2024-01-01 20:37:57
Dublin : Revised corporation tax rates in force in the country as per the OECD treaty system to which Ireland is a signatory. Accordingly, hundreds of companies in the country will have to pay increased corporate tax. Government sources indicated that this would be the biggest increase in three decades.
Ireland signed the Organization for Economic Co-operation and Development (OECD) agreement in 2021, which set the minimum tax rate for large multinational companies at 15%.
It is estimated that around 1,600 multinational companies in Ireland will be affected. The corporation tax rate in Ireland has been 12.5% for 20 years. Along with Ireland, 140 other OECD countries are signatories to the OECD agreement.
Companies with a turnover of more than Rs 750 crore for at least two years in the last four years will have to pay top-up tax. But the government has allowed the vast majority of businesses in Ireland to remain on the 12.5% tax rate for two years (until 2026).
Low-tax countries like Ireland have provided opportunities for tech giants to reap profits. It was widely criticized and controversial. Following this, the OECD introduced a comprehensive change in corporate law.
It is observed that Ireland will benefit greatly from the introduction of the new tax rate. Finance Minister Meehol McGrath has welcomed the introduction of the new Corporation Tax Act.
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