IRELAND IS emerging as a beneficiary of the clampdown on tax havens by the Obama administration with the decision of New York-listed consulting firm Accenture to move its corporate headquarters to Dublin from Bermuda.
The move by Accenture, which already employs about 1,400 staff here, comes in spite of the fact that the White House listed Ireland as one of three jurisdictions accounting for a major portion of foreign profits made by American corporations, when President Barack Obama moved to reform US tax rules earlier this month.
The only other locations mentioned at that time by the White House were the Netherlands and Bermuda, where Accenture has had its headquarters since the structure of its business was changed in 2001.
“We have become concerned that the ongoing criticism of companies that are incorporated in Bermuda has raised questions that we need to address,” said Jim McAvoy, an Accenture spokesman.
Accenture’s proposed move, which is subject to shareholder approval, comes as a rising number of British companies relocate their headquarters to Ireland.
Advertising group WPP, which moved here in protest at Britain’s corporation tax regime, holds its annual general meeting next week in Ballsbridge, Dublin.
In a statement yesterday, Accenture chairman and chief executive William Green said the move to Dublin will provide the company with “economic benefits” and help ensure its competitiveness.
While Accenture will establish a new corporate support team in Dublin, the company declined to say how many staff the unit will employ.
“A member of the European Union, Ireland offers a sophisticated, well-developed corporate, legal and regulatory environment,” Mr Green said.
“It also has a long history of international investment and long-established commercial relationships, trade agreements and tax treaties with European Union member states, the United States and other countries around the world where Accenture does business. In addition, Ireland offers a stable political and economic environment and has the financial and legal infrastructure to meet Accenture’s needs, both today and in the future.”
Although numerous international businesses locate operations to Ireland to avail of the comparatively low 12½ per cent rate of tax on business profits, Mr McAvoy said Accenture’s offices in 52 countries would continue to pay tax in those locations in line with the profits they make there.
Accenture argues that the scale of its international operation is such that it should be described as a global corporation rather than a US business.
As such, it says it is not a target of Mr Obama’s campaign to increase taxation in the US of profits made abroad by US corporations.
The Government has introduced numerous tax advantages to encourage international companies into Ireland. In the Finance Bill this month, which gave effect to the emergency budget, companies were given an opportunity to write off the cost of acquiring intellectual property assets against taxable profits for 15 years.
