Cowen scraps ‘remittance’ tax scheme despite firm resistance

FINANCE Minister Brian Cowen yesterday announced he was pressing ahead with scrapping a generous tax arrangement that allowed foreign employees of multinational companies escape paying most of their tax on Irish income.

The so-called ‘remittance basis of taxation’ allowed non-domiciled employees of non-resident firms arrange their affairs so that most of their income from working in Ireland was paid outside the State to avoid paying income tax in Ireland.

Mr Cowen’s announcement in December’s budget that he was ending the arrangement led to an intense lobbying campaign from multinational companies and from the American Chamber of Commerce.