Well when I ran a record company in Leicester Square, I’d walk to the Criterion for a thirty quid stuffed pepper, I mean, who would want to drive to Picadilly Circus?

More importantly, who in their right mind would want to work in Newry, I wouldn’t do it for a 100K, not if I can get a 100K in Singapore, Frankfurt, Wapping or New York?

Dublin has one advantage, it is doable.

G.

All the banks are firing not hiring.

May have been a ruuner when they first thought about it – now?

Considering Shire, the UK’s third biggest pharmaceutical firm moved its tax base from the UK to Ireland this week, the question that is being asked is how long is the UK’s disadvantageous tax system going to last.

This from Richard Lambert, director-general of the CBI British industry group:

“We are particularly worried that an uncompetitive corporate tax system is spoiling the UK’s attractiveness as a place to do business, and that other internationally mobile firms will follow Shire’s path.”

As for “European officials” being concerned, Ireland has a perpetual veto over its tax rates so it is for the Republic to give it away regardless of what the French or anyone else says.

Where are the voices of dissent ?
Where even are the devil’s advocates ?

What happened to this place ? lol

OK I’ll bite.

This is a purely political announcement that will have no impact on reality at all.

The biggest elephant is the fact that we are in the teeth of a financial crisis. How deep that crisis will be we dont know. All we know at the minute is that its not over yet. In the face of such uncertaintiy companies dont set up extra offices (even if they can cut the cost base). They do the opposite.

Next is the fact that Northern Ireland has a lower unemployment rate than ROI. Where are the people to come from to work in these new jobs ? If they are from other EU states then why would a multinational set up in Belfast to employ economic migrants when they can set up cheaper in the country the migrants are coming from in the first place. If they are to be attracted from existing employment then salaries will have to rise.

Finally – how long is the ROIs advantageous tax system going to last. This from the FT :

“The UK Inland Revenue has challenged companies’ moves to set up operations in Ireland. Two years ago, it lost a case against Cadbury Schweppes (LSE: CBRY.L – news) , which established a treasury operation in Dublin’s international financial services centre.

European officials are concerned Ireland’s low corporate tax rates give it an unfair advantage. A few years ago, the Danish authorities protested when Boston Scientific (NYSE: BSX – news) , a medical devices company, moved from Denmark to Ireland.

Pressure is mounting on the Irish to bring its tax treatment of companies more in line with the big European economies. Only last week Christine Lagarde, the French finance minister, said France would use its upcoming European Union presidency to push for a common method of computing corporate taxes across member states.

Irish officials are concerned this is a stepping stone to harmonisation.”

using NI as a cost centre rather than a profit centre then ROI companies can have the best of both worlds – ie ROI CT and at the same time tapping into NI cheaper labour and cheaper rentals.

It is common enough practice and can be rightly abused!

This is good news for the North. The Euro rose to 81p yesterday, inflation held at 2.5% last month and with lower costs generally we may do well out of businesses exploiting the advantages either side of the border.

Drive time versus train time is a problem in attracting firms to Belfast that already have offices in Dublin. Even Yanks would expect a good train service between the two major cities. As I say, it should be fixed pronto.

Sorry, I forgot to add, given Jamie Delargey’s comments, that the “new” jobs are likely to be reflective of Belfast pay levels rather than those enjoyed by their Dublin counterparts

And your problem is ?

If we were to impose a requirement of wage parity with Dublin, the jobs would not be coming here in the first place. Would you rather the jobs not come here ?

The road to prosperity and high wages comes from people starting off by doing donkey work. They’re not going to cream off their best jobs and just give them to us. They’re not going to pay us full salaries when the market will bear salaries that are much lower.

New Yorker,

I can drive door to door from Belfast to Dublin in about 1hr45. If I were to use the train, you can add an extra hour onto that. The Enterprise service is pitiful.

From central Dublin to central Belfast the train is better than driving a car, if the train service is of high quality. Last time I was there, only a few trains per day, some were more than 20 minutes late and it took well over two hours. If it is still that way, it needs to be fixed pronto.

–

DC,

“… this North-Southery was a one-way ticket to a bridge that once crossed was dire to Unionist interests. Punt seems to be eating his words alot these days … can Unionism manage the traffic to suit its own longstanding interests, capable as being sold under a Unionist political brand?”

