Ireland technically out of recession

[Riddickcule]

GDP grew slightly during the third quarter but the Central Statistics Office (CSO) has urged caution on calling an end to recession
The latest Quarterly National Accounts, which were published this morning, indicate that on a seasonally adjusted basis there was a 0.3 per cent increase in Gross Domestic Product (GDP) from July through to September.
On an annual basis, GDP fell by 7.4 per cent in the year to the end of October, compared to a 7.9 per cent decline in the preceding quarter.
Technically, given that the definition of recession is two quarters in a row of falling GDP, this means that Ireland has now exited recession.
However, at a press conference earlier today, assistant director general of the CSO Bill Keating refused to call an end to the recession, pointing out that much of the rise in GDP was attributed to profits from multinationals based in Ireland.
Whether Ireland was out of recession or not was " a matter of semantics", Mr Keating said.
"The general picture shows that on a seasonally adjusted basis there is a levelling off in GDP but GNP continues to decline, albeit at a slower pace than it has in previous quarters. Contributing to the GDP increase in a fairly major way was growth in the multinational sector," he added.
Analysts also warned against declaring the end of what has been one of the worse recessions ever experienced in Ireland.
GDP is the international method of calculating economic decline but in Ireland's case, the Economic and Social Research Institute (ESRI) and other local bodies prefer to focus on GNP (Gross National Product) a measure which strips out multinational profits, much of which usually leave the country.
According to CSO, profits declared here by foreign-owned enterprises increased by €1,054 million during the year ending October 31st 2009.
During the third quarter Gross National Product (GNP) showed a decline of 1.4 per cent on a seasonally adjusted basis. In the year to the end of October 2009, GNP was 11.3 per cent lower.
A breakdown of the latest CSO figures show that consumer spending was 7.3 per cent lower in the third quarter of 2009, compared to the same three-month period a year earlier.

Captial investment declined by 35 per cent on an annual basis while net exports were 2,813 million higher than a year earlier.

Over the year the volume of output of industry decreased by 9.6 per cent. Within this the output of the construction sector fell by 34.4 per cent.

Output of distribution, transport and communications was down 9 per cent on an annual basis, while output of other services was 3.4 per cent lower, the figures show.
Alan McQuaid, economist at stockbroking firm Bloxham said given that international commentators put so much emphasis on quarterly changes in GDP, we shouldn't downplay the third quarter increase. He said we should take some consolation that on this basis, Ireland came out of recession ahead of the UK.

"Overall, we continue to believe that the Irish economy is making progress and is heading in the right direction," said Mr McQuaid. "While GDP is set to contract by around 7.5 per cent in real terms in 2009, we still think the average fall in national output could be less than 1 per cent next year."
Commenting on the quarterly figures, Ibec senior economist Fergal O'Brien said the latest data shows the economy is beginning to stabilise.

"In terms of the pace of contraction in the Irish economy, the worst is now clearly behind us. Most sectors of activity are showing signs of stabilisation, with the exception of the construction sector, which continued to lurch downwards in the third quarter," he said.
"Today’s numbers do not change our view that GDP will fall by about 7.5 per cent this year and will drop on an annual basis again in 2010. We can now see some light at the end of the tunnel, however, and the economy should begin to grow again around the middle of next year.
KBC's chief economist Austin Hughes also rejected the idea the recession was over saying the quarterly GDP increase does not reflect the reality of the drop in incomes and employment experienced in Ireland over the past year.








http://www.irishtimes.com/newspaper/breaking/2009/1217/breaking35.htm

[Fr Damo]

Did anyone see Gaybo & the Late Late Show on Friday. When asked by Tubs about the economy and prospects for next year Gay said he felt 2010 was going to be a bloodbath ( a rather poor choice of words tbh). This follows the Big Fella (Ben Dunne) two weeks ago, who said something similar. I think perception is reality for a lot of people on the back of RTE telling us all we're in the doldrums we probably will stay there for the foreseeable.

There was also a thing on Saturday Morning Radio 1 with John Murray. His show is called the business. They were around Dundrum on Saturday spying on the number of shopping bags people carried as being the best KPI. Apparently there werent many bags evident though this was on around 10 or 11am.

