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08th Oct 2021

Corporation tax rate to rise from 12.5% to 15% in Ireland

Katy Thornton

Ireland was previously thought to have a low corporate tax rate in comparison with other European countries

The Minister for Finance Paschal Donoghue announced yesterday that Cabinet has approved an increase in Ireland’s corporation tax. It will rise from 12.5% to 15% for large companies that have a turnover over €750 million. This will affect multinational businesses such as Google, Facebook, Microsoft and many more. Those companies that make a turnover that is less than €750 million will continue to pay the 12.5% tax rate and this applies to the majority of Irish businesses.

This change has come from years of discontent regarding corporate tax rates. According to RTÉ News, “The frustration was borne from the digital era, where tech firms were able to make vast sales and profits across borders, without having a physical footprint in states.” These states were then unable to tax those companies on their profits. By increasing the tax for these large multinational companies, Ireland is attempting to make things a bit fairer.

If everything runs smoothly, this will come to pass in 2023.

Header image via Shutterstock

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