Taxation issues are back in the spotlight with the expectation that Donald Trump's ambitious tax plans could be signed into law as soon as tomorrow. Elsewhere, the European Commission announced yesterday that it was investigating Ikea's tax arrangements with the Dutch authorities.
Brian Keegan, Director of Public Policy and Taxation with Chartered Accountants Ireland, said there were striking similarities between the Ikea case and the Apple-Ireland example. "The European Commission has a clear preference for household names, for companies that everyone knows about. It's about multinationals channelling money into different territories. It's the country that's challenged and not the company, but inevitably the country will get involved in the process," he explained.
"A debate about how much multinationals should pay is legitimate. However, when it comes to issues about where tax ends up being paid, that's a different matter, and arguably the EU is encroaching on a country's sovereignty and that's why Ireland has appealed the EC ruling regarding Apple," Mr Keegan added.
On the US tax changes that are rapidly approaching the finish line in Washington, Brian Keegan said they should be of concern to us, despite claims that we will be largely unaffected by the Trump tax plan. "The Finance Ministers of the five largest EU economies wrote to the US Treasury saying they're deeply uneasy with the changes because they will suck revenue from their exchequers. If they're worried, there are grounds for Ireland to be worried."
However, he said the single greatest concern in terms of multinational investment is not featuring in the final version of the bill. "This was a proposal for a form of excise tax that would mean the largest multinationals would pay a share of the profits earned in Europe back into the US. That provision is missing," he concluded.
MORNING BRIEFS - The Dow Jones, the Nasdaq and the S&P 500 all hit record highs yesterday as traders anticipate a first major legislative victory for the Trump administration, almost a year into its existence. US markets have been surging all year as traders awaited the introduction of business friendly measures by the regime. The Dow Jones - which started the year at just under 20,000 - approached 25,000 yesterday. The tech heavy Nasdaq index went above 7,000 briefly for the first time ever before settling back just below that level.
*** Dalata Hotel Group has said it expects full year earnings to be in line with market expectations. In a trading update, it describes the outlook for 2018 as encouraging with a pipeline of almost 1,300 rooms set to open across the UK and Ireland. It confirmed the acquisitions of 62 rooms at Clayton Hotel Cardiff Lane for €8.7m and a further 18 rooms at Clayton Hotel Liffey Valley for €2m, in line with its strategy to buy out remaining freehold interest.
*** Ryanair shares are up over 2% in early trade having registered big fall in the last two sessions. Over €2 billion has been knocked off the airline's market capitalisation since Friday when it announced that it would recognise unions for the first time. The first meeting between airline management and union Impact is scheduled to take place today.