Professor Frank Barry:

Nowadays, most countries offer research and development tax credits. Ireland was certainly not the first country to provide such credits and I am not sure if those available here are more generous than those provided elsewhere. These tax credits are primarily responsible for the gap between the 12.5% tax rate and the figure of between 11% and 12% which was cited. One makes the calculation that there is a gross taxable profit in Ireland. At that point, the research and development tax credits kick in and one then arrives at a net taxable profit on which the tax rate is levied. Deputy Boyd Barrett's figures are different. He referred to certain costs being deducted from taxable profits. This means one deducts these costs from profits to arrive at a figure known as taxable profits. We started with a figure of €70 billion and the Deputy then referred to a number of costs that are deductible from this figure. Irrespective of whether these are valid costs, they are, I presume, legal. They are deducted and the number one ends up with is profits that are taxable in Ireland. When one applies the corporation tax rate to this figure the number one arrives at is not 6% but closer to 12%. I would need to examine the numbers.