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The direct and indirect tax debate

Posted on by Sean Whelan

The European Commission has tax policy in its sights

The Nevin Institute’s report has sparked another debate about the country’s taxation system for individuals

By Sean Whelan, Economics Correspondent

ADDENDUM

Since we posted this blog Micheal Collins of NERI has posted a response to some of the issued raised here and elsewhere (see the IrishEconomy.ie thread especially).  It’s worth including all of it here, especially as it is in the form of a Q&A, so it is user friendly.  As we said, it has certainly kicked off a good debate.  The new NERI Q& A is further down the page, after the original blog post.

The Nevin Economic Research Institute seems to have kicked over a hornets nest with its latest version of a working paper claiming that top and bottom income deciles pay about the same proportion of their income in tax.

The premise is that while income tax is very progressive in Ireland, indirect taxes such as VAT tend are regressive.  Continue reading

Why Amazon paid $970m for Twitch

Posted on by Will Goodbody

 

Amazon already offers gaming services through its Fire TV set-top box

Amazon already offers gaming services through its Fire TV set-top box

By Will Goodbody, Science & Technology Correspondent

@willgoodbody

The owners of Twitch must be feeling pretty smug this morning. Last night they sealed a deal which will see them sell their mere three year old streaming service for just shy of $1bn. But while the price tag may be surprising to many, the buyer is even more unexpected. Because until a few months ago Twitch was reportedly in talks with Google with a view to a prospective tie-up.

So why Amazon, and why $970m? Few outside the world of gaming will know much about Twitch. But if you are a gamer, you’ve probably spent countless hours of your life using it. Twitch is a  video service for games, allowing them to stream and upload their gaming activities as they play to potentially millions of viewers who can follow every explosion and carjacking in real-time. A non-gamer might ask why? The 55 million unique visitors to the site, who together viewed over 15 billion minutes of content, would clearly respond why not?

Continue reading

Interest rates will rise – it is just a question of when

Posted on by David Murphy

ecb

Many households have managed to pay their mortgages due to the substantial cut in ECB rates.

Central bankers in the euro zone, UK and US frequently adjust interest rates in unison.

That is not due to a herd instinct, but when conditions in one region merit higher or lower rates similar circumstances are often occurring elsewhere. Continue reading

Lessons from the banking crisis quickly forgotten

Posted on by David Murphy

 

portugal

Portugal’s Banco Espirito Santo went bust with losses of €3.6 billion

They say history repeats itself for those who were not watching the first time.

One lesson from the Irish banking collapse was putting the burden on the tax payer while senior bondholders got all their money back was an unfair, dangerous and destabilising error.

Ireland fully repaid senior bondholders who had lent money to the banks. That cost so much it was one of the reasons why the country had to be bailed out by the EU and IMF.

The experience in Ireland prompted Europe reconsider how banks should be rescued and who should pay.

Continue reading

Fermanagh fracking fight perhaps a taste of things to come

Posted on by Will Goodbody

The government here has asked the EPA to carry out a study into fracking

The government here has asked the EPA to carry out a study on fracking

By Will Goodbody, Science & Technology Correspondent

@willgoodbody

In Belcoo, County Fermanagh opponents of fracking must be collectively exhaling. Over the past few months they took on Goliath. And yesterday they won – for now at least.

For months protests had been building there against an application by energy company Tamboran Resources to drill a fracking exploratory bore hole. Fracking involves the cracking open of deeply buried shale rock using high pressure fluid, which in turn releases gas that is then brought to the surface.

Tamboran estimates there could be up to £20bn worth of gas in the area around the border between Fermanagh and Leitrim. The problem is, however, the only way to get the gas out is from the northern side of the border, because fracking licences are currently not being issued by the government here while an in-depth study is being carried out.

Tamboran wanted to explore how much gas is under the ground there, by drilling a 750m deep hole in a quarry near Belcoo. It wasn’t planning to carry out fracking – just do some tests.

Continue reading

Three reasons to look to the stars

Posted on by Will Goodbody

A supermoon rises next to the ancient Greek temple of Poseidon at Cape Sounion, some 65 kilometers south of Athens.

A supermoon rises next to the ancient Greek temple of Poseidon at Cape Sounion, some 65 kilometers south of Athens

By Will Goodbody, Science & Technology Correspondent

@willgoodbody

It’s been an exciting week for star-gazers, with the remarkable rendez-vous between the European Space Agency’s Rosetta probe and comet 67P/Churyumov–Gerasimenko. For a man-made object to travel 6 billion kilometres unscathed around the solar system over a decade and still manage to catch and begin orbiting a 4 kilometre target moving at 55,000 kmp/h is extraordinary. And happily, the best is yet to come, as Rosetta prepares to monitor and send a lander down onto the comet’s surface – unlocking, it’s hoped, wonderful secrets about life.

But back on Earth, the space fest is set to continue this weekend. Because Sunday and the early days of next week could end up being a super celestial showcase. According to the Irish Astronomical Association (IAA), on August 10th Ireland will enjoy its best SuperMoon until 2018, followed two days later by the peak of the Perseid Meteor Shower and a great series of passes by the International Space Station.

