The value of services imports into Ireland in the second quarter of 2019 was €86bn – compared to €41bn a year earlier, according to official Central Statistics Office (CSO) data.
The surge was mainly made up of intellectual property – most likely software licences being shifted into Ireland by global technology funds for tax reasons. A similar surge occurred in 2017. Although huge in financial terms, these so-called “globalisation events” have a limited impact on overall growth data – because the cost of the imports is balanced out by an equal rise in investment.
But it highlights the distortions in Irish economic data as a result of corporate profit-shifting. The “double Irish” tax structure, a loophole exploited by multinationals to slash global tax bills by routing profits into and out of Ireland though complex inter-company structures will be shut from December 2020 in a move flagged since 2015.
Officials at the CSO said evidence suggests some multinationals that used the structure have been shifting assets into Ireland as they re-organise their structures, a trend set to continue into next year.
“Some companies have been early adapters while others have waited. There may well be more [massive IP imports].”
Officials could not say what ,if any, impact the IP imports are having on Irish corporate tax receipts, which have surged unexpectedly since 2015.
The latest CSO data shows Irish economic growth continued to power ahead in the second quarter of 2019 despite Brexit and the eurozone slowdown, though with some signs of a weak jobs market. Consumer spending – including on cars and holidays – remained strong, as did exports.
Ireland’s gross domestic product (GDP) rose by 0.7pc quarter-on-quarter in the second quarter and was up 5.8pc compared to a year earlier.
However, the country’s crown as the EU’s best-performing economy slipped, with Romania, Greece and Denmark clocking up faster expansions than Ireland in the period.
Finance Minister Paschal Donohoe welcomed the latest growth data. He’s been under pressure this week from the Irish Fiscal Advisory Council for loose budget controls and said the latest national accounts were evidence of solid and broad-based growth.
“Overall growth in the economy continues to be broad-based, with positive contributions from the domestic and multinational sectors. Early indications suggest solid growth in the third quarter as well,” Minister Donohoe said in a statement yesterday.
- Home Staging - The New Wave in Real Estate
- Goal Setting - Being Realistic
- Home Staging - 5 Secrets To Set Your Orlando Or Central Florida Home Apart From The Rest
- Goal Setting Success - Practicing Your Future Perfectly
- 10 Tips For Great Goal Setting
- The Importance Of Home Staging In Austin
Ending of 'double Irish' sets stage for surge in IP imports have 430 words, post on www.independent.ie at September 13, 2019. This is cached page on Talk Vietnam. If you want remove this page, please contact us.