Ireland wins with Bush victory

SUNDAY TIMES -- Damien Kiberd points out that "bad news for Kerry is good for Ireland" because Kerry's plans for a new way to tax corporate profits could have gutted a big slice of Foreign Direct Investment (FDI) in Ireland. On the stump in Wisconsin, Kerry told small groups of workers that, once elected, it would not take more than a nanosecond for him to reverse the US tax laws that allowed big corporations to outsource production and record their profits in other jurisdictions. Kiberd followed the proclamations and offered a well-researched synopsis.

John Edwards, his would-be-vice-president, had been even more militant on the issue of overseas investment, having built his career around apocalyptic warnings of a US jobs drain to central and South America.

Kerry's big idea was to tax all US corporate profits at the domestic rate, whether those profits were earned at home or overseas.

At surface level, this would pose a huge problem for Ireland and the IDA's pitch for FDI, striking at the most potent weapoin in the agency's arsenal: the universal rate of 12.5% profits tax in this country. Not merely would it hit the flow of new projects, it would undermine the tax planning of existing American operations in Ireland, loosening the ties that bind them to what is, in economic terms at least, the 51st state of the union.

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Damien Kiberd -- "Bad news for Kerry is good for Ireland" in The Sunday Times Business Focus, November 7, 2004.
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