The representative organisation for US companies invested in Ireland has attacked the Government’s reluctance to lower personal tax rate levels, coinciding with Finance Minister Paschal Donohoe ruling out reductions in next month’s budget.
In its pre-budget submission, the American Chamber of Commerce Ireland said a competitive personal tax regime is vital “as a means to retain and attract FDI [foreign direct investment]”.
The Chamber said that Ireland’s personal tax rate is among the highest among FDI competitor countries, when the higher marginal income tax rate of 52% is combined with PAYE/PRSI and USC – and is “uncompetitive for a traded economy reliant on a highly mobile labour market within Europe”.
“While there is acute awareness of the Brexit threat, we view FDI – and US FDI, in particular – as a potential buffer for the Irish economy, which needs to be protected and nurtured,” said Chamber president Mark Gantly.
“It is important for Ireland to recognise and act upon the opportunity that Brexit presents for FDI in Ireland. We have a unique offering and we must not lose sight of this among all of the Brexit uncertainty,” he said.
The American Chamber also called for an acceleration of the Government’s Project Ireland 2040 infrastructural improvements programme, saying a resolution of the country’s infrastructure bottlenecks – including housing, roads and broadband – is “extremely urgent” if Ireland is to maintain its status as a ‘go to’ country for FDI.