Less than two weeks ago Irish Taoiseach Micheal Martin’s visited the White house for Patrick’s Day. Economic and geopolitical tensions marred the usually joyous occasion. As president Trump singled out the Irish pharmaceutical sector as stealing American jobs and manufacturing. Ireland faces frightening consequences from Trump’s EU Tariffs.
Howard Lutnick, the US Commerce Secretary, accused Ireland of operating as a “tax scam”. Monday night the Irish Government hit back at these claims and raised fresh concerns about the devastating impact the April 2nd “liberation day” sanctions could have on the island nation with historic ties to the US.
Nearly half of Ireland’s multinational workforce could be at risk, as the US president aims to repatriate jobs and taxes to America.
In a worst-case scenario, Ireland’s finance minister, Paschal Donohoe, told RTÉ that “it’s very possible between 50,000 and 80,000 jobs that would have been created or retained in the economy may not materialise.”
The Irish Response
In response to Lutnick; Ireland’s enterprise minister, Peter Burke, rejected his description of Ireland’s trade surplus with the US as “nonsense” and insisted he was dead wrong.
“We have the most bilateral and tax treaties in the EU, so there are absolutely no tax scams in this country. Burke told RTÉ “We’re very transparent,” . He also highlighted that Ireland had taken a leading role in the OECD’s revised tax agreement, which increased the corporate tax rate from 12.5% to 15%.
During a meeting in the Oval Office with Ireland’s Taoiseach two weeks ago, the US president made it clear that Ireland he would specifically target US pharmaceutical giants operating in the country, such as Pfizer and Eli Lilly.
The US has also threatened a 200% tariff on EU alcohol imports as a response to the EU’s plans to impose additional taxes on American whiskey.Ireland exports around €800m worth of alcohol to the US annually, with over half of that coming from Irish whiskey brands like Jameson, Teeling, and Connemara.
Ireland’s Economic and Social Research Institute reported last week that, in a worst-case trade war scenario, the Irish economy could contract by up to 3.7%. Whether Trump’s EU Tariffs will become a reality we will find out next week. If he does indeed follow through, the result will be catastrophic for “America’s Little Brother” as described by possible presidential candidate and Trumpite Conor Mcgregor.
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