We maybe out of it technically but consumption is still in decline and that's the real indicator in my view. Retail/Hospitality jobs under big pressures next quarter.

[dahamsta]

While I wouldn't put a lot of stock in Greybo and VisitMyWebsite Coke Fiend, I'd have no hesitation in agreeing with them on this, and I'd have no problem with the Irish hearing about it. There's still far too many people in the shops imho, if they keep that up and we pull out or recession too early there'll be another bubble, and the next time we come down it'll likely keep us there for 10 or 20 years. We needed a funt up the arse, and, unbelievably, we don't seem to be have really noticed it yet.

All of the above is meant collectively of course. I completely understand that some are feeling it worse than others. I'm shocked by the number of people in the shops though, not just in the lead up to Christmas but for months now. Mahon Point in Cork is absolutely jammed on Sundays, it's bloody crazy.

[Macy]

They've done nothing about job creation, job saving and have taken money of the people that spend pretty much all the income. How can we not be over the worst?

[Fr Damo]

They've done nothing about job creation, job saving and have taken money of the people that spend pretty much all the income. How can we not be over the worst?

Peak to trough on Asset valuations of about 65% don't make good reading meaning the banks can't borrow internationally,Nama money isn;'t through yet, and then Prof Hounihan said the big two will need more government capital thus shredding share prices today!
Yeah, i think we have a bit to go yet.

[dahamsta]

I wouldn't be surprised if we dip back into recession before coming out of it properly. I stand by my prediction of end 2010 before we see proper, tangible growth.

[eamo1]

Of course we are out of recession,Ireland voted Yes to the Lisbon Treaty and we were promised it would be good for the economy and jobs if we did,so of course we're out of it:rolleyes::rolleyes:.

[dahamsta]

I hate to sound like Bertie, Blair or Bush, but Lisbon is done, there's nothing you can do about it bar make noise in the right places. This isn't one of them.

[Fr Damo]

I don't think Joe Public believed/thought Lisbon 2 was going to be a light switch in terms ofkick starting the economy, though things have gone very quite with it from the No side.

Dublin corpo are cutting Business rates by 2% this year, a clear acknowledgement we aren't out of the woods by any stretch. Begs the question though, if the pay required to administer such rates is being cut by 5%, 7.5% etc etc, inputs are falling interms of inflation at 5.5% anyway, why is the rate cut only 2%?
Looking forward to what Roscommon Co Co are going to do for me!

Prime time was interesting last night, nothing new, though we got an insight as to why were as deep as we are in this country. We have been held to ransom, and though I supported it at the time, NAMA is looking like a bit of a pup. I trusted A. Ahern, though M. Kelly seems to be closer to the mark.

[pineapple stu]

I don't think Joe Public believed/thought Lisbon 2 was going to be a light switch in terms ofkick starting the economy
I know people who changed from No to Yes because of the recession. Don't underestimate how stupid people can be.


I wouldn't be surprised if we dip back into recession before coming out of it properly.
I'd be surprised if we didn't, to be honest. Let's see what happens after the Christmas sales, for example. Or after a second awful January in a row for the motor industry. Still plenty of businesses to go, unfortunately. I'd say a lot are still living off the fat they'd built up.

[mypost]

I don't think Joe Public believed/thought Lisbon 2 was going to be a light switch in terms ofkick starting the economy.

They did. That's what the posters told them. That's what the politicians told them. Did it happen? Did it what?

Spending might be up, but there won't be visible signs of recovery, until there is significant job creation. And that could be several years away yet.

[Fr Damo]

Had to grin yesterday when Biffo implied we know where we stand now as compared to last December. Also VT clips of prime time & Pat Neary saying " the Irish Banks are soo well capitalised ". What a joke.

