Ahern: Ireland’s Tax System Unsustainable

Bertie Ahern, the former Prime Minister of Ireland, has issued a warning that the country’s corporate tax system, which currently yields close to €24 billion in tax revenues, is not sustainable in the long term. He has forecast that other nations will increasingly challenge this tax rate out of frustration over revenue losses to Ireland. Ahern cites the European Court of Justice’s recent ruling in the €13 billion Apple tax case, which mandates that companies should be taxed based on the location of their profit generation, not their headquarters.

Speaking at a convention organised by several universities discussing the US’ part in the Irish peace process, Ahern expressed doubts about the sustainability of Ireland’s current system. He noted that multinational corporations have established complex tax schemes in Ireland, operating largely in the digital space. However, he pointed out that the real business is carried out beyond Ireland’s borders.

Ahern also touched upon the potential impact of former US president Donald Trump’s economic policies on Ireland, calling them a risk to everything developed in the nation during his lifetime. He stressed how heavily Ireland relies on foreign investment and free trade.

Without aligning with any party in the US elections, Ahern identified the potential effects of Trump’s proposed corporate taxation cuts and attempts to ensure multinationals contribute more in the US as a significant concern for Ireland. Ahern highlighted Trump’s third priority – incentivising multinational corporations to invest more heavily in the US and close taxation loopholes, with Ireland being one of the countries mentioned specifically in this context.

Projecting corporate tax revenues to rise to €37bn annually by 2030, Mr Ahern expressed concern over Ireland’s diminishing impact in Washington, recognising a diminishing bond between Irish America and its homeland. This comes in light of US President Joe Biden’s anticipated departure from his position next year. For many years, influential American politicians have played a key role in advancing Ireland’s interests on Capitol Hill. However, these dependable figures, epitomised by the influential Congressman Richie Neal, who chairs the House of Representatives’ Ways and Means Committee, can’t maintain their positions indefinitely. Highlighting the decrease in Ireland’s sway in Washington, Mr Ahern underscored the dwindling membership in the Friends of Ireland congressional group. Whereas once there were 50 or 60 American legislators in this group during the 1990s, those numbers have significantly declined, he noted.

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