The Government should implement even deeper spending cuts in order to pay for tax cuts for higher paid workers, according to the incoming president of the American Chamber of Commerce in Ireland.
Louise Phelan, who runs PayPal's European headquarters, criticised the level of higher rate income taxes this morning at a briefing to outline her priorities for her term as the chamber's president. She said an effective "52 per cent rate of tax kicks in "far too early".
Ms Phelan, who is also a non-executive director of Ryanair and also sits on the National Competitiveness Council, said it was up to the Government to decide where spending cuts to pay for tax reductions would have to be made.
“I don’t have an opinion on [where the cuts should be made]. But they absolutely do,” she said.
Several ministers, including the Minister of State at the Department of Finance, Brian Hayes, have publicly mused in recent weeks that tax cuts are needed to stimulate growth in the economy.
Ms Phelan said her goal for her presidency of the chamber, which represents the interests here of companies including Google and Microsoft, was to help "make Ireland the investment location of choice" for US multinationals.
“Critical to attracting new investment is to ensure we have a strong business case for investors,” she said.
She called for “urgent attention” to be given to the development of new commercial premises suitable to house the offices of foreign investors. Ms Phelan also criticised the cost of energy in Ireland and said the country “needs the right [energy] infrastructure to keep a lid on costs.
She said the chamber is "actively working" with universities and the Higher Education Authority to come up with solutions to address a "skills gap" in the Irish workforce.
She also supported the government’s intention to “clear up” any anomalies in the corporate tax system, which she said was transparent.
When asked if any of the chamber’s members should be criticised for implementing aggressive tax avoidance schemes such as the “Double Irish”, she replied: “Everyone has been tax compliant and nobody has been found otherwise.”
