| Enda Kenny, taoiseach, Angel Gurría, OECD secretary-general, and Eamon Gilmore, tánaiste, at the OECD headquarters, Paris, Feb 07, 2014.
Corporate Tax 2014: The effective rate of
corporation tax for US companies in Ireland in 2011 was 2.2% according to a
paper published on Monday by
a Trinity College academic [pdf]. It was 2.5% in 2010 according to Finfacts.
In the paper, Jim Stewart uses US Bureau of
Economic Analysis data to determine the effective rate for 2011 and also deals
with the claims by Enda Kenny, taoiseach, that the effective tax rate in
Ireland is 11.9% - - the effective rate is the ratio of actual tax paid to
We at Finfacts have covered
both the effective rate and Kenny's misleading claim, several times over
the past year and it's not new news
even though that is the impression presented.
What the surprise/shock news highlights is how
rare official spin is challenged.
Will it be a surprise or shock when the "Dutch
Irish Dutch Sandwich" is ended,
that €50bn in services exports and related virtual Irish output will vanish?
Finfacts calculated that the effective rate for US companies was 2.5% in 2010.
Enda Kenny first used the 11.9% effective rate
talking point at the Davos World Economic Forum in January 2013. We
pointed out then January 2013 that the claim was bogus and outlined the
methodology for the template company used
in the PwC/World Bank 'Paying Taxes report.
the case study company was:
- A limited liability
- Produces ceramic
flower pots and sells them as a retailer;
- Operates in the
country’s largest business city;
- Is 100%
domestically-owned and has
five individual owners;
- Has purchased capital
equipment for use in the business;
Has 60 employees;
- Sells a property and
realises a capital gain during the year;
- Pays a dividend at
the end of the year;
- Is in its second year
- Has a trading loss
brought forward from previous year.
On Sunday, we provided more detail on the
methodology following Kenny's repeat of the 11.9% claim at a meeting at OECD
headquarters last Friday:
Corporate Tax 2014: Yahoo! joins “Double Irish Dutch Sandwich” club; IDA Ireland
wants more members
Selection of Finfacts tax reports 2013/14:
US company profits per Irish
employee at $970,000; Tax paid in Ireland at $25,000
Corporate Tax: Kenny reassures Facebook but
Ireland's rate is too high
Foreign government requests Bermuda to investigate Microsoft's Irish-linked
G-20 Australian presidency focuses on tax
"leaking bucket"; Ireland still in denial?
Corporate tax reform and the
biggest tech tax havens
Ireland's new International
Tax Charter: More political kabuki
Ireland's tax man for Silicon
Corporate Tax 2014: UK's revenues plunge; France considers reform
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