Mr. Conor O'Brien:

I will deal with the theory first and then go into the specifics. I presume we would probably all accept that if we had, say, a 110% corporation tax rate, probably no company - certainly no foreign company - would set up here, but, equally, we would probably all accept that 0% is not the proper rate either. The rate that probably would encourage the maximum amount of investment in Ireland is somewhere between 0% and 100%, and we can have a big debate as to what that rate is. I would point out that our rate was 0% from the 1950s until the EU forced us to increase our rate from 0% in the 1980s; our rate increased to 10% and then it increased to 12.5%. An insight I can bring to the committee, which perhaps only people in our profession could bring, is that we talk to companies all of the time. We go to meeting rooms where there are people representing companies that intend to set up new operations and they have flipcharts showing the advantages of setting up in various countries. I will be there from Ireland along with a guy from my firm in France, Germany, Switzerland or wherever, and they will line up the pros and cons of where to set up their new venture. I can certainly say that corporation tax rate is a factor; it is not the only factor, but it is a factor in their decision making. If the 12.5% rate was increased to 12.51% I do not believe that would make any difference, but at some point increasing the rate would make a difference and it is very hard to get that precisely right. I am certainly aware of projects in recent years - as I said, some of this can be found publicly on the web - that have gone to the UK that might have gone to Ireland because of the fact that our rate is now 12.5% while in the UK one can de factoget a 10% rate.Even with our rate being 12.5%, we are losing out on getting some projects. I do not know what is the optimal rate - that is a matter for debate - but certainly a lower rate gives us a better chance of attracting projects. That is common sense.