Budget 2022: “Their number one concern” – International investors are closely monitoring developments in corporate taxation, says NTMA chief
INTERNATIONAL investors are monitoring Ireland’s corporate tax developments “very closely” and this is “their main concern at the moment”, Dáil’s public accounts committee was told. .
onor O’Kelly, Managing Director of the National Treasury Management Agency (NTMA), said: “What we’ve tried to do is tell policymakers what we’re hearing from investors.
Any threats, changes in corporate taxes and the uncertainty surrounding Ireland’s “core business model” to attract multinational companies are understandably a concern for them, he said.
“It’s their number one concern right now. They are monitoring developments very, very, very carefully, ”O’Kelly told PAC members.
He said Ireland has this “twin-engine economy”, involving the national economy and major foreign investors.
“What really matters is not what I think, but what our investors who spend money think,” he said. “What do they think the risks are for Ireland and how do they see those risks. “
Asked by Brian Stanley, chairman of Sinn Féin’s public accounts committee, about the potentially significant revenue implications if there was a 15pc floor, Mr O’Kelly said it was difficult to say.
“First of all, I think it’s too early to tell. It’s a very complex business and there’s a lot we don’t know yet about how it might turn out.
“We know the ministry has a provision in place that they believe the impact will be € 2 billion per year in the potential long-term impact.”
Mr O’Kelly added: “I think that’s a reasonably conservative forecast to take – but it’s far too early to tell, the devil is in the details.”
There is still so much negotiation to be done at the international level “that we don’t know”, he said, “but I think at the same time Ireland is a great place to do business”.
He added: “We know that multinationals are not here just for tax reasons. “
He gave the example of recent transactions with Stripe, the electronic payments company run by the Limerick-born Collison brothers.
“They are very committed to Ireland in terms of jobs and their second seat,” said Mr O’Kelly. “But taxes are never mentioned in any of the conversations we’ve had with them about Ireland as a jurisdiction or somewhere they want to do more business.
“So I don’t think I’m exaggerating the ultimate impact of this, if it’s happening along the kind of streetcar lines we’re talking about now,” he said.
Mr Stanley commented: “So any additional tax of two and a half percent doesn’t terrify them, I think that’s what you’re saying.”
He added, “I know you are talking to people who will be affected by this and have a particular interest in it. So you know about it, maybe more than many of us.