Google, Dublin and them Dems
It's a great day for the Irish, no doubt, when the government is able to announce that the 800 Googlers currently busy in Dublin are soon to be joined by another 500. Feather in the cap of IDA Ireland, and all that. Those who scoffed at the country's vision of moving from an agrarian society to a global services one must be feeling confounded now.
But, and there's always a but… could the vision be in mortal danger now that the Democrats are swinging their big sticks in Washington DC? Absurd and all as the question may sound, there is room for concern. You see, the Irish corporate tax rate is 12.5 percent and the US federal corporate tax rate is 35 percent. So? Well, last year the Wall Street Journal revealed that an unknown company called Round Island One had become Ireland's biggest taxpayer. It declared profits of more than $9 billion in 2004 and paid the Irish exchequer $300 million in taxes. Round Island One is a subsidiary of Microsoft, which has its European HQ in Dublin, as does Google and lots of other US corporations.
All this leads Richard Delevan to point out that Charlie Rangel, the Democrat Harlem congressman expected to chair the powerful Ways & Means committee, will be taking a different tack to the "Republican-controlled Congress, probably most business-friendly since the 1920s." Money quote:
"One of Rangel's top priorities will be to make it harder for big companies to avoid US taxes by booking their profits in foreign subsidiaries — like the corporates that make up the bulk of Ireland's top taxpayers. American taxpayers have been subsidising public services in Ireland and other 'offshore tax havens' for the past decade. Democrats want to bring that to an end."
Excellent analysis and it is good to see Richard Delevan back blogging again. Those sleepless nights must be drawing to a close.