Edege and abyss come to mind.
Certain sectors of the media seem to have forgotten we still need to borrow 20Billon squid next year to run the country & I'm begining to think we'll struggle cos these banks of ours are literally insolvent. They won't be in any hurry to lend in 2010 thus leaving tax receipts down on targets. Stu, I forecasted 60,000 newcars sales for this year, what did we hit?
I'd reduce that to 45000 - 50000 next year. Second hand car market is doing ok in the 5000 - 6000 range i.e bought with savings out of necessity rather than with loans or finance. Some good value out there - if you didn't own one already!

[pineapple stu]

Stu, I forecasted 60,000 newcars sales for this year, what did we hit?
Not sure countrywide, but I know 09-D-29000 or so went out last week. I'd say you were probably under, but not by a huge amount. That's back to 1988 levels. There's more demand than that out there, but people are finding it next to impossible to get finance. From next year, some finance houses won't finance VRT, so it'll be even harder to get finance.

[Macy]

why is the rate cut only 2%?
Less other money coming in from development levies and central funding is/ will be down.


We have been held to ransom, and though I supported it at the time, NAMA is looking like a bit of a pup
Well I never supported, but it looks a dead duck now anyway. They might've got the con job done if they'd moved quickly, but as in everything else since the collapse they can't make a quick decision which is fooking us up even more.


There's more demand than that out there, but people are finding it next to impossible to get finance
It's also the trade in values that people are getting, if they'll even take a trade in at all. It's there that the scrappage scheme will have some impact imo.

[pineapple stu]

It's also the trade in values that people are getting, if they'll even take a trade in at all. It's there that the scrappage scheme will have some impact imo.
This is true too. Though haven't heard of garages not taking trade-ins; worst case scenario, there's usually a trader willing to buy them off the garage immediately.

The scrappage scheme won't have too much impact, I'd say. It'll mainly affect low value cars (Micras and the like) and - without looking at figures - I'd say it's the higher end stuff that's being hit the hardest. The scrappage scheme won't make much difference to sales of Audis, BMW, Mercs, VW - saloon cars, basically. (Course, the argument is there as to whether it's a good thing that we now aren't buying new BMWs every other year).

[Macy]

This is true too. Though haven't heard of garages not taking trade-ins; worst case scenario, there's usually a trader willing to buy them off the garage immediately.
I have, but it's more common that they're giving such a low value that people are saying no to it, especially if they've existing finance.

[Fr Damo]

[QUOTE=pineapple stu;1296362]Not sure countrywide, but I know 09-D-29000 or so went out last week. I'd say you were probably under, but not by a huge amount. That's back to 1988 levels. There's more demand than that out there, but people are finding it next to impossible to get finance. From next year, some finance houses won't finance VRT, so it'll be even harder to get finance.

Sale to end of Nov 09 = 57151
Sales for Nov 09= 520

If sales for Dec remain about the same levels we are looking at 57600 new cars this year. Down 62% on last year (151,000 Vehicles)

Remember watching prime time about April or May last year and some clown was on from SIMI saying they were still hopeful of 100,000 vehicle sales. I would say the break even point for the Irish Car "Industry" is about 80 - 100 thousand vehicles.

The real indicator is goods vehicles, down 69% in both the light commercial sector (vans) and HGV sector (truck and lorries). This indicates that consumption and internal demand isn't going to pick up anytime soon in my opinion, and therefore the title of this tread although technically acurate, much ado about nothing!

www.simi.ie (http://www.simi.ie) - New Vehicle Registraions.

With the phasing out of VRT, expect car prices to erode value over the implementation period, expect further job losses in this area of the economy and thank FF / Greens. (FF for bringing in VRT and the greens for the tax band changes)

Downing Street, take us back.

[Macy]

(FF for bringing in VRT and the greens for the tax band changes)

Nothing wrong with moving to emissions based taxes, the problem was annoucing it months before it was going to happen.

