Cutting tax rate - Race to the bottom

The employers group Ibec wants the Government to consider cutting Ireland’s 12.5% corporation tax rate in response to the UK’s plan to cut their rate to 15%.

Britain has already come under attack as a result from France and Germany, which are concerned that the UK will be tempted to establish itself as a low-tax offshore jurisdiction on the fringes of the EU.

The Taoiseach has already demonstrated how seriously he views the situation by setting up a new division in his department and chairing a new Cabinet committee to deal with the implications of Brexit.

That decision is to be welcomed but whether we should join the UK in a race to the bottom in terms of corporate tax is another matter.

We are already under pressure from our EU neighbours over current rates. Any further reduction could antagonise them, thereby lessening our chances of being recognised as being the EU country most affected by Brexit.

Calm heads must prevail.