US multinationals have said they plan to advise the Government on what should be in the proposed "knowledge box" tax scheme, the Minister for Enterprise Richard Bruton has said.
Speaking on a five-day US trade mission, Mr Bruton said that US companies had not raised concerns in meetings about the Government’s decision to end the “Double Irish” tax avoidance scheme or that this might lead to a change in the 12.5 per cent corporate tax rate.
“People come to grow their businesses – tax is not what they come for,” he said.
He had received "very positive feedback" on the budgetary changes in meetings with US companies in Boston on Monday and the Washington DC area yesterday.
Companies had indicated that they would participate in the Government’s consultation process on the knowledge box, which will allow companies separate income from intellectual property and pay a different tax rate on it.
Knowledge box
The process would ensure the proposed “knowledge box” would “embrace the sorts of innovation that driving business change now,” he added.
He said there has been "a misunderstanding" of what drives corporate tax inversions, which have led US firms to be criticised for relocating to Ireland and elsewhere for tax purposes through takeovers.
“It is neither something that we want or cultivate,” he said. “It is the US regulations that drive it: there is scope for the US to change its regulations.”
Mr Bruton visited Virginia educational software company Ellucian, which last ye1ar agreed a deal with Cork company Akari Software.
His visit continues in Philadelphia today and New York on Friday on a trip involving meetings and events with 17 companies, mostly in the financial services, technology and healthcare sectors.
The Minister expressed optimism that the US and EU could still agree the Transatlantic Trade and Investment Partnership, the proposed deal between the two economic blocs, despite divisions on financial regulation, food production and data protection.
“This isn’t about ending up having on both sides of the Atlantic an identical set of regulations in the public interest because the public interest varies between the two sides,” heexplained.
Mr Bruton told an audience at the European Institute in Washington that reaching an agreement would be "tricky" but spoke about the momentum for the deal as "both economies need it."
Talks between negotiators
The seventh round of talks between negotiators working towards an agreement took place in Washington earlier this month.
Mr Bruton will meet lead US negotiator, trade representative Mike Froman today.
The Minister said that given the seven rounds of talks Mr Froman may have been “a little bit optimistic” when he said in Dublin on a visit last year that the agreement could be negotiated on “one fill of gas.”
