Michael Noonan (Limerick City, Fine Gael)

I propose to take Questions Nos. 33, 55 and 78 together. I wish to advise the Deputies that companies operating in Ireland are chargeable to corporation tax at the 12.5% rate on their trading profits. A higher 25% rate applies in respect of investment, rental and other non-trading profits and chargeable capital gains. This rate also applies in respect of certain petroleum, mining or land dealing activities. The 10% corporation tax rate for profits from manufacturing expired at the end of 2010 and the 12.5% rate now applies to such profits. Accordingly, all companies operating here pay corporation tax at the 12.5% rate or at the higher 25% rate on their taxable profits. Irish resident companies pay corporation tax on their worldwide profits subject to relief for foreign tax paid on profits earned abroad. Non-resident companies trading in Ireland through a branch or agency pay corporation tax on the profits of their Irish branch.

I am informed by the Revenue Commissioners that, for the year 2009, which is the most recent year for which information on corporation tax returns is available, approximately 47,000 companies with taxable income filed returns for accounting periods ending in that year. Of these, approximately 28,000 companies, or 60%, paid corporation tax at the 12.5% rate. The remaining companies either paid tax at the 10% manufacturing rate, now expired, or at the 25% rate.

In regard to employment, the Revenue Commissioners do not have an estimate of the number of persons currently employed by companies chargeable to tax at the 12.5% rate of corporation tax but, based on P35 returns filed by employers for 2010, the estimated number of employments in all companies on Revenue records for that year was 1,590,367. I should emphasise that this number relates to employments, not individuals, and reflects the reality that many employees have more than one employment. Employees with more than one employment are therefore counted more than once in the figures provided.

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