Anyone who willingly reads the business and finance pages in Ireland's newspapers is asking to be scared. Skyrocketing unemployment, bankrupt banks and a state that is piling up debt, which is getting pricier by the day. On top of that property prices are still tanking and a survey published yesterday claimed Ireland was the worst place to live in Europe. Unsurprisingly, people are streaming out of the country at a rate not seen here in two decades.
Bad news all around. Well, not quite everywhere. We still have Google.
Google's European headquarters are in Dublin, where they employ more than 1,500 people. The other day Google Ireland posted its accounts for 2009 and the results can only be described as tremendous. Revenues, profits and employment were all up last year.
Not only did the number of employees rise, but so did the average salary, up from €64,000 ($85,000) to €72,000 ($96,000). And that doesn't include the stock options that the staff received, which totaled €17m ($22.7m). All of this at a time when hundreds of thousands have been laid off, and just about everyone else has had to take pay cuts.
Google is a great story for Ireland, but there are those within and without who don't see it that way. Google like all companies operating here pay the corporate tax rate of 12.5% on their Irish earnings, which is a great enticement for them to stay here, but to some that rate of tax is too low.
Fortunately nearly everyone in Ireland supports this tax policy and other than a few cranky newspaper columnists nobody wants to increase the corporate tax rate. Irish people understand the footloose nature of business and employment in this globalized age and they believe we need to do all we can to keep Google - and all the other high-earning, high-paying employers from America and elsewhere - from going elsewhere.
No, the real threat to the corporate tax rate is external. There are those among our EU "partners" who would love to see us forced to change that tax rate to something more palatable to them, something around 30-35%, which would erode the only crumb of competitive advantage we have as an underpopulated, difficult-to-get-to island nation.
These people, who seem to be either French or German, see Ireland's difficulty as their opportunity to turn the screws even more. We're on our knees and, it's true, we're getting help from the big boys to stave off default, but the price some people want us to pay is too great. It would mean penury in perpetuity.
It's too high a price. We need to hold onto Google (& others) more than we need to stave off default and that means keeping our corporate tax rate LOW.
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