Tax Exemptions and Tariffs
Years back, I remember my dad asking why there are so many different tax rates and so many different exemption categories. (Yup, he was calculating his tax returns at that time; hence the frustration). I had gone into the standard reasons about why it is often a good thing to have those exemptions: after all, such exemptions often encourage investment in activities like infrastructure development. He had countered that it is equally often because of corporate pressure to provide loopholes to reduce their taxation. Which, of course, is true. But corporate driven tax reductions is not always a bad thing, as Ireland can tell you. Ireland’s corporate tax rate is lower than anywhere else in Europe. No wonder than that Google’s European headquarters is in Ireland! And it’s not just Google that Ireland attracted: plenty of other MNC’s go to Ireland for the same reason. That in turn translates to more investments in Ireland. And more jobs. That’s what Ireland calls a win-win. Then t...