To Global Deal Seeking To Curb Tax Avoidance

Ireland, a low-tax country that is the European headquarters to some of the largest U.S. technology companies, said it would join a global agreement to set a minimum rate of 15% for taxing corporate profits, easing the way to a final agreement on an overhaul of how multinationals are taxed around the world. From a report: Ireland had been one of a small number of holdouts when the outlines of a global agreement were settled in July. That accord, driven by the U.S., aims to overhaul the way multinationals are taxed, the culmination of a yearslong effort to squeeze tax avoidance arrangements. While small, Ireland plays an outsize role in strategies used by companies from the U.S. and elsewhere to lower their global tax bills. Most of the largest U.S. technology firms have their European headquarters in Ireland, and the country has also attracted the largest U.S. pharmaceutical companies.

Ireland's decision to raise its corporate tax rate from 12.5% after the agreement is implemented is a concession to key allies, particularly the U.S. "I do believe that where we are now is balanced and represents a fair compromise, reflecting the interests of the many countries involved," said Paschal Donohoe, Ireland's finance minister. Companies that rely on intellectual property can concentrate their profits in Ireland rather than in the higher-tax countries where their consumers live, and that has been a source of frustration for other governments.

Nonsense

[Anonymous Coward]

Ireland had no choice, it was either that or become a pariah with sanctions enforced on it that would've more than made up the difference anyway.

As some politicians have said, 15% should just be the starting point, next thing to do is jack it up to something sensible like 20%. Countries like Ireland can get on board, or get isolated.

Really, this is nothing more than a face saving measure on their behalf.

Re:

[saloomy]

This sounds like the actions of a cartel. Countries colluding to raise rates. You also sound like a gangster. Companies should seek out low-cost of doing business regions, and countries should court companies that do so. Ireland's position as a low-tax locality benefitted its population well, which is who the government was supposed to serve anyway, not its neighboring governments.

Besides, corporate profits are a good thing. We want increased investment in productive means. We want people to invest in comp

Re:Nonsense

[hey!]

And what exactly is the commodity they're controlling?

It's broken analogy. Countries aren't companies and citizenship is not a product.

Re:

[saloomy]

Licensure to pursue their happiness (work). It isn't a real commodity, but governments have convinced us that it is. Imagine, some people think you should have to ask for permission and get a license to set up a business and provide your goods or services to your fellow human beings. What else could be more repulsive and insulting to free-loving people...

Re:

[khchung]

And what exactly is the commodity they're controlling?

Armed forces who can arrest you and put you behind bars, or to shutdown your company leaving you without any recourse.

Re:

[saloomy]

A good reason for Irexit.

Re:Nonsense

[Jamu]

After seeing how successful Brexit is, I'm sure they'll get right on that.

Re:

[Anonymous Coward]

Except you get companies doing business in one country and paying taxes in another country. e.g. A company sells some product in a 20% tax country, but makes a loss because of all the bullshit IP it buys from their other company in a 0% tax country.

Re:

[Anonymous Coward]

Right, and your misdirection sounds like that of a child trafficking gang. You also sound like a paedophile.

Let's all make up random shit.

> Besides, corporate profits are a good thing. We want increased investment in productive means.

Therein lies the problem. That's the exact opposite of what's happened. Companies like Apple and Google have had billions sat in Ireland literally doing shit all because Ireland is so small that you couldn't find something to do with $100s of billions of dollars there if you

Re:

[dimko]

As foreign guy who actually lives in Ireland, i will disagree with: "even if you created R&D centres you couldn't find enough competent Irish staff to fill it and Ireland would never allow it population to be displaced with more immigrants than native Irish people for it to ever work. ". Ireland is EU. Legally it can't stop if Poland and Romania decided to move in. :D But I agree with rest of points.

That might be fine if the companies were in Irelan

[rsilvergun]

They're not. Apple books all its profit in Ireland while using my government and military to protect their overseas factories from being seized by the Chinese government. They received billions and billions of dollars of tax subsidies and directly and then pay no taxes whatsoever. If they were an Irish company they'd have to tread a lot more carefully in China than they do as an American company and they know it.

I'm sick and tired of these welfare Queen corporations making me pay. The only question is why aren't you?

Re:That might be fine if the companies were in Ire

[Pascoea]

The only question is why aren't you?

Because some people still believe the fantasy that "Trickle Down Economics" works.

Re:

[Pascoea]

Why is corporate socialism (aka Trickle Down) a good thing, but individual socialism is the "Red Scare" of this generation? I mean, we've been trying the whole Trickle Down experiment for how long now? Maybe trying something different isn't a horrible idea?

