O'Keeffe 'Rules Out' Corporation Tax Change

Ireland's highly competitive 12.5% corporation tax rate will not change in next month's Budget, according to the Minister for Enterprise.

Batt O'Keeffe is to make the announcement tonight to a group of 38 leading firms based in the United Kingdom at an IDA Ireland dinner in the Irish Embassy in London this evening.

In an effort to maintain foreign investment, Mr O'Keeffe is expected to tell the delegation that Ireland’s corporation tax rate is a vital draw for foreign direct investment (FDI) and that it remains a key component of Ireland's industrial policy.

"It is one aspect of taxation that will not change in next month’s Budget," he will say.

The sectors attending will include financial services, life sciences, telecommunications, aviation, and media and entertainment.

In his speech, Minister O’Keeffe will say that the level of FDIs in Ireland is now back to pre-recession levels with almost one-third of FDI coming from the UK Last year.

"A combination of improved competitiveness, our corporation tax rate and decisive corrective measures on the public finances, coupled with other factors such as language, education and skills base, has allowed Ireland to out-perform other larger nations for FDIs."

More than 7,800 workers are employed by 106 UK firms in Ireland - making it our largest source of FDI after the US.

UK firms with major investments in Ireland include Vodafone, GlaxoSmithKline, HSBC, BT and Barclays.

His speech, published ahead of time on the Fianna Fail website says: "We must have confidence in our ability to reach the goal of sustainable economic export-led growth.

"In the enterprise economy, there are very encouraging signs that we can get there."

(DW/BMcC)