[Royal rover]

Wait until interest rates go on the rise that's when the s**t will really hit the fan for lots of people - next year will be worse than 2009 - when i read stories in the indo about 20,000 people looking for social housing it will be up to 60,000 by end of next year guaranteed, i think stats are a very misleading sometimes officially they might show one aspect of recovery but it's stil lvery far from the truth

[Fr Damo]

I think stats are a very misleading sometimes officially they might show one aspect of recovery but it's stil lvery far from the truth

"Lies, damned lies, and statistics" is a phrase describing the persuasive power of numbers (http://en.wikipedia.org/wiki/Number), particularly the use of statistics (http://en.wikipedia.org/wiki/Statistics) to bolster weak arguments (http://en.wikipedia.org/wiki/Argument), and the tendency of people to disparage statistics that do not support their positions.

WIKI Defenition!

[NeilMcD]

I must say, the car industry I have no sympathy for. At teh end of the day people were updating their car every 2nd or 3rd year. We do not need that and its pure luxury. We would be better off focusing on public transport and get people using that and cycling bikes than using cars. Obviously cars are needed in some cases but not to the extent that we used them in this country in the past 15 years. Nothing worse than seeing some silly cow in a big Jeep living in Foxrock or Dublin 4.

[Fr Damo]

This isn't / wasn't about the "car industry" but a byproduct of the discussion. Your entitled to your views but as yo don't own a car don't think you should be commenting on people tastes or their practices in terms of how often they replace them.
Often cars are replaced simply to keep within warrenty, and confusesd by those not in the know with extravagence.

Whats wrong with owning a big jeep, and living in D4 as you put it? Should you not own one and or live in D4 or Foxrock?

Maybe, she or her husband can afford it, maybe he'd like her to be safe when she is driving on the motorway to teach kids in Arklow. Or any number of other reasons.

Had a call from MBNA at lunch time, they noticed I withdrew cash on the credit card, thought they'd check with me to see every thing was ok and more specifically that I was still working! I told her it was the first time i'd ever been discouraged not to withdraw or use my credit card!! She Laughed.

[pineapple stu]

We do not need that and its pure luxury.
Thing is, luxury spending is kind of what's gotten us the standard of living we have. If we all stop splashing out on ourselves, then there's going to be many more jobs lost. Damned if you do, damned if you don't. We've no real underlying support industries really, especially since the numbers in farming are way down. I've said it before - our core industries are cheap tax and building more houses to make us all rich, and that's about it.

[Mr A]

In fairness, the state does have a very large and successful IT sector. Obviously it's a cut-throat market that can change quickly, but there have been announcements of jobs consistently throughout the year.

[NeilMcD]

This isn't / wasn't about the "car industry" but a byproduct of the discussion. Your entitled to your views but as yo don't own a car don't think you should be commenting on people tastes or their practices in terms of how often they replace them.
Often cars are replaced simply to keep within warrenty, and confusesd by those not in the know with extravagence.

Whats wrong with owning a big jeep, and living in D4 as you put it? Should you not own one and or live in D4 or Foxrock?

Maybe, she or her husband can afford it, maybe he'd like her to be safe when she is driving on the motorway to teach kids in Arklow. Or any number of other reasons.



So because I do not own a car I cannot comment on this. So areyou saying you comment on this forum with things that relate directly to you.


One of the things that is wrong with owning a big jeep is the high emmissions it produces. The facts are that if more people used public transport and or cycled it would be better for the environment.

Nothing wrong with living in D4 or Foxrock but there is a huge amount of people that have cars and jeeps in those areas that do not bloody need them. They are an extravagance on a grand level, and represent all that was bad about the Celtic Tiger years in Ireland. But yet people want to have a go at a carer or a teacher for earning too much. The targets in the media are wrong here.

We should have more prohibitive taxes on this sort of waste.

[Fr Damo]

So because I do not own a car I cannot comment on this. So areyou saying you comment on this forum with things that relate directly to you.


One of the things that is wrong with owning a big jeep is the high emmissions it produces. The facts are that if more people used public transport and or cycled it would be better for the environment.

Nothing wrong with living in D4 or Foxrock but there is a huge amount of people that have cars and jeeps in those areas that do not bloody need them. They are an extravagance on a grand level, and represent all that was bad about the Celtic Tiger years in Ireland. But yet people want to have a go at a carer or a teacher for earning too much. The targets in the media are wrong here.

We should have more prohibitive taxes on this sort of waste.

