Washington DC.– On September 16, the National Foreign Trade Council (NFTC) gathered business leaders and government officials at an event to discuss the factors that have contributed to Ireland’s growing recovery. At the event, attended by Irish Ambassador to the United States Anne Anderson, participants welcomed Ireland’s continuing commitment to a competitive tax policy that supports business. However, concern was expressed that Ireland’s favorable business environment risks being undermined by erosions of intellectual property (IP) protections, such as the Irish government’s plain packaging proposal.
Leading off the event, Ambassador Anne Anderson noted that the pillars supporting Ireland’s exceptional foreign direct investment performance were the “Four T’s”: 1) Talent, 2) Tax, 3) Track Record and 4) Technology. In defense of Ireland’s corporate tax regime, the Ambassador commented, “We play fair, but we play to win … our 12.5 percent corporate tax rate is not in doubt.”
The Ambassador noted Ireland would carefully watch the ongoing work of the OECD on taxation, but commented that tax policy was Ireland’s “sovereign right.”
Panelist Chris Padilla of IBM noted that while tax was a key factor in making investment decisions, IBM invested in Ireland because “it is across the board a good place to do business.” Padilla also raised concern with the OECD’s BEPS project as “a way of getting countries to raise taxes.”
NFTC President Bill Reinsch moderated a discussion by a distinguished panel of business, academic and government representatives, including Chris Padilla of IBM, Jeff Schott of the Peterson Institute for International Economics, Christine Bliss of the Office of the U.S. Trade Representative (USTR) and Pat Howlin of the Industrial Development Authority (IDA), Ireland’s inward investment agency.
Pat Howlin of IDA commented that when considering investment decisions, multinational businesses seek “stability, certainty and confidence in the medium to long-term future.” Howlin highlighted the importance of balanced regulation: “Regulation is an important part of our efforts to promote business in Ireland, and it should not shackle business development.” When challenged on the plain packaging proposal, Howlin said that this was not his area of expertise but that he was aware of the government’s proposal.
Concerns were raised about Ireland’s protection of IP rights. NFTC President Bill Reinsch noted concerns raised by his members about a fifth “T” – trademarks – and Ireland’s proposed move regarding plain packaging of tobacco products: “The two issues that matter most are tax policy and intellectual property protection. IP protection is critical for attracting investment. It is the crown jewel of the American economy and key to our global competitiveness … As well as positive stories, Ireland also faces challenges … for example, Ireland’s proposal on plain packaging for tobacco products, which sends a negative signal to other industries contemplating investments.”
The panel also discussed the Transatlantic Trade and Investment Partnership (TTIP), a key focus of U.S. and EU economic policymakers. Christine Bliss of USTR noted that U.S. objectives in TTIP can complement Irish policies and highlighted Ireland’s leadership role in the negotiations. Jeff Schott of the Peterson Institute commented that while the TTIP agreement may create significant opportunities for U.S. and EU businesses, companies should not think it will enter into force anytime soon. Schott stated, “Businesses should integrate TTIP into their plans, but evaluate the agreement as a medium-term prospect at best.”
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