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Tom Maguire: What a tangled web we weave when we take on EU tax law before simplifying our own
A new European directive aims to redress the imbalance in debt/equity investing, but here in Ireland, achieving a tax deduction for interest on debt financing is already galactically complex
Cash, sourced from either debt or equity, is the lifeblood of business.
In general, tax deductions are given where a company finances its activities by debt and not equity. Last month, however, the European Commission released a draft for a new directive to address this tax-induced debt/equity bias.
The proposal includes both a debt/equity bias reduction allowance (Debra) in the form of a notional interest deduction on equity, and a general limitation on the tax ...
