Risk to corporate tax take from tech slowdown

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The slowdown in the global tech sector poses a risk to soaring corporate tax receipts in Ireland next year and in particular in 2024, the Department of Finance's chief economist John McCarthy said today.

Corporate receipts, mainly paid by a small number of large multinational companies whose European headquarters are based in Ireland, have risen by over 400% in the last 10 years.John McCarthy said corporate taxes could reach €22 billion this year, above the €21 billion forecast two months ago, and that he was"more worried" about later years, especially if there is a shock to the ICT sector.

But since then a number of tech companies including Facebook parent Meta Platforms, Twitter and digital payments firm Stripe have laid off Irish staff as part of global cutbacks. A number of officials from the Department of Finance were appearing before the Public Accounts Committee. Mr McCarthy added that the NTMA"has €35bn of cash reserves it borrowed during the 0% that we've had", which will absorb the rate hikes in the short term.

 

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