Minister O’Keeffe rules out corporation tax rate change in Budget

15 November, 2010

Ireland’s 12.5pc corporation tax rate will not change in next month’s Budget, the Minister for Enterprise, Trade and Innovation, Batt O’Keeffe TD, told a group of 38 leading firms based in the United Kingdom at an IDA Ireland dinner in the Irish Embassy in London this evening [Monday].

‘Ireland’s 12.5pc corporation tax rate is a vital draw for foreign direct investment (FDI) and it remains a key component of our industrial policy.

‘It is one aspect of taxation that will not change in next month’s Budget,’ said Minister O’Keeffe.

In a speech to the firms which spanned a range of sectors including financial services, life sciences, telecommunications, aviation, and media and entertainment, Minister O’Keeffe said the level of FDIs in Ireland is now back to pre-recession levels.

‘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,’ said Minister O’Keeffe.

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

Last year, almost one-third of FDI wins were from the UK.

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

‘The FDI pipeline for our two largest markets - the UK and US - is strong in the near term and it is important that we retain confidence in the enterprise economy which is showing very encouraging signs of recovery.

‘FDI generates more jobs per head of population in Ireland than in any other country and Ireland was the only country in the eurozone, bar Germany, to record an increase in export activity in the first half of this year.

‘Internationally, FDI was down 30pc last year but in Ireland it fell by just 4pc.

‘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,’ said Minister O’Keeffe.

ENDS

Bernard Mallee, Press Adviser to Minister Batt O'Keeffe, Department of Enterprise, Trade and Innovation, on Tel: +353 1 631 3944, Mobile: +353 87 9173022, Email: bernard.mallee@deti.ie