The recent public scrutiny of the tax affairs of multinationals has had no adverse effect on Ireland’s reputation as an investment location the head of the IDA has said, as the agency concluded a three-day trip to Davos.
Speaking to The Irish Times in Davos, Martin Shanahan said that while companies were keen to hear details of the Government's planned Knowledge Development Box, the issue of taxation had not been raised during meetings with client companies. "I think what Ireland did in last year's budget set out a very clear roadmap for tax for Ireland. It is probably clearer in Ireland than it is in many countries. For those who raise the issue of tax, the question is around the Knowledge Development Box and what it will look like."
Potential clients
The IDA met with about 40 companies this week in Davos, including senior executives from
,
and Mastercard, while the Taoiseach hosted a dinner for existing and potential clients on Thursday evening. The three areas of focus for the IDA during the World Economic Forum were companies in the IT and technology, financial services and pharmaceutical sectors, Shanahan said, while the agency had met potential clients from
Asia
and
Europe
as well as the US.
“From an IDA perspective, Davos is an excellent opportunity,” Shanahan said. “Most of our key clients are here at Davos at a very senior level this week, while many of those we are targeting for investment are also represented at a senior level.”
Asked about research this week that highlighted Ireland’s lack of focus on vocational training, Shanahan said Ireland could not afford to be “complacent” though he stressed that the survey had ranked Ireland 10th out of 93 countries.
“We cannot be complacent. We need to ensure that we continually ensure that the output from the education system and the further education and training system meet the needs of both multinational and Irish companies’ needs,” he said, adding that the IDA works closely with the education sector through forums such as the expert group on future skills needs.
Speaking on the fringes of the world Economic Forum yesterday Taoiseach Enda Kenny said that the changes announced in the budget had brought clarity to Ireland’s position regarding tax. “Ireland is not afraid to be out front. We will play hard and we will compete hard but fair to win in terms of jobs and investment.” He said that the level of “integrity and trust” in Ireland was very strong.
“The fact that we have got rid of the Double Irish and of the stateless concept . The fact that we are participating fully and upfront with the OECD in terms of the BEPS analysis means that they know that Ireland is a leader and has absolutely nothing to hide here.”
Yesterday, governor of the Bank of England Mark Carney called on the technology sector to pay its fair share of tax. "Some of the firms that take advantage of international tax rules are the tech companies," he said during a panel discussion. "The amount of tax they pay is small in relation to the system. A sense of responsibility is needed."
Tech giants
Senior executives from Google, Facebook, Yahoo and other US tech giants were present this week in Davos. Google in particular is facing increased regulatory scrutiny in Europe where it is subject to an anti-trust investigation by the
European Commission
.
Despite the recent controversy over the Luxembourg Leaks scandal, Carney's comments were one of the few references to corporate tax arrangements during the three-day event. Jean-Claude Juncker, the European Commission president who was prime minister of Luxembourg when the tax deals revealed by the LukLeaks scandal were arranged, was notably absent from the forum.
