Irish Budget 2015: Ibec, the principal business lobby group, which a decade ago was among the believers that the free lunch has been invented, is back in boomtime mode with another cheerleading report today pleading with the Government for tax cuts, to avoid its members having to raise pay, while McKinsey the US consultancy, provides a real-world perspective in a report which says beyond the corporation tax rate, Ireland has not standout attractiveness for FDI (foreign direct investment).
In respect of Ibec, it's appropriate today that Turlough O'Sullivan the retired boomtime director general of the organisation, is featured in today's piece in the Irish Independent, on the latest demand that the Government cut taxes.
Apart from tax demands, the organisation also appears to welcome rising house prices, noting: "Research has shown that a 10% rise in Irish house prices leads to a 1.1% rise in household consumption. This is very high by international standards" - - lots of features about the Irish property market are indeed odd!!
It has nothing to say on rising pay and while changes in the income tax system are merited, the demand for "self-financing" cuts is a re-launch of the boomtime mantra and cutting taxes is always much easier than raising them.
Today's 'Consumer Monitor' [pdf] report is also a reminder of the cheerleading of boomtimes with no focus on negatives unless it supports the case for tax cuts.
Since March 2011 when the current coalition took power, 60,000 jobs have been added:
Ibec says in today's report:
The 1-person operations employ themselves and the public scheme members are employed who are unemployed!
Fergal O'Brien, chief economist, commented:
McKinsey & Company in a report published last week says the low corporate tax rate will not be sufficient for Ireland to retain its current position in FDI (foreign direct investment) while the failure of indigenous firms to scale up and develop export markets will continue to be a drag on the economy.
The challenges are:
Last July Richard Bruton, enterprise minister, published a brochure rather than a strategy on FDI and again, it's is similar to today's Ibec document - - avoiding negatives that should be addressed.
Google 'Irish reform' and head of the listing is the Irish Reform Act of 1832 - British parliamentary Act!
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