2015 tax changes costing Ireland over €10 billion - Peadar Tóibín TD
Sinn Féin TD Peadar Tóibín called on Michael Darcy to explain why Michael Noonan in 2015 introduced a 100% tax break on the profits generated from the on shoring of intangible assets.
This will cost Ireland €8.5 billion euro, with another €2 billion arising from additional EU budget contributions of €200 million a year for ten years.
He also asked why Finance Minister Paschal Donoghue had refused to apply his subsequent rate of 80% to the surge of intangible assets that occurred before budget day this year.
Speaking during a Dáil debate on the Paradise Papers today, An Teachta Tóibín said:
“Tax income inequality is by far one of the most damaging aspects of the current economic climate in the world. According to Oxfam just eight men own same wealth as half the world.
“There are 1,876 billionaires in the world, while tonight a billion people go to bed hungry without proper food, shelter, health care and education.
“This is not just an international problem it’s an Irish problem. The most affluent 20% in Ireland own 73% of the country’s wealth and the poorest 20% own just 0.2%. The top 5% in Ireland, their combined wealth is double that of the whole of the “squeezed middle”.
“Tax injustice is one of the main drivers of this. It is also at the heart of policy decisions of Fine Gael, Fianna Fáil and Labour over decades. We know through the Apple Tax crisis that it has cost us billions of euro in tax forgone alongside wholesale reputational damaged.
“However it is still happening. Economists have identified that the refusal of both Michael Noonan and Pascal Donoghue to apply an 80% rate to capped Capital Allowances linked to investment on Intellectual Property before budget day, will cost €850 million in tax forgone a year. Furthermore the state is on the hook for €200m a year in extra EU budget contributions on the back of the hocus-pocus 25% GDP surge that Noonan’s tax break facilitated.
“The question of why did Fine Gael do this and why won’t they reverse it has still not been answered.”