Michael Noonan: No threat to 12.5% corporate tax rate

The European Commission is not demanding any changes in Irish tax laws over the Apple arrangement condemned by Brussels, Minister for Finance Michael Noonan said yesterday.

Mr Noonan said what had occurred was now being regarded as a historic issue and there is no pressure to alter the 12.5% corporation tax or other tax incentives available in this country.

“It’s part of the Irish offering now for years,” said Mr Noonan. 

“We could nearly put it on the flag now, because everybody knows what the rate is. When industrialists think of Ireland, they automatically think of 12.5%. Just in case there’s any doubt, I’ll confirm it again in this year’s budget. 

"We are under no pressure. The European Commission acknowledge that the right to set tax rates is a matter for sovereign governments; it’s not for Europe or the European Commission. So there’s no pressure on us.”

Mr Noonan, who was speaking at the announcement of 100 new jobs in Limerick by US digital website hosting service provider, WP Engine, said employment has now grown to just 100,000 below the level at the height of the Celtic Tiger era.

“Over the past year, more than 56,000 additional people are at work — bringing those at work to more than two million,” he said. 

“The Celtic Tiger was a false economy built on one sector, building and development. The difference now is that in job creation, the economy is growing across all sectors.”

Asked if it is his aim to remain in the Cabinet until the next election, Mr Noonan said: “Well, we don’t know when the next election is. So you are asking me to make a commitment to a target which nobody knows when that target will be. 

"We’ll wait and see. I took on a job and I’m doing the job and will continue to do it.”

Heather Brunner, CEO of WP Engine said the company’s decision to come to Limerick was based on its objective to have a presence in cities which are successful.

Ms Brunner said: “Limerick has a terrific environment and culture where the community, government, and business leaders are committed to building local talent and creating a technology innovation and incubation centre. We want to help further build and be part of that ecosystem.”

On the budget, Mr Noonan said that while there are now different views which have to be taken into account, so far these views did not seem to be in conflict in any dramatic way.

“So I am quite confident that we’ll put a good budget through,” he said.

The views of three independent Cabinet ministers along with the Fine Gael parliamentary party and Fianna Fáil, will influence budget decisions, said Mr Noonan.

“In terms of putting a budget in place, a lot of views will have to be taken into account,” he said.

Asked if he was worried Micheál Martin might come knocking on his door saying his time is up, after the budget, Mr Noonan replied: “There’s no sign of that. You had better ask Micheál Martin that. I don’t think he knows where I live, so he’ll have difficulty knocking on the door.”

During a visit to London last week, Mr Noonan said his department will produce its next growth forecasts for the Irish economy, ahead of the upcoming budget and Brexit will be a key factor underlying Budget 2017, with particular reference to competitiveness.

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