Continue reading

Big banks back on the rise

Posted on by David Murphy

The billions poured Anglo and Irish Nationwide will never be seen again

The billions poured Anglo and Irish Nationwide will never be seen again

By Business Editor David Murphy

The country’s three biggest banks, AIB, Bank of Ireland and Ulster Bank, released financial results this week. All three are making progress (thanks to bailouts from Irish and British taxpayers.)

There are some common themes across all three.

They are making profits, their margins are improving and the amount they are setting aside for bad loans is also declining.

That is good news for bank shareholders. The State owns 14% of Bank of Ireland and 99% of AIB.

Continue reading

The hard reality of the Irish software industry

Posted on by Will Goodbody

Around half of all software vacancies here are filled through inward migration

Around half of all software vacancies here are filled through inward migration

By Will Goodbody, Science & Technology Correspondent

@willgoodbody

Warnings about a skills shortage in the IT sector are nothing new. We’ve been hearing them for years now, mostly from the industry itself. Nor are they unique to Ireland. Because as the internet flourishes and technology becomes ubiquitous, the global demand for IT skills is rocketing, everywhere. Indeed the manpower shortage will be a little shy of 1 million people by the end of next year in Europe alone, according to a recent estimate from the European Commission.

But when an in-depth academic study of the software industry in Ireland finds the problem is so severe that thousands of new jobs set to be created by Irish based businesses over the coming months and years could end up in foreign countries, it’s worth taking note. Particularly at a time when unemployment remains close to 12%.

Continue reading

Can Noonan stay cautious over cuts?

Posted on by David Murphy

Michael Noonan has to decide the extent of cuts in Budget 2015

Michael Noonan has to decide the extent of cuts in Budget 2015

By Business Editor David Murphy

There is an interesting dynamic unfolding as the lobby groups bombard the Department of Finance with their demands regarding the upcoming Budget.

In some respects, there is a race to the bottom to recommend the smallest amount which might be needed in extra taxes and spending cuts. Continue reading

Five things we learned at ESOF 2014

Posted on by Will Goodbody

CERN DG Rolf-Dieter Heuer speaking to RTÉ News at ESOF

CERN DG Rolf-Dieter Heuer speaking to RTÉ News at ESOF 2014

By Will Goodbody, Science & Technology Correspondent, in Copenhagen

@willgoodbody

For those addicted to science, ESOF 2014 in Copenhagen was the perfect fix. For six days, the Danish capital was transformed into a city of science, attracting around 4,500 delegates from all over the world. There were hundreds of lectures, discussions, exhibitions, demonstrations and side events, on science itself, the policies underpinning it, the careers around it, the links to business and even the art the flows from it.

Science is all about discovery, and while at ESOF we found out many things over the course of the week. Among them:

1. CERN: Ireland seems to be inching closer to joining CERN – or at least that’s what the Director General of the European particle physics centre seems to think. On Monday, Rolf-Dieter Heuer told us he was seeing positive signals from Ireland about our possible membership. Of course, that may be optimistic thinking on his behalf. We’ll hopefully know more in the coming months, when the government review of Ireland’s membership of international scientific and research bodies is complete.

2. ERC: The EU’s main frontier research funding arm, the European Research Council, still thinks Irish scientists are not doing well enough when it comes to winning grants from it. The ERC levelled the same criticism at us two years ago when ESOF was in Dublin. But it seems, from the council’s perspective, little has changed in the interim. Interestingly its President, Professor Jean-Pierre Bourguignon, claimed part of the blame may lie with Ireland’s policy on science funding, which he suggested could be too heavily weighted towards research that yields jobs. That’s likely to be the feeling of scientists here, many of whom feel they are held back by our focus on commercialisation. Undoubtedly, the government would disagree.

3. Advisors: Until this week, the various chief scientific advisors to governments around Europe had never met formally. It’s hard to believe, isn’t it, given the pivotal role science and innovation plays in the European economy, and the key part the advisors would play in the event of a cross-border crisis? Like for example the contamination of beef products with horsemeat. This week they met for the first time at ESOF after Anne Glover, the European Commission’s first chief scientific advisor, finally managed to get the European Science Advisers’ Forum (ESAF) up and running. The idea is that it will lead to a more evidence based approach to scientific decisions taken in Europe. That can only be a good thing.

4. Museum: Dublin is badly missing a proper permanent venue where young and old can explore science, like the magnificent Experimentarium in Copenhagen. Dublin is fortunate to have the Science Gallery, which has small but excellent rolling exhibitions focused on the collision of science, innovation and art. But Dublin badly lacks a permanent centre of interactive scientific exploration, experimentation and discovery, like London’s Science Museum and Belfast’s W5.

5. Scientists love to party: Science is often unfairly labeled as being populated by boring nerds, who like nothing more than a quiet night in, with a good scientific journal, and a glass of fizzy water. But that couldn’t be further from the truth. And one of my abiding memories of ESOF 2014 will be seeing a conga line made up of around 150 scientists snaking its way around the Copenhagen venue where the official ESOF night party was taking place!

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