Tax Law Update: 2013 Highlights

21 February 2014

In 2013 Ireland further enhanced its credentials as the leading low tax onshore OECD white-listed location.  International M&A activity was boosted by various US multi-nationals conducting acquisitions by inverting under Irish incorporated and tax resident companies.  Asset finance, particularly aircraft and ship financing using Irish incorporated companies, continued to grow, as did the use of Irish tax exempt funds for cross-border investment platforms.  Foreign investors into Irish property used various tax exempt platforms, including REIT's and Qualifying Investment Funds to buy property and other related assets in a tax-efficient manner.  Ireland also became only the fourth country worldwide to enter into a FATCA agreement with the USA.  Budget 2014 delivered and enacted in 2013 was accompanied by Ireland issuing its International Tax Strategy. 

Highlights for 2013 included: 

  • Maintaining and preserving Ireland's low corporate tax rate
  • Publication of Department of Finance of Ireland's International Tax Strategy 
  • Enactment of Finance (No. 2) Act 2013

Maintaining and Preserving Ireland's Corporate Tax Rate

Ireland's Minister of Finance, in his Budget speech on 15 October 2013, again reiterated Ireland's absolute commitment to its 12.5% corporate tax rate.  Ireland is committed to maintaining an open, transparent, stable and competitive tax regime.

International Tax Strategy

As the OECD project on base erosion and profit shifting gathered speed in 2013, Ireland took the opportunity of using its EU Presidency to advance the international tax reform agenda.  The Department of Finance also published Ireland's International Tax Strategy.

Finance (No. 2) Act 2013

Key features of the Finance (No. 2) Act 2013 included:  a cessation of the use of Irish incorporated companies as non-Irish tax resident where they might otherwise be regarded as Stateless.  This primarily impacted on a very limited number of US corporates that were exploiting a lacuna in US/Irish tax…