I thought my post was fairly honest and straight forward, you only justified your feelings in your last post. Thanks for that.

I'm of the same opinion as Pineapple stu, without the government getting the taxation from such extravagance there wouldn't have been the increase in special needs teachers, or unemployement benifit so it really is a chicken and egg scenario. We are all in agreement here that they totally mis managed the boom and it is fairly clear we disagree on how to get out of it. I have total respect for your Joe Higgins esq political views, If we had more of him shouting louder at Bertie/Charlie Mc through the boom we'd be further on today, but like the other side of the coin in terms of free market and deregulation, sorry unregulation, too much any-one-thing is bad for ya.

[pineapple stu]

I'm of the same opinion as Pineapple stu, without the government getting the taxation from such extravagance there wouldn't have been the increase in special needs teachers, or unemployement benifit
Just to clarify my point, I'm also saying that if we weren't changing cars every other year, there wouldn't have been half as many people picking up a wage in the motor industry, which they could then use to redevelop their house purely because it was the fashionable thing to do, keeping many tradesmen in business, who'd then help keep the newsagents in business buying breakfast rolls instead of maybe bringing their own lunch in, and so forth.

(And Mr A's point is acknowledged, thanks).

[Fr Damo]

Stu, That is my underlying point, internal consupmtion and as a result indirect taxation (I Include stamp duty, VRT etc) is what made us then and ironically, what we are today. It wasn't corporation Taxes on the multinationals, the government was and still is happy for them to employ & pay ltlle but tax us when we spend.
Now that we have stopped spending, Sorry Adam, but I don't see much retail going on up here, the hole is becoming all consuming.

for the record, I support the low corporation Tax rate to intice multi nationals, could probably tolerate a small hike too but we won't pull out of this until employment (I'm focusing on that rather than unemployment becuase our goods and services providers have a capaity for about 2.2m workers spending hard cash) starts to increase from the 1.8m it's at now.

[NeilMcD]

Its funny that the same people who are calling for cuts in wages are all people who believe that internal consumption is what made us have the boom and seem to think its what will get us out of the boom.


And silly comments comparing me to Joe Higgins, add nothing to the debate I am sure.

[Fr Damo]

thought we had this last week. Fine, keep your 5% of 204 quid, 5% of of earnings less than 30k in the public sector etc etc. See how much that contributes to consumption! About 1.4 billion euro I think. nothing, absolutley nothing, in the scheme of things. What we need are feckin jobs. Read my post, how we get them (back) is the underlying issue.

BTW, i think Joe Higgins is worthy of any vote.

[NeilMcD]

[QUOTE=Fr Damo;1296641]thought we had this last week. Fine, keep your 5% of 204 quid, 5% of of earnings less than 30k in the public sector etc etc. See how much that contributes to consumption! About 1.4 billion euro I think. nothing, absolutley nothing, in the scheme of things. What we need are feckin jobs. Read my post, how we get them (back) is the underlying issue.

BTW, i think Joe Higgins is worthy of any vote.[/


Well if it contributes 1.4 billion in consumption and it means that lives are not ruined etc well then it can be worth it.

It seems that it is good economic policy for rich people to splash money jeeps and whatever they like as its good for internal consumption but when that argument is used for people on the low wage or on the dole it is desribted as absolutely nothing, despite the fact that someone on low wages spends every bit of their penny in the economy and have very little savings so therefore contribute their money directly to internal consumption.

I agree with need to create jobs but their was nothing in the last budget that is going to create jobs in my view. Or very little anyway. I am certain though that cutting peoples wages by 5 per cent at the lowet level will not create any jobs.

[Fr Damo]

Well if it contributes 1.4 billion in consumption and it means that lives are not ruined etc well then it can be worth it.

It seems that it is good economic policy for rich people to splash money jeeps and whatever they like as its good for internal consumption but when that argument is used for people on the low wage or on the dole it is desribted as absolutely nothing, despite the fact that someone on low wages spends every bit of their penny in the economy and have very little savings so therefore contribute their money directly to internal consumption.

Neil, i don't know what you are on about.