What are the “longstanding interests” of Unionism? Pick any point between 1801 and now and the interests of Unionists appear to different. Maybe the trick is that beneath the surface it’s never really about “unionism” per se but more anout the interest of “Unionists”.

I think this deal is in the interest of Unionists. Whether it is in the interest of the union is a different matter all together.

http://www.ireland.com/newspaper/frontpage/2008/0415/1208208529397.html

It is the whole concept of a Profit or a Cost centre which often gets ignored in this whole debate about levelling CT rates north and south.

ie you only get charged UK CT on profits earned by value added in a UK jurisdiction and then ‘sold’ on either to a third party or another Group Company.

However if the Belfast office of one of these financial institutions is simply a back office operation with the main contracts and customer dealings and ultimately sale occuring in the ROI then it is not relevant or is very insignificant.

ie In the EU there is no need for an ROI based company to set up a subsidiary in NI at all – there is no difference between a back office down the corridor in Dublin and one 100 miles up the road in Belfast.
Yes the employees pay UK Income tax and NIC and the employer pays UK NIC but that is the extent of the tax liabilities.

ie in using NI as a cost centre rather than a profit centre then ROI companies can have the best of both worlds – ie ROI CT and at the same time tapping into NI cheaper labour and cheaper rentals.

The whole one CT rate is largely about ROI corporates with major profit centres in NI – Belfast Telegraph, BOI, Ryanair etc – wanting to pay one low rate of tax throughout the island.

- no conicidence that the Belfast Tele leads the charge in that debate supported by BOI economists etc.

The counties of Down, Armagh, Louth and Monaghan (that would be the hinterland of a Newry-based centre) have a combined population of around 820,000 – Belfast has metropolitan population of 579k, while Antrim, Down and north Armagh totals around 1,110,000.

Also, hasn’t Dundalk-Newry already been earmarked by planners as the next major urban development on the island? Siting a financial services sector in Newry would be a great boost to that plan – it would also require major infrastructural links not only from Belfast and Dublin (already largely in place) but also from:

northwest (mid and northwest Armagh, Dungannon and beyond)

west (through south Armagh to Monaghan)

southwest (through west Louth and southern Monaghan to Meath)

east (through the Mournes to Newcastle and Downpatrick)

southeast (extending the excellent link to Warrenpoint on to Kilkeel)

As regards an airport, you can get from Dublin airport or Aldergrove to the centre of Newry quicker than you can get from Heathrow to Picadilly.

A boost in the numbers of well-paid professionals in the area would also actually help out tourism (that great chimera, beloved and regarded as the panacea by those without a genuine economic strategy) in an area with genuine potential.

The Mournes, the southern and eastern Down cost, east Louth, south Armagh, Armagh city – these are areas of staggering natural beauty, but tourists also expect nice places to stay, to eat and drink. With a few notable exceptions, amateurism, time-warped attitudes and facilities, and sheer laziness are the norm in our hospitality sector. Tourists won’t stand for such poor performance, no matter how pretty the scenery.

Sorry, ranting now…

Also assuming that smaller processing facilities are the most likely to be moved north of the border it would not be necesary for large populations to accesable but simply a skilled work force.

Thanks for your reply.

Apparently not, the financial services companies will continue to pay corporation tax in the Irish Republic on jobs based in sub-offices north of the border.

Is that normal? I guess so: I guess the Northern Bank, for example, doesn’t pay corporation tax in the Republic despite having some branches there … or does it?

Details are thin on the ground but I assume it is something to do with the Revenue Commissioners extending the special exemption status the IFSC has to sub-offices outside the jurisdiction as long as they meet certain criteria. Open to correction on that one.

I guess that makes sense.

Hmmm, I wonder why? So essentially, decades of under-investment should now be used as the excuse to not invest again? In addition to not having enough potential workers (if you build it, we will come), I would dispute the better mode of transport but if rail is best then Newry is better placed than Belfast and in the process of getting a new station.

Time for some to think outside the (Belfast) box and spread the jobs around. There are enough people from Newry clogging the roads to Belfast day and daily that would relish the chance to work locally.