Ireland Firm to Stay in Bulgaria-Led League of Low Corporate Tax

Finance | November 21, 2010, Sunday // 16:37|  views

A file picture of a man walking past a Anglo Irish Bank in Dublin, Ireland, in November 2010. Ireland currently has the lowest corporate tax in the eurozone and the third-lowest corporate tax rate in EU, after Bulgaria and Cyprus. Photo by EPA/BGNES

Ireland will not be forced to raise its corporate tax rate, one of the lowest in Europe following Bulgaria and Cyprus, in return for a European Union-led bail-out, the country's finance minister has assured.

"It would not be a criteria of the external assistance that the country raises its low corporate tax rate," Brian Lenihan said in an interview for RTE radio.

Meanwhile the Sunday Telegraph reported that some of the biggest US companies had warned the Republic of the "damaging impact" if the corporate tax rate was raised.

Microsoft, Hewlett Packard, Merrill Lynch and Intel were among those to warn of the risk to the country's "ability to win and retain investment", the paper said.

Earlier in the week analysts voiced fears that Ireland could be required to charge higher taxes on companies, which they say would seriously damage the country's prospects on generating economic growth going forward that it needs to get the budget back in balance.

Ireland currently has the lowest corporate tax in the eurozone and the third-lowest corporate tax rate in the European Union, after Bulgaria and Cyprus.

Ireland's corporate tax rate currently stands at 12.5%,  much lower than the EU average, but still higher than Cyprus and Bulgaria.

Bulgaria has the lowest personal and corporate income tax in the EU at 10%, which was introduced at the beginning of 2008, replacing the previous system, which combined several different tax rates - between 20 and 24%, depending on income.

Bulgaria also has the lowest social security rates, which coupled with a 10% flat rate, makes it very attractive for physical entities, employers and potential investors.

We need your support so can keep delivering news and information about Bulgaria! Thank you!

Tags: Republic, Cyprus, Bulgaria, bailout, Eurozone finance ministers, Simeon Djankov, European Commission, European Central Bank, IMF, Dublin, ireland, EU-IMF troika team, ECB, International Monetary Fund, Patrick Honohan, Irish government, corporate tax rate, debt crisis, Brian Lenihan, finance minister, Republic of Ireland, Eurozone, European Union


» Related Articles: