“Ireland on Tuesday sought to shore up its international image by announcing plans to end a corporate accounting rule that permitted hundreds of U.S. multinationals with European bases in Ireland to shift their non-American profits between two Irish-registered companies and avoid tax,” Shawn Pogatchnik reports for The Associated Press. “Finance Minister Michael Noonan declared that the tactic called the ‘Double Irish’ would be outlawed for new applicants from Jan. 1. Existing beneficiaries — among them scores of global pharmaceutical and technology giants including Apple and Google — would have until the end of 2020 to find different shelters.”
“The change came as Ireland unveiled its first expansive budget Tuesday since the collapse of the Celtic Tiger economy six years ago, ending an era of austerity earlier than expected thanks to the return of Europe-leading growth,” Pogatchnik reports. “Measures unveiled in the 2015 budget will increase spending and tax breaks by a combined $1.5 billion, including a plan to build 6,700 state-funded homes for the poor as Ireland seeks to stimulate even more tax-driving growth. The U-turn follows seven hard-cutting budgets that, when combined, took nearly 30 billion euros annually — representing nearly a quarter of previous domestic demand — out of a shell-shocked economy.”
“Noonan said that even with Tuesday’s plans to cut income tax and boost spending, Ireland still expected to post a 2015 deficit of 2.7 percent of GDP,” Pogatchnik reports. “Among dozens of tax tweaks, Noonan said Ireland’s top income-tax band would drop to 40 percent from 41 percent, and the level that it kicks in would rise by 1,000 euros to 33,800 euros ($43,000). He raised the starting point for lower levels of income tax to take 80,000 more low-paid workers out of the tax net. The only new tax: another 40 cents on a pack of cigarettes, raising their average price to 10 euros ($12.70).”
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