Re:

[robinsoz]

This sounds more and more like a protection racket. You are arguing that the reason a company pays taxes to a government is so that government will use its guns to prevent some other government from coming along and grabbing their property at gunpoint. Now the governments are getting together and agreeing that no government will charge less than a certain amount to provide the service of protecting someone from government seizure of their property. Sounds like organized crime to me.

You think the cops patrolling a neighborhood

[rsilvergun]

Is a protection racket? This isn't the government of America protecting the Apple from the government of America. They're protecting Apple from the foreign countries that Apple puts its factories in so that it can exploit those country's cheap labor.

Re:

[Joce640k]

This sounds more and more like a protection racket.

Huh? This is just a way to make the rich people pay some taxes, too.

The rich people are the ones wearing out the roads and bridges with their trucks while benefiting from the economy and conditions that the country provides for them. It seems fair to make them pay their part, just like the poor people do.

Re:

[jezwel]

The US is the country spending tax dollars protecting these companies, and those companies are paying a pittance to Ireland instead for "protection". If you are a US taxpayer you should be up in arms about the poor ROI.

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[Anubis IV]

They're not. Apple books all its profit in Ireland

They book all of their European profit in Ireland, not all profit. Apple is paying taxes on all profit booked in the US, and has been all along.

Apple still owes more, since the US is unusual in that it demands a cut from European profits as well, but it's worth making clear that they are paying taxes that would go towards the costs you're talking about.

Re:

[fustakrakich]

Yeah, they should leave Ireland alone. The US is just supposed to disallow such deductions in the first place at their end. But, who rules the world?

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[VeryFluffyBunny]

It's very simple: Corporations consume & benefit enormously from the knowledge, labour, resources, & infrastructure that are paid for with taxes. Taxes that corporations are avoiding paying their fair share of. In other words, they're ripping you & me off & so making us pay higher taxes & getting poorer investment in social infrastructure, e.g. education, law enforcement, health & social care, fundamental scientific research, & mitigating threats from extreme weather events &

Re:

[VeryFluffyBunny]

And... The slightly more complex part is that capitalism has a lot in common with feudalism, in that it makes a small number of families extremely wealthy & powerful, & in effect, above the law in many cases (i.e. barons, lords & kings of their domains). In turn, these families tend undermine our democratic processes in the pursuit of yet more wealth & power & therefore the democratic & freedoms many of us here espouse & enjoy.

Re:

[jodido]

It's completely false, as a universal proposition, that a dollar distributed to shareholders is spent more productively than a dollar distributed as taxes. Tax dollars may go to such things as fixing roads or subsidies to people to buy food. The shareholders, who BTW are overwhelmingly extremely rich, may or may not spend that dollar on anything useful. For example, who benefits from the purchase of a $30 million condo?

Re:

[Muros]

As some politicians have said, 15% should just be the starting point, next thing to do is jack it up to something sensible like 20%.

And that is exactly the reason Ireland refused to sign until the wording was changed from "at least 15%" to "15%". Ireland very much had a choice, and exercised it.

Re: Nonsense

[xenog]

Fecking bullies y'all are. Why do you get to set my corporate tax rate? If I am competitive and you are not, that should be your problem, not mine.

Genuine problem, bad solution

[john83]

Ireland should be able to set its own tax policy without the international community circling like vultures, but multinationals offshoring profits is total BS anyway. Surely there's a better solution than stripping small countries of control of their own tax policies?

Re:

[saloomy]

Not if you're a big country with the power to coerce...

Every country gives up control

[rsilvergun]

In order to take part in international trade and commerce. Just like you give up control so that you can take part in society. Ireland is basically polluting the financial Waters here. They're making a mess and leaving everyone else to clean it up for them. It's not even that beneficial for their people, it's just a few very rich people getting very rich by allowing other even richer people to dodge taxes. There's nothing wrong with treaties. If Ireland wants to continue they can but they can't expect the rest of the world to ignore the damage they're doing and act like that's okay. If your neighbor was pouring used oil into your yard you'd have a problem with that right?

Re:

[Muros]

It's not even that beneficial for their people, it's just a few very rich people getting very rich by allowing other even richer people to dodge taxes.

I don't understand why people keep parroting that nonsense. Would people in the USA consider 15 million jobs to be of no consequence? The USA has approximately 66 times the population of Ireland, and multinational corporations directly employ 230,000 people in Ireland. That is the scale of benefit for the Irish people.