I did hear a guy on the front line last night who says he has three employees and they asked him about working 19 hours a week to claim for the other days off. he said his employees would be better off as a result!.

The solution 1)cut the dole 2) put mechinisms in place so this cannot happen be possible or, 3) the employer could increase the wage he pays his staff to keep them interested and see where that gets him.

I have said this here before, I would not have slashed indiscriminatly as per the budget, but I think you have my views at this stage.

Just heard on Today FM that there are 26000 in arrears with mortgage payments, we ain't seen the wort yet i'm afraid.

[mypost]

In fairness, the state does have a very large and successful IT sector.

It did have it, now other countries have it. And they'll have more of it, when President Van Rompuy imposes universal corporation tax rates on us, as he is said to be in favour of.

Watched Reeling in the Years last night. When the last technical recession ended in 1983, 38,000 people joined the dole that year. Job creation didn't grow until 1994.

By contrast, 36k joined the dole in January this year alone. 150-200k people joined this year. It'll be many more years before they see the end of the recession.

[weecountyman]

It did have it, now other countries have it. And they'll have more of it, when President Van Rompuy imposes universal corporation tax rates on us, as he is said to be in favour of.

Watched Reeling in the Years last night. When the last technical recession ended in 1983, 38,000 people joined the dole that year. Job creation didn't grow until 1994.

By contrast, 36k joined the dole in January this year alone. 150-200k people joined this year. It'll be many more years before they see the end of the recession.

In 1996 I was finishing Uni and in my field there were almost no active jobs in Ireland unless you had 1. major connections or 2. got into the civil service. The private side of things were almost non-existent save for a few hardy souls plugging away. Graduates tended to move into teaching or go into another branch of the arts etc. I left Ireland, returning fully for a 6month spell in 1999 and saw that our "sector" had boomed, workers were becoming unionised and every gobsheen and spoofer was working. The students who had about as much application for our science were suddenly "independent contractors" and massive amounts of money were spinning around. There weren't enough workers available and at one point, down south in Waterford, a lad thumbing a lift was dragged on site for a days work and ended up staying a month.

Now those at the top of the profession are the same miscreants, spoofers and corrupt twits who have ruined Ireland's heritage for their own gain, yet advise on suicidal policies and even got into the universities as lecturers. As one former lecturer told me back at a work reunion in October, "We're in a one shot game, no come backs, which has played perfectly for those who have conned their way to the top."

[Fr Damo]

The ERSI came out this morning to say we are in recovery but..... we carry an equal risk of expanding or contracting by the same amount this year. Talk about sitting on the fcekin fence.
Personally, Jan 2010 is the worst start to any year in my working life.

[dahamsta]

Your support of the incumbent in spite of this would seem to suggest a preclusion towards masochism.

[Fr Damo]

Is that a polilte (albeit confusing) way of saying I'm contradicting myself?

I've never said I support the current lot, though they have one or two worth while canditates.
I have, however said an election right now doesn't serve us at all imo, but that I am really looking forward to the next election and FF canvasers calling at my house. I also think this shower are going full term, unfortunatly. My professional situation isn't a quick fix, my sector would probably lag a full year behind any pick up (or slow down), and going to be in the doldrms a while regardless who is in charge.

[bennocelt]

The ERSI came out this morning to say we are in recovery but..... we carry an equal risk of expanding or contracting by the same amount this year. Talk about sitting on the fcekin fence.
Personally, Jan 2010 is the worst start to any year in my working life.

Arent they not FF, just like RTEFF? Would rather hear some real independent reports on our economy

[dahamsta]

There's no quick fix, however leaving these idiots in charge is a guarantee that it'll be a slower fix, and that's masochism. Politeness or otherwise doesn't come into it. It's a pretty simple concept, I'm surprised you have difficulty with it.

Like economics. Macro economics is hard, but macro economists - proper economists now, not the conflicted standard-bearers the banks or corporations roll out over here - would laugh at Ireland even being included in that field. We're a small country with a simple financial system and you don't need to go much further than bog standard economic rules to know which way the country is going to go if you do x, y or z. It's easy peasy stuff, our Leaving Cert students learn them. I did Leaving Cert Economics and I knew what was going to happen. That's why I waited until now to buy my house, from a liquidator.

