The Irish bailout recently approved by the European Union and the International Monetary Fund is serving as a pretext for governments (France, Germany), multilateral institutions (the Organization for Economic Cooperation and Development) and others to bully Dublin into raising its corporate tax rate, currently set at 12.5 per cent. Ireland is resisting fiercely but the outcome is uncertain. The tussle foreshadows what in years to come will be one of the great ideological fault lines, says Alvaro Vargas Llosa, a senior fellow at the Independent Institute.
The deluge of long-term productive investments made possible by numerous reforms, including taxation, allowed Ireland to surpass Britain and Germany in income per person at the end of the 1990s.
Publish date: 22 December 2010
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