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To keep the Irish Corporate Tax, or not to keep?
by Christos Mouzeviris
2011-05-27 07:57:39
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We have been there so many times before, during the Lisbon Treaty referendum, during the IMF/EU loan to Ireland...One "important" Irish national issue that needs to be negotiated between Irish politicians and their European counterparts (especially French President Nikolas Sarkozy and German Chancellor Angela Merkel) is the low Irish corporate tax. The French and Germans insist that Ireland should raise it, the Irish insist the opposite. And of course the public of both sides is fed with populist propaganda in an argument that is a lose-lose situation for them!

Low corporate taxes serve only the Corporations!! The people end up paying higher taxes to cover for the taxes that the Corporations avoid. So why is the Irish public so protective of them? Simply because their Government and media are portraying the issue as an important national asset. The truth is that the country benefits little from having lower corporate tax. Most companies are "ghost" companies; they just set up an office in Ireland and employ few employees if any! The people do not really benefit and they have the illusion that lower taxes for corporate companies actually mean employment and jobs for them, and an income for the country! Well it is in a way but if they stopped relying on them and actually developed industries and stable economic factors, their country's economy would benefit more than relying on pocket money from the Corporations and bow to their demands and the Markets' moods.

Tax evasion is one of the main evils of the Capitalist system! It is the reason that so much inequality and poverty exists in the world depriving poor countries of valuable to them tax that could be used to lift them from poverty. But of course Ireland is not the only country to blame. How about Switzerland, Luxembourg, Cyprus and many other Pacific Islands and nations all over the World! This system is allowing rich to get richer and the poor poorer. It should stop but of course our leaders must agree to take action collectively as it is a Global issue. They do not, simply because it is easier to rely on others for quick and easy cash! Even France has a dodgy corporation tax system so technically they should not point the finger at the Irish!

In reality many things that should happen do not..Is it acceptable for Switzerland to be rich with other people's money? From taxes and money stolen by our corrupt elites that deposit them in accounts of their own.It is well known that many African leaders have bank accounts in Switzerland and other tax havens in the World while their people starve! I would not be surprised in European leaders do the same for instance!

What it should happen in Europe is a common agreement on this (I do not see it happening any time soon). The Germans and the French should not ask the Irish to abolish or reform their taxation system unless they change the way they do business too! Ireland and all small countries are always relying in their big neighbors financially so there is no wonder that they are striving to make deals and business with multinationals in order to keep their sovereignty (or so they think. What is the difference between being ruled by a powerful neighboring nation and being ruled by the Markets and multinational Corporations?).

When Ireland gained its independence from Britain, it was left with no money at all. They went from boom to bust and they remained dependent to the British economy for decades to come. Even the "Irish" pound was pegged to the British one and in fact was the same currency with a different name. When the British decided to join the EEC Ireland did so as well and they stay outside the Schengen agreement because Britain decided not to join, as they have a special agreement on their borders of Northern Ireland! Ireland in a way is still heavily dependent on Britain, as most UK firms are active on the Irish side of the border..

But why our European leaders are allowing small European nations to seek to strike deals with Multinationals, when in fact the solution would be to create pan European companies and industries that all nations would co-operate, invest and exploit! When a nation is striving to attract foreign investment, it agrees in a way to bend its laws to serve the will and interests of those companies or countries that show interest in investing in this small nation. It is a give and take situation. Thus this nation is not entirely sovereign anymore and in a European context it allows third parties and countries being able to influence their laws and EU laws in extent.

When Ireland agrees with American corporate companies to establish branches in its soil, it is relying on America to keep finding Ireland an interesting and convenient place for them to invest! To do that the Americans will place some rules and demands that Ireland must defend and promote sometimes even against EU law and regulations. And the same goes for the city of London and their corporate tax laws, Greece and the investment from China and all other states that do the same. Britain in particular supports this system; no surprise then why they always wish to opt out of EU regulations.

Why do this when we could set up and promote European owned companies that will work in many different European countries owned by Europeans! By investors, developers, inventors, scientists that are from all over Europe creating jobs for all our population, thus keeping our independence from third parties and other countries like America and China. Promoting stability and equal opportunities for all European citizens. What is the use of pointing the finger to each other like France and Germany are doing to the Irish, if they do not give them any alternative. Ireland now more than ever needs to find and keep any resources it can to save their economy. If the Germans and the French do not want to share with the Irish and include them in their industrial and economic development, then they will have to allow them to rely on foreign investment and to do that, in order to compete with other countries they will have to become a tax haven! There is no other choice for a small country like Ireland!

The solution to this problem lies on a European (and in fact a Global) level. No country should be pushed to change its taxation system if its partners are not willing to do the same and support each other. Will we ever see that happening? Our leaders know what needs to be done but I guess the honey in the jar is too sweet for some. And since the interests of so many powerful nations and people are involved we realize why this is so hard to achieve. Greed and a selfish approach to every problem hinders Europe for its full potential as our leaders think of their interests first and not what is the right thing to do. 

Until they cope on, I am afraid that Europe will remain unequal, divided, wasting money in supporting the poorer regions, troubled by unemployment, immigration and social issues and enslaved by rich companies and individuals, often coming from ashore...!! Not the vision I have for the future of our children!
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