The incumbents couldn't hack that. They didn't get that they were overinflating the economy. They still don't understand the harm they've done, and they still don't know how to fix it. So, leaving them in power is masochism. Understand?

[Fr Damo]

I'm sorry to dust off this old thread but thought it twas the best place for my comment. I paste a piece from RTE online

"A breakdown of the tax figures showed that €987m in income tax was taken in, down 6.2% or €65m from a year earlier. The income tax returns do not fully reflect the income tax rise and universal social charge introduced in the Budget, which will appear only in the February figures.
Corporation tax jumped almost 78% to €72m, while VAT was up 3.6% to almost €1.7 billion. Excise duties were 8.2% higher at €281m, but capital gains tax was down almost a third at €18m. Stamp duties were 39% up at €41m. The Government is forecasting 9.9% growth in tax revenues for 2011 as a whole"

Corpo tax at 72m squids for the month is a joke when you consider they are talking out of the other side of their mouth reagrading record export and manuafturing figurers. I said it before last year, the 12.5% rate is one tax I think we can afford to increase and would advocate 15%. How much would an extra 2.5% of tax bring in I wonder? More than the USC I bet.

[pineapple stu]

What month is that for? CT takes will vary wildly with month I'd imagine, as you'd have something like half of all companies would have December year-ends, and so would pay most of their tax in November (one month before), with the balance in the summer (the exact month has probably changed since I was in practice).

Don't forget that increasing tax could have a negative effect as well if companies up and leave because of it. Given how reluctant the Government are to change CT, I'd imagine they've possibly suggested an increase and been told where to go.

[dahamsta]

Fr Damo, please include a link to quoted content.

Personally I think the new government should put corporation tax up by .5% per year for each year of their term, with a legislative cap on further increases beyond 15% for 5-10 years. It still leaves us with a great rate, and it makes it easier for corporations to deal with, hopefully preventing an exodus (on any level; the idea that they'd all just up and leave is nonsense, pure and simple).

However it's far more important to close the loopholes the likes of Google are exercising to pay effective rates less than 5%. That's just criminal.

[pineapple stu]

(on any level; the idea that they'd all just up and leave is nonsense, pure and simple).
I don't think anyone's suggesting that. The elasticity of the CT is important though - whether a ½% rise in the rate will actually lead to more cash.

Unfortunately, it seems like big business has the country completely bitch-whipped - the banks being the obvious example, but there was also the example of the chewing gum industry managing to shout down the proposed 5p levy on chewing gum packs to cover the cost of cleaning it off paths. We need to start running the country like a company - running it competitively (i.e. none of this "ESB aren't allowed compete" rubbish") and making decisions in the country's interest, and not in that of big business. I don't see any of the parties really offering that though.

[Fr Damo]

A couple of points,


1) if a 72m take is up 78% on last Jan last year it means they collected about 40m last Jan 2010. Yet for the year they gathered close to 4billon. Therefore Stu is right phasing must be considered.

2) If exports are at 160 odd billion and these companies alone are taking 10% return on sales that's 16billon to be taxed at 12.5% or about 2b in tax. The real economy (i.e indegious, internal suppliers whose goods are servises remain largley within the state) are being taxed a further 2billon and that is an unfair burden in my opinion.

3) Elasticity is the key as stu says and personally 3% is nothing in the scheme of things and considering labour rates and in other input costs are failing, Corpo tax at 15% would still leave Ireland Inc a very competitive site for investment.

We need to get another 100,000 working in the real economy to fuel some sore of consumption/internal demand, this will increase indirect taxation thus reducing the need on labour taxes.
I wouldn't say no to another 50,000 high end jobs, then let 100,000 leave these shores We then leave 150000 signing on. This would be an unemploymet rate of 7.5% of 2m work force.

My underlying point though is we need to tax Ireland Inc more, and reduce the burden on MR and Mrs PAYE with the objective they spend a bit more.