Re:

[sabbede]

If politicians really want to tax the income of a corporation, it should be done through individual income taxes and capital gains, because that is where the corporations income actually is and they can’t pass those taxes on to consumers. The reason they don’t is that voters won’t vote for it. Pretend you’re taxing some wealthy entity instead and they might not realize that they will still be paying those taxes in the end.

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[Joce640k]

Ireland should be able to set its own tax policy without the international community circling like vultures

You think it's weird that countries should get pissed off when all their biggest companies send their profits to Ireland?

multinationals offshoring profits is total BS anyway.

Agreed. The sooner companies are made to pay taxes in the place where they earned the money, the better.

Re:

[sabbede]

That isn’t so easy to define. Is it where a product was invented? Designed? Built? Sold? Is it where their costs are? What if France argues that since the only costs Apple has in France are what it spends on operating Apple stores, their revenue in France is almost all profit. Apple sure won’t think so, they have costs all over the world that France doesn’t see. Besides, France is already taxing the incomes of Apple employees in France and the sales of every Apple product and the c

Re:

[DarenN]

This new agreement's importance is not the tax rate, which is eye catching but significantly less important than that everyone signed up to it agrees on where and when income is taxed. T Ireland collects ~12% of the revenue that is taxable in Ireland in corporation tax. In Ireland, corporations are taxed on profits generated in Ireland. If the profits are not generated in Ireland they are not taxable here. This is not the same everywhere (for instance the US taxes everyone everywhere for everything which is

Re:

[theCoder]

Tax companies based on their revenue not their profits. Then they cannot create OffshoreCompany that owns all their IP that Company licenses back, for a cost of at least their expected yearly profits, so they show no real profits, only OffshortCompany does. Or they could, but it wouldn't change the amount of taxes that they owe.

It's much harder to obscure or manipulate revenue, at least not in a healthy way for the company.

Of course, the tax rate would have to be much lower. You cannot just take 20% of r

Now if we can only get South Dakota to do the same

[gurps_npc]

They let wealthy people set up trusts with cash, then insist that neither the the grantor, the beneficiary or the trustee need to:

1) Pay any taxes
2) Give their names.

Other states at least require an end date to the trust, ensuring that eventually taxes get paid. But S.D. lets it last forever

If you can afford the $3-$20 k set up fee, it is the single best way to avoid paying your fair share of taxes, for ANY country.

Re: I don't get it

[djp2204]

Something something fair share something something

Tax makes governance possible

[presidenteloco]

Tax is the parts of the whole society-superorganism contributing some of their resources/work to the whole.

So that the whole can be somewhat organized/policed/normed/constrained/secured, as is necessary for co-operation to happen within the society and for the society to maintain cohesion and stable ethos and organizational memes (i.e. to maintain its identity and useful function.)

Without tax to a larger governance organization of a society, you would simply be paying "protection" tax to gang-lords / region

Re:

[ItsJustAPseudonym]

Amos Burton on The Expanse, demonstrating operational etiquette in the absence of good governance organization: https://www.youtube.com/watch?... [youtube.com]

Re:

[sjames]

It's easy to charge low taxes when the corporations paying it are mostly sponging off the tax funded services of other countries.

Re:

[sabbede]

Which is easier to say than prove.

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[sjames]

When the company has huge facilities all over the world and only a tiny office whose only activity is a chirping cricket in the country where they pay their taxes and book their income, guess what!?

Yes taxes need to be justified

[rsilvergun]

But your blanket statement that the vast majority are not justifiable needs a lot more support than just saying it. It's one of those things that has truthiness. Which is to say it sounds comfortable because people hate paying taxes but it's patently false. Seriously go look into the actual budget of the United States. Take out the trillions on military and you'll find there really isn't a lot of pork there. It's mostly keeping old people alive and occasionally building a road. Very occasionally. Now go do

Re:

[Joce640k]

This sounds like "Tax for the sake of tax". I believe all taxes need justification and the vast majority aren't justifyable.

You sound just like the guy in the The Aqueduct sketch:

https://www.youtube.com/watch?... [youtube.com]

("What have the Romans ever done for us?")

Re:

[sabbede]

All the sales of the company’s products are taxed. The wages of everyone that makes up the company are taxed. The value of the stock is taxed. A corporate income tax only serves to increase its bottom line, which means it will largely be passed on to the consumers in the form of higher prices. So why bother with something that just gets passed on to you when everything the company does gets taxed already?

I’ll tell you. There is a reason politicians like corporate taxes, and it is not the

Dead-simple solution nobody wants -

[sabbede]

Everyone set their corporate rate to 15% and move the hell on. Or accept that using corporate taxes as a political football is going to cost